Written by Tax Controversy Attorney Shad Brown
It is the time of the year when we all look back on another year past in hopes of identifying a few areas we can improve in the year to come. If you are at all like me that list is a little longer than you would have hoped. Nonetheless, the new year bring a chance to start over and do some of the things we meant to do but didn’t get around to. It is in this spirit that I came up with my tax and estate New Year’s resolutions we should all follow.
1) Maximize contributions to retirement accounts. The maximum an individual can contribute to an IRA in 2014 is $5,500. This amount can then be deducted from gross income when computing your income tax, reducing the amount of income tax you will pay. Likewise, contributions to employer sponsored retirement account, such as a 401(k) or 403(b) plan, are not included in your gross income. Matching contributions by your employer are also excluded from your gross income.
2) Fund your trust. More than half of all trusts are not fully funded. What does this mean? It means your assets are not in your trust. Assets outside your trust mean you are going to end up in probate court when you eventually die. The main reason you created the trust in the first place was to avoid probate. Make sure your assets are in your trust so that you get what you paid for. Don’t know where to start? Contact the trusted tax and estate attorneys of the Dana Law firm to get started.
3) Resolve those IRS issues you are ignoring. Everyday I meet someone who has an unresolved issue with the IRS. They all hoped it would go away if they ignored. It never does and usually only continues to get worse. We all fear the unknown. That is why it is important to enlist a guide who understands your situation and can develop a strategy that can put your unresolved tax issue behind you for guide. Our experienced Arizona tax attorneys have seen it all and can help you resolve any tax problem.