Are you coordinating your income tax planning with your estate plan?

10_11_16-486896088_ITB_560x292.jpgUntil recently, estate planning strategies typically focused on minimizing federal gift and estate taxes, such as by giving away assets during life to reduce the taxable estate. Today, however, the focus has moved toward income taxes, making the coordination of income tax planning and estate planning more important.

Tax-smart options for your old retirement plan when you change jobs

10_04_16-493245164_ITB_560x292.jpgThere’s a lot to think about when you change jobs, and it’s easy for a 401(k) or other employer-sponsored retirement plan to get lost in the shuffle. But to keep building tax-deferred savings, it’s important to make an informed decision about your old plan. First and foremost, don’t take a lump-sum distribution from your old employer’s retirement plan. It generally will be taxable and, if you’re under age 59½, subject to a 10% early-withdrawal penalty. Here are three tax-smart alternatives:

Time may be running out — again — for tax-free treatment of home mortgage debt forgiveness

09_13_16-485171050_ITB_560x292.jpgIncome tax generally applies to all forms of income, including cancellation-of-debt (COD) income. Think of it this way: If a creditor forgives a debt, you avoid the expense of making the payments, which increases your net income.

Now’s the time to start thinking about “bunching” — miscellaneous itemized deductions, that is

08_23_16-101359492_ITB_560x292.jpgMany expenses that may qualify as miscellaneous itemized deductions are deductible only to the extent they exceed, in aggregate, 2% of your adjusted gross income (AGI). Bunching these expenses into a single year may allow you to exceed this “floor.” So now is a good time to add up your potential deductions to date to see if bunching is a smart strategy for you this year.

Don’t roll the dice with your taxes if you gamble this year

08_02_16-200325635-001_ITB_560x292.jpgFor anyone who takes a spin at roulette, cries out “Bingo!” or engages in other wagering activities, it’s important to be familiar with the applicable tax rules. Otherwise, you could be putting yourself at risk for interest or penalties — or missing out on tax-saving opportunities.

Should you make a “charitable IRA rollover” in 2016?

07_26_16-464804365_ITB_560x292.jpgLast year a break valued by many charitably inclined retirees was made permanent: the charitable IRA rollover. If you’re age 70½ or older, you can make direct contributions — up to $100,000 annually — from your IRA to qualified charitable organizations without owing any income tax on the distributions.