We’ve only got a few weeks left in 2015, and I’m sure you are looking for something else to stress about during the holiday season, besides those family members shacking up with you for a few weeks (yes you cousin Eddie).
So let’s look at a few financial to-do’s you might want to review with your financial advisor before the end of 2015.
- Review your portfolio’s capital gains exposure. We’ve had pretty solid market gains the last few years, but maybe you have a few individual stocks that have not done so well in 2015. It might be a good time to look at selling those before the end of the year to realize a tax loss. It might allow you to realize some of those gains as well, or give you a decent write-off on your taxes. Work with your tax professional and financial advisor to develop a plan.
- Review your retirement plan contributions. There weren’t any major changes to the 2016 limits you can make to your retirement plans (IRA’s, 401k, etc) but it’s a good time to get a plan for 2016. If you aren’t adding your 401k, at least to the company match, try to increase your contributions by at least 1%. That free money provided by your company can really give your 401k a boost, without you taken a big hit on your income.
- Consider Roth conversions. It might be a good time to convert your traditional IRA to a Roth IRA. There are a lot benefits to the Roth IRA, including tax-free income in retirement. If you have traditional IRA assets, you can choose to pay some of those taxes in 2015 and convert those dollars over to a Roth IRA. Work with your tax professional on this as well to see if it’s a good fit.
- Make sure you’ve satisfied your RMD. This is important if you’re over the age of 70 ½ or have an inherited retirement account. The IRS makes you take out a certain amount of money from your retirement accounts (except for your Roth IRA accounts, which are exempt) each year after reaching 70 ½ . If you don’t they can penalize you for not taking the withdrawals. Make sure your CPA and financial advisor is aware.
- Finish up those charitable giving goals. If you aimed at setting aside a certain amount to your favorite charity, finish it out by December 31st so it will count for the 2015 tax year.
Deadlines to watch for early in 2016
- February 1st – 1099 and 1099-R forms start to mail.
- April 15th – IRS tax filing or extension deadline. You’ll also want to make sure to make any IRA contributions for the 2015 tax year by this time as well.
Most importantly, get help. This time a year is a great time to sit down and review your plan with your tax professional before tax season gets them slammed stacks of paperwork. A financial advisor can work with your CPA as well to make sure you have a plan in place for 2016.