
Income Tax Planning
Are you tired of financial advisors who only talk about investments? We often hear, "I need tax and retirement advice, too. Can you help?" 🎯Absolutely! Embrace Wealth Management offers a full spectrum of services to cover all your financial needs.
Income Tax Planning
We help you reduce taxes over your lifetime to keep more of your money. By reviewing your tax returns, we identify planning opportunities. This includes Tax-Efficient Investing, Asset Location, Tax Loss Harvesting, Capital Gain Harvesting, Retirement Distribution Planning (RMD), Roth Conversions, Charitable Giving, and addressing potential tax "surprises" like Medicare Surcharges (IRMAA), Net Investment Income Tax (NIIT), and the Widow Penalty.
Additionally, we can model different scenarios to see how adjustments, such as changing your filing status, dependents, business transactions, or stock choices, affect your taxes.
* This information is not intended to substitute for specific individualized tax advice. We suggest you discuss your specific tax issues with a qualified tax advisor.
Tax-Smart Withdrawals: Making Your Retirement Savings Last Longer
You've built your nest egg, invested in brokerage accounts, and have 401(k)s and Roth IRAs. Now that you're retired, which account should you withdraw from first?
Discover how a smart, tax-efficient distribution strategy can extend the life of your retirement funds and make them work harder for you.
FAQ
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Whether you need to file depends on your income, age, and filing status. The IRS sets minimum income requirements each year. Even if you are below the threshold, filing might get you a refund if you had taxes withheld or qualify for credits. Check the latest IRS guidelines or use their online tool to confirm your filing requirement.
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Your filing status affects your tax brackets, standard deduction, and eligibility for credits. Head of household status is available if you are unmarried and support a dependent. Married couples can often save by filing jointly, but sometimes separate returns make sense. Review your living situation and dependents to select the best status for your situation.
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You may qualify for credits like the American Opportunity Credit or Lifetime Learning Credit, which can reduce your tax bill for tuition and related expenses. Student loan interest is also deductible up to a certain limit. Save receipts and Form 1098-T from your school to claim these benefits.
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All income, including from side gigs or online sales, must be reported—even if you do not receive a 1099 form. Keep detailed records of your earnings and related expenses. You may need to pay self-employment tax and make estimated tax payments throughout the year.
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After filing, use the IRS “Where’s My Refund?” tool online or via the IRS2Go app. You will need your Social Security number, filing status, and refund amount. Most refunds are issued within 21 days, but errors or incomplete returns can cause delays.
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For 2025, you can contribute up to $7,000 to an IRA (plus $1,000 catch-up if age 50+), and up to $23,500 to a 401(k) (plus $7,500 catch-up if age 50+). Maxing out contributions can lower your taxable income and boost retirement savings.
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Long-term capital gains (assets held over a year) are taxed at lower rates than short-term gains. Use tax-loss harvesting to offset gains with losses, and consider holding investments longer for better rates. Plan sales strategically, especially near year-end.
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If you are age 73 or older, you must take RMDs from traditional IRAs and most employer retirement plans. These withdrawals are taxed as ordinary income, and failing to take them can result in steep penalties. Plan your withdrawals to manage your tax bracket and consider charitable qualified distributions.
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Watch for errors like missing or incorrect Social Security numbers, math mistakes, and forgetting to sign your return. Double-check bank details for direct deposit and ensure all forms are included. Filing electronically can help catch many common errors.
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Maximize contributions to retirement accounts, HSAs, and FSAs. Consider charitable donations, bunching deductions, and tax-efficient investment strategies. Review your portfolio for opportunities to defer income or accelerate deductions, and consult a Certified Financial Planner (CFP) or tax professional for advanced planning.