Strategic Tax Planning: What to Tackle Before December 31st

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As the year comes to a close, now is the time to finalize key strategies that can optimize your tax situation and help you stay aligned with your financial goals.

At Connecticut Wealth Management (CTWM) we understand that tax planning can sometimes feel overwhelming. That is why we prioritize this critical work year-round. With year-end approaching, our team is focused on putting these plans into action. From maximizing savings to anticipating future opportunities, our advisory team manages every detail so that you can focus on what matters most.

Your Year-End Tax Planning Checklist

Here are some of the key strategies we evaluate to help optimize your tax situation and ensure your financial plan stays on track.

  1. Maximizing Tax-Efficient Contributions: Contributions to your 401(k), IRA, or Health Savings Account (HSA) can help lower your taxable income while building your future savings.
  2. Taking Advantage of Roth Conversions: Converting a portion of your traditional IRA to a Roth IRA can help you benefit from tax-free growth in the future, especially if you are in a lower tax bracket this year. With potential tax rate increases in 2026, this strategy could be particularly advantageous now.
  3. Optimizing Charitable Giving: We explore strategies such as donor-advised funds (DAFs) or gifting appreciated securities to reduce your tax burden while still supporting the causes you care about.
  4. Evaluating Capital Gains: If you hold appreciated stock, our team helps identify opportunities to realize gains at a 0% tax rate under specific income thresholds.
  5. Managing Required Minimum Distributions (RMDs): If you are 70½ or older, we ensure you meet RMD requirements to avoid penalties. For those who do not need the income, a qualified charitable distribution (QCD) may offer a tax-efficient solution, allowing individuals to transfer up to $105,000, or $210,000 for married couples filing jointly.

Through proactive planning and personalized strategies, our advisory team strives to reduce your tax liability and position your financial plan for long-term success.

Business Owner Insights

For business owners, tax planning is even more nuanced with your personal and business finances closely intertwined. Our team helps you navigate these complexities, evaluating:

  • Income Fluctuations: Changes in your income may allow for strategies like deferring income or accelerating expenses to optimize your tax position.
  • Mergers & Acquisitions: We continue to hear from more and more business owners who are looking to sell their business. If you are considering selling yours, early planning is essential. Our business advisory team can guide you through the financial, tax, and legacy considerations of this significant decision.
  • Corporate Transparency Act: A recent nationwide injunction has paused enforcement of the Corporate Transparency Act (CTA), meaning no further action is required currently. For those who have already filed, you are all set. Our team continues to monitor developments on the CTA to ensure you remain informed and prepared.

The Team Behind the Strategy

Executing year-end tax planning is a collaborative effort and we are proud to have an incredible team working behind the scenes.

A special thank you to our Client Service Specialist team, who ensures every detail is addressed with precision and care—from coordinating with tax preparers to ensuring timely fund distributions. Their dedication helps bring your tax strategy to life!

Pictured from left to right: Ashley Fleming, Sarah Scheide, Danielle Tata, Katelyn Marien, Cyndy Borenstein, Daniela Stringa, Rachel Puleo, Rachel Jase, Jessica Pedrolini, Lauren DellaFera | Not pictured: Meredith Pickett

Planning for 2025 and Beyond

While significant tax changes are not expected in 2025, staying ahead is key. Our team is closely monitoring legislative updates and tax policy changes that have the potential to impact your plan.

Whether you are an individual investor or a business owner, CTWM’s personalized, team-based approach ensures no opportunity is missed. Contact us today to finalize your year-end tax strategies and position yourself for success in the coming year. Let’s work together to align your tax planning with your financial goals!