<p>Did you hear about the guy who paid his taxes to the IRS with a smile? It didn’t work out, though—it turns out they prefer money.</p><p>Well, paying taxes is certainly no laughing matter, and we don’t want to miss something that could end up costing us money. Fortunately, Kevin Cross is here today with a list of year-end tax tips you don’t want to miss.</p><p><a href="https://kevincrosscpa.com/">Kevin Cross</a> is a Certified Public Accountant (CPA) who has headed CPA firms in Florida and now Georgia. He has studied the tax code extensively and specializes in representing taxpayers before the IRS. </p><h3>2024 Year-End Tax Strategies</h3><p>As the end of 2024 draws near, these are some critical financial moves that can help you maximize your tax savings: </p><h3>1. Review Withholding and Estimated Payments</h3><p>The first step in year-end tax prep is to check how much you’ve paid in taxes this year. Avoid underpaying (which leads to penalties) or overpaying (which gives the government an interest-free loan on your money). For those behind on withholding, consider adjusting your remaining paychecks to make up the difference.</p><h3>2. Max Out Retirement Contributions</h3><p>Contributing to a retirement account like a 401(k) or IRA is one of the best ways to lower your taxable income. For high-income earners, consider a “backdoor Roth IRA”—a strategy involving non-deductible IRA contributions converted to a Roth IRA, providing tax-free growth.</p><h3>3. Optimize Charitable Contributions</h3><p>Charitable giving is a powerful tax strategy, especially if you bundle multiple years of contributions. By “bunching” donations, you may surpass the standard deduction threshold, allowing you to itemize and benefit from your generosity. A <a href="https://www.ncfgiving.com/?gad_source=1&amp;gclid=CjwKCAiAudG5BhAREiwAWMlSjJ5sCMoZbdV_VG5x2JKI-1jrRUqNM6jNV7fuCXM_nGqzhREwEc7qOBoC-hsQAvD_BwE">donor-advised fund (DAF)</a> can streamline this process, allowing you to make a large donation this year and distribute it to charities over time.</p><h3>4. Donate Appreciated Assets</h3><p>Consider donating appreciated stocks or mutual funds to avoid paying capital gains tax on the appreciation. For example, if you bought stock for $1,000 and it’s now worth $1,500, donating it allows you to deduct the full $1,500 without incurring capital gains tax on the $500 gain.</p><h3>5. Qualified Charitable Distributions for IRA Holders</h3><p>For those 70½ or older, Qualified Charitable Distributions (QCDs) from an IRA allow you to donate directly to charity without counting the distribution as taxable income. This is particularly helpful if you’re taking the standard deduction.</p><h3>6. Take Advantage of Section 121 Exclusion on Home Sales</h3><p>Section 121 of the tax code allows homeowners to exclude up to $500,000 in capital gains (for married couples) when selling their primary residence, provided they’ve lived in it for at least two of the last five years. This is a significant opportunity for those considering selling their homes in a high-appreciation market.</p><h3>7. Avoid Underpayment Penalties</h3><p>Quarterly estimated payments are essential to avoid IRS interest and penalties if you're self-employed or a gig worker. Failure to pay quarterly could result in a penalty that acts like interest on unpaid taxes, making it costlier than paying in installments.</p><h3>8. Don’t Ignore Past Tax Issues</h3><p>If you’re behind on tax filings or payments, now’s the time to act. Many individuals feel overwhelmed, but taking the first step to seek professional help can bring peace and clarity. We advise you to contact a CPA with IRS experience to assist with this process.</p><p>These strategies can help you make the most of tax season and avoid paying more than necessary. Remember, the tax code is complex, and each situation is unique, so consulting with a CPA, especially one experienced in IRS negotiations, can provide personalized guidance. </p><h3>On Today’s Program, Rob Answers Listener Questions:</h3><ul><li>I have some rental properties that I'm worried will be sold for cheap at auction after I'm gone since my kids in California don't want to return to Arkansas. Should I sell the properties and put the money in a trust for my grandkids' education?</li><li>I'm contributing 15% of my income to my 401(k), and my employer matches 5%. But I'm trying to build up my emergency savings, and I'm only at about two months' worth right now. Should I stop contributing to my 401(k) for now so I can focus on getting my emergency fund up to 6 months' expenses?</li></ul><h3>Resources Mentioned:</h3><ul><li><a href="https://kevincrosscpa.com/">Kevin Cross, CPA</a></li><li><a href="https://www.ncfgiving.com/">National Christian Foundation (NCF)</a></li><li><a href="https://www.faithfi.com/sparrows">Look At The Sparrows: A 21-Day Devotional on Financial Fear and Anxiety</a></li><li><a href="https://www.faithfi.com/rtg">Rich Toward God: A Study on the Parable of the Rich Fool</a></li><li><a href="https://www.faithfi.com/find">Find a Certified Kingdom Advisor (CKA) or Certified Christian Financial Counselor (CertCFC)</a></li><li><a href="https://www.faithfi.com/manage">FaithFi App</a></li></ul>
<p><p>Remember, you can call in to ask your questions most days at (800) 525-7000. Faith &amp; Finance is also available on the <a href="https://www.moodyradio.org/programs/faith-and-finance/">Moody Radio Network </a>and <a href="https://afr.net/podcasts/faith-finance/">American Family Radio</a>. Visit our website at <a href="https://www.faithfi.com/">FaithFi.com </a>where you can join the FaithFi Community <a href="https://www.faithfi.com/give">and give </a>as we expand our outreach.</p></p>

FaithFi

Faith & Finance is a daily radio ministry hosted by Rob West. The program offers a practical, biblical and good-natured approach to managing your time, talents and resources.

Faith & Finance with Rob West

Did you hear about the guy who paid his taxes to the IRS with a smile? It didn’t work out, though—it turns out they prefer money.

Well, paying taxes is certainly no laughing matter, and we don’t want to miss something that could end up costing us money. Fortunately, Kevin Cross is here today with a list of year-end tax tips you don’t want to miss.

Kevin Cross is a Certified Public Accountant (CPA) who has headed CPA firms in Florida and now Georgia. He has studied the tax code extensively and specializes in representing taxpayers before the IRS.

Year-End Tax Tips with Kevin Cross

FaithFi: Faith & Finance | Nov 20, 2024

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