Tag Archives: Tax Deductions

Tax Findings and thoughts from the 2018 Tax Season as we cross the finish line, finally!

Frequently our posts here act as a diary, for clarification, look back, and for possible reference in the future.

With tax season officially ending today – thank goodness – we felt like no better time than the present to pin our thoughts on what we saw this tax season.

So here we go…

2018 New Tax Law Review and thoughtsUncle Sam

Initially as we entered the tax year, we heard rumors and complaints of higher taxes – which on our first few returns, we found inaccurate.

As we carried through tax season we found that there were winners and losers and we will try to explain in greater detail for future reference for this time next year and for possible planning… for the record it way generally very hard to anticipate the winners from losers in advance as each situation seemed to have it’s own twist.

This is in general and very broad terms – as there are always exceptions, especially when dealing with taxes..

First the losers:

Single Taxpayers – With many deductions no longer allowed, simple standard deduction caused lower write offs in many cases.

Folks with heavy real estate right offs – SALT -State and Local Tax – deduction limited many – For the record clumping did not work as well as we had hoped.

Folks and heavy tax state residences – Again due to SALT deduction, we saw limits being reached frequently.

Folks that just fell under the itemized deductions due to limitations from the new tax laws – Limited deductions held many under the standard deduction.

Charitable donors – but not heavily charitable donors – standard deduction comes in play.

And the winners:

Large Families – Child credit in play here – $2k credit per child helped.

Married couples – especially those that had been filing non-itemized returns in the past-higher deduction in play here – a net gain in the higher standard deduction.

Non Itemizers – Those filing regular standard tax returns, usually found meaningful benefit.

Business owners with qualified pass  through taxes – lower tax rate at work here.

Real estate holdings that were not high property tax but possibly had meaningful interest expense – Although SALT limited much, interest expense was not limited in many cases.

So what have we learned?

Given the lower marginal tax rates in certain situation it likely makes sense to accelerate IRA distributions if one is in the appropriate asset position.

Heavy property tax real estate holdings may have limits, the SALT limit will greatly affect the deductions of such holdings.

While salt clumping – The clumping the property taxes-may not work as well, charitable deduction clumping will work very effectively but needs planning. Clumping years of charity gifting to get over the standard deductions may provide greater benefit.

In closing, the thing we learned the most –

The new tax forms and all of their crazy schedules are horrible!

The effort to go to a simplified tax return was nice, however it over complicated the details of any non-simple tax return.

We hope that in the future many of the schedules are enlarged or pulled to the front as it is very difficult to reconcile and reconcile tax returns with the current forms.

Have a Great “Last Unofficial” Tax Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.


Last Minute Tax Deductions you MUST complete by 12/31 to receive on THIS Year’s tax return!

April Settle up for 2017 taxes is just around the corner. While there a many items that have reach back ability (Contributions can be made next year – 2018 and still help 2017 taxes) what follows are reminders that you MUST make before year end 12/31 to receive a current year (2017) deduction.

Due by 12/31 to Receive 2017 Tax ReliefUncle Sam

  1. Donations to charity – Must be completed this year as it is a same fiscal year deduction
  2. 401k Maxing – Remember to get your maximum deduction for your 401k that you desire – Maximums are currently $18k regular plus $6k over age 50 years young catch up
  3. Medical Expenses – While possibly late for a procedure, supplies, equipment or other medical expenses claimed for 2017 must be completed by 12/31
  4. Gifting of Money – While not a deduction, recall that an annual limit of $14k to each person is available and resets on 1-1 of the following year (Greater gifts will require a gift tax return)
  5. Accelerate Expenses- Never buy just to buy, but if something is needed and it is flexible enough in timing to pull forward, review your expected income this year versus next and see if it makes sense to make that purchase now

Have a Great “Less Taxable April 2018” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.



Year End Tax Tips – Clumping or Pushing Property Taxes

From now until near the end of the year we will be highlighting very special tax tips to help maximize your tax savings. Property Tax

Here is the first in a special tax savings series heading into year-end.

Clumping Your Property Taxes

If you have limited deductions, review your property taxes and see if it makes sense to clump two years into one

If you have been using standard deductions (not itemizing) see if clumping two property tax payments into one year will get you over the standard deduction – if it does, any extra dollars over your standard deduction will be a tax savings you otherwise would not have received.

Pushing Your Property Taxes Out a Year

If you have had a super year and may face a phase out in deductions due to a high income this year (at certain income levels you lose your deductions) you may want to consider pushing your property taxes into another year. If your deductions are partially or completely phased out, you may receive minimal tax benefit with ANY deductions.

There are a lot of moving parts in these situations, if you have a question give us a call — these are certainly not a recommendation to do either without further review.

Have a Great Tax Savings Wednesday!

John A. Kvale CFA, CFP

8222 Douglas Ave # 590
Dallas, TX 75225




A Dozen Common Tax Mistakes You Do Not Want to Make!

As we near the end of the tax season, we wanted to point you (click here) to our blog page that highlights our most common found tax mistakes. An important item to note, many of these are forgotten items made by us, the tax payer, not our professionals. There is also a handy link to the tax forms and a good tax estimator page.

Finalization of the big event on April 28th at 2pm is upon us, we will be notifying you shortly of the complete details.

Have a Great Day!




Clumping Deductions to Maximize Tax Benefit

The IRS gives each of us a standard deduction for Federal Income Tax purposes. According to the IRS Website, the standard deduction is a dollar amount which reduces the income in which you are taxed. This amount is adjusted for inflation and also increases at certain age levels.

Don't Let Taxes Drag You Down!

This deduction is certainly generous from and IRS standpoint, and acts as a floor for many of your deductions.  (The ultimate result of this deduction is a simplification of many tax returns for the IRS as a great number of returns only qualify for the standard deduction.)

If you are only qualifying for the standard deductions, here is a strategy for possibly maximizing your deductions every other year.

Clump your deductions: (Primarily your property taxes)

Once your mortgage is paid off, many times a tax payers biggest deduction, we have found individuals personal deductions often fall just under the floor of the standard deduction. A clever technique to maximize your deductions in alternating years, is to pay (“clump”) your property taxes in the same year, skipping the next year completely. This technique may push you over the standard deduction in alternating years and thereby give you a greater tax benefit.

In the clumping years, it may also help to maximize your discretionary donations, gifts, and charity activities, further maximizing your tax benefit.

We are not a CPA firm, and as such recommend you see your tax advisor for confirmation of your specific situation, but this technique may work for you!

Have a Good Day!