The 2024 tax filing deadline (April 15, 2025) is fast approaching, but you still have time to make sure your tax-advantaged savings vehicles are maximized and potentially lower your tax bill. Following are a few last minute reminders regarding 2024 taxes:
· Maximize your 2024 IRA contribution. The maximum contribution for 2024 is $7,000 (plus an additional $1,000 for those age 50 and over) and you have until the tax filing deadline to complete funding. If you plan to fund your contribution via electronic fund transfer, check with your custodian for the cutoff date to make sure your funds arrive on time. As a backstop, you can always mail a check to your custodian and the contribution will count for 2024 as long as it’s postmarked by April 15th.
· For small business owners, you may be able to save even more with a SEP IRA. If you were self-employed in 2024, you can generally set aside up to 20% of your net income up to $69,000 and you have until the due date of your return (including extensions) to complete funding.
· Maximize your Health Savings Account (HSA) contribution if eligible (to fund an HSA contribution for 2024, you must have been enrolled in a qualified high-deductible health plan). For individuals, the maximum contribution is $4,150 for 2024 and for families, it’s $8,300 (plus an additional $1,000 for those age 55 and over).
· If saving for higher education expenses for family members or yourself, you can fund Edvest contributions up until the tax filing deadline. The maximum deduction for Wisconsin is available with a contribution up to $5,000 per beneficiary.
It’s certainly not too early to begin planning for 2025 taxes as well. Remember that to “file safe” (avoid underpayments penalties), taxpayers must pay in the lesser of 100% of the prior year’s tax liability or 90% of the current year’s tax liability (for those with income over $150,000, the safe harbor increases to 110% of the prior year’s tax liability). After you complete your taxes, be sure to update your payroll withholdings or make quarterly estimated tax payments, if necessary, to avoid unwanted fees.
You can also get a head start on maximizing tax-advantaged savings vehicles for 2025.
The above statistics and/or commentary have been obtained from sources we believe are reliable, but we cannot guarantee their accuracy or completeness. Past performance is no guarantee of future results.
The information contained in this document does not cover all tax strategies that may apply, is not a complete guide to tax planning, and does not constitute the rendering of legal, accounting, or other professional advice or opinions on specific facts or matters. Before implementing any ideas suggested here, consult with your tax advisor regarding your specific tax situation.
Talk to your financial and tax advisors before acting on information in this document.