If you have had a bigger than normal year, or had a larger taxable income from other outside items, this may be a good year to do one of our favorite tax tips. Every situation is different and we do not want the tax tail to wag the dog, but if you have an option, and the situation is correct, this may be a good idea.
Delay that Income Until Next year
While is in not always possible to change your income, there are situations when you may be able to easily delay your income. These tactics are particularly helpful if you have had a larger than normal year. Of course, do not push it all into next year as you will have just delayed the inevitable or possibly even made next year a mountain versus the mole hill it may have been.
- Consultants that bill their employer- wait until next year
- Ask your boss to hold on to that bonus until next year if your income may dip or is already higher than normal this year
We hope this list serves as a reminder and might put you in a better place with a small adjustment near the end of the year. Every situation is different, but hopefully we have planted a seed!
Have a Great “Less Taxing” day!
John A. Kvale CFA, CFP