© 2020 Arizent. All rights reserved.

2019 refunds might be higher, lower or later than usual: Tax Strategy Scan

Register now

Your clients’ 2019 tax refunds might be higher, lower or later than usual
Clients can expect their tax refunds to be bigger or lower this year, depending on how the new changes to the tax code will affect their actual tax situation, according to this article on The New York Times. However, the partial government shutdown could delay the release of tax refunds. “When the government is not functioning, it’s quite scary for households,” an economist with Morgan Stanley said. “You’re just going to pile up on top of another big pile of uncertainty, if their tax refunds are delayed.”

Tax season opens: Clients can file federal taxes starting today
Taxpayers can now start filing their 2018 tax returns, as the tax season officially kicked off Jan. 28, according to this article on USA Today. To prepare their returns, clients need to gather all their receipts, W-2s and other tax documents. They should also review their old returns to remember their available tax breaks and expected changes as a result of the new law.

Overlooked tax strategies as clients approach retirement
Retirees who want to minimize the tax burden on their income should hold on to their investments for more than a year before selling to owe zero taxes on capital gains, a CFP on Kiplinger writes. They also have the option of donating the mandatory distributions from their tax-deferred accounts directly to charity through a qualified charitable distributions to avoid taxation on the withdrawals. Converting traditional IRA assets into a Roth account, getting the net unrealized appreciation and using strategic investment withdrawals can also help retirees reduce the tax bite on their earnings.

How clients can stay tax compliant when retiring overseas
Americans who consider relocating abroad in retirement are advised to have a comprehensive plan in place before making the move, an expert at U.S. News & World Report writes. That's because they will still face tax obligations in the U.S. even if they retire abroad, and are likely to be subject to more tax rules in their new country of residence, the expert explains. "Certain options for reducing your local tax bill can come off the table once you've taken a local address, the expert says. “You should seek American and local legal advice."

What some clients tried to claim on their tax returns shows they often don't know much about accounting.
February 5

4 tips to survive the 2019 tax season
Clients who want to survive the tax season this year are advised to start doing their taxes as early as possible, according to this article on Motley Fool. They should also have a list of all important tax forms and keep track of these documents to ensure that they will receive them on time and provide accurate details on their returns. Taxpayers are advised to determine whether they will save more on taxes by itemizing instead of opting for the standard deduction. Those who have simple tax situation should consider doing their own taxes by filing returns electronically to save on tax preparation fees.

For reprint and licensing requests for this article, click here.