2013 Tax Planning Options After Year End

In the new year, there are two actions one should keep in mind, which may affect the prior year’s tax liability: 

(1) Contributions to retirement plans
(2) Wash-sales
Contributions to Retirement Plans
  • Conventional and Roth IRA contributions can be made until April 15th and be considered a payment in 2013.  Contribution limits for 2013 are $5,500 for those under 50, and $6,500 for those 50 and older.  The adjustment phases out starting at $112,000 for single taxpayers and $178,000 for those filing a joint return.
  • Keogh, SIMPLE, and 401(k) contributions can be made until the due date of the return. These plans must be established by September 30, 2013 to be included.
  • SEP plans can be opened and funded until the due date of the return (including extensions).
Wash Sales
A wash-sale transaction occurs when a stock is sold and subsequently repurchased within 30 days of the sale.  If a wash-sale occurs, the loss on the initial transaction is disallowed and added as an adjustment to the basis.  These rules should be considered when making investment transactions in the new year.
I am happy to discuss particulars should either of these scenario’s apply to you personally!
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