During year-end tax planning you may want to manipulate the timing of income or deductions. Review some common strategies.
Accelerating deductions and deferring income can reduce your tax liability. In some cases, you may want to do the opposite—accelerate income and delay deductions. These methods can help you pay a lower income tax rate in the long run, especially if your tax rate is—or could be—changing in the next year.
If you have access to Ayco, your advisor can help you implement a tax-efficient strategy. You can also work with a tax advisor to review your specific circumstances.
Whether it’s best for you to increase or decrease your taxable income for the year, here are some strategies to consider.
If you want to defer income, consider:
In addition to deferring income, another way to decrease your tax liability in the current year is to accelerate deductions. Here are some common methods:
If you want to accelerate income, consider:
There are additional strategies if you’re looking to accelerate capital gains:
If you expect your deductions to produce a larger tax savings next year, here are some common methods of deferring them:
Connect with your advisor for more on this topic.
The information herein is for educational purposes only. GS PFM does not provide tax advice or prepare taxes. We encourage you to connect with your team of advisors regarding your unique situation.
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Based on “Year-End Planning for 2021” by “Heidi Goetting”, 2021 The Ayco Company, L.P.
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United Capital Financial Advisers, LLC d/b/a Goldman Sachs Personal Financial Management (“GS PFM”) is a registered investment adviser and an affiliate of Goldman Sachs & Co. LLC and subsidiary of The Goldman Sachs Group, Inc., a worldwide, full-service investment banking, broker-dealer, asset management, and financial services organization.
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