Get ready for tax season.
- Download your pay stubs and end-of-year statements — bank accounts, credit cards, mortgage(s), student loans, investment accounts, etc. Save them in a folder for easy access.
- Pull up last year’s taxes to refresh yourself on what you filed. Save this with your other tax documents — having it handy might save you time filling out information on certain tax software programs.
- Check the balance on your Flexible Spending Account (FSA). Typically FSA funds are “use it or lose it” by year-end. So, plan to spend the funds fully if your employer doesn’t offer a grace period or allow a rollover into the new year.
- Review possible deductions for the year, including medical and dental expenses, child care expenses, educational expenses, mortgage interest, etc.
Assess any changes to your tax situation. Talk about making adjustments with your tax pro.
5. Did your income change this year — did your pay increase or decrease? Did you get a bonus?
- Did you have any stock options vest?
- Do you expect income to increase next year due to a promotion, new job, bonus, or equity compensation?
- Did you recently add a baby to the family, purchase a home, or get married?
Make contributions to tax-advantaged accounts.
- Contact your HR department to see if there’s still time to contribute to your traditional 401(k) by December 31. If so, contribute as much as you can.
- If you have an IRA, make a plan to max out your contributions by April of 2025. You must open and fund that account before April 15, 2025.
- If you have an HSA available, have already maxed out 401(k) and IRA contributions, and have more funds available, make a plan to max out contributions by April 15, 2025.
Make any donations to charity.
- Look at your December budget and decide how much you want to give.
- Choose a non-profit that aligns with your values. To be used in tax deductions, charitable giving donations must be made to 501(c)(3) organizations.
- Donate one time (or set up recurring donations and give more in 2024!).
By Ellevest Team