We are getting very close to the end of the third quarter in 2016 and if your tax bill for 2016 is likely to be much higher (or lower) than it was in 2015, now is the best time to take a look and adjust your income tax withholdings or estimated tax payments. It is also a good time to look at ways to potentially reduce your taxes due for 2016 and potentially save thousands of dollars.
There are several things that can be done before the end of the year and only a scant few things that can be done after 12/31 to reduce your tax bill so now is the time to look at things like:
- Deferring your income if you are going to be in a lower tax bracket in 2017 (moving bonus payments from 2016 to 2017).
- Accelerating income if you are going to be a higher tax bracket in 2017 (offer clients an early pay discount).
- Accelerating deductions from 2017 to 2016 (pay your property tax bill due in 2017 in 2016 or make your fourth quarter State estimated tax payment in 2016).
- Deferring deductions from 2016 to 2017 (pay your property tax bill due in 2017 in 2017 or make your fourth quarter State estimated tax payment in 2017).
There are also credits available for things like installing solar panels on your house… if you are thinking about doing that, doing it now will lower your 2016 tax bill.
Contact me today if you would like to see what options are available to you and how to minimize your tax bill.
William A. Olson CPA, 734-377-3641
RSS - Posts