Preparing for Year End
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Ready for 2024?
As the end of the 2023 approaches, we want to be reminded of last-minute items we need to finalize and the goals we want to complete. Here are some of those year-end items you may want to look over and review with your Gilbert & Cook Advisor.
Annual Exclusion Planning
Plan contributions to education accounts and make any desired cash gifts to family members. The annual federal gift tax exclusion allows you to give away up to $17,000 in 2023, meaning you can gift as much as $17,000 to as many individuals as you like this year. Such gifts do not count against the lifetime estate tax exemption amount as long as they stay beneath the annual federal gift tax exclusion threshold.
The end of the year is also a good time to review any trusts you have in place. Using a trust involves a complex set of tax rules and regulations. Before moving forward with a trust, consider working with a professional who is familiar with the rules and regulations.
Charitable Giving
Individuals can donate cash, appreciated stock, or make donations via a qualified charitable distribution if they are 70 1/2 years old or older. A qualified charitable distribution is a distribution from your Individual Retirement Account (IRA) that can be excluded from income if donated to qualifying charities. The 2023 allowable amount is $100,0000 per taxpayer.
Please consult with your CPA and Advisor to determine if any of these strategies will benefit you.
Retirement strategy
If you aren't already, you may want to consider contributing the maximum to your retirement accounts and review any existing retirement accounts with your employer. If you are eligible to make any catch-up contributions, it may be a great time to also consider making that decision.
2023 limits for individuals:
$22,500 for 401(k) with $7,500 catch-up provision for individuals 50 and over.
$15,500 SIMPLE plans with $3,500 catch-up contribution for individuals 50 and over.
$6,500 Roth IRA / IRA contribution; $1,000 catch-up contribution for individuals 50 and over. 1
Taxes
It's a good idea to consider checking in with your tax or legal professional before year end to discuss questions regarding large expenses or deductions. Think about any sales of property as well as both realized and unrealized losses and gains. Your Gilbert & Cook Advisor can work alongside your tax or legal professional to help provide this information and to also help plan for 2024.
Life Events
Here are some questions to ask yourself when evaluating any large life changes in the last year:
Did you happen to get married or divorced this year?
Did you move or change jobs?
Did you buy a home or business?
Was there a new addition to your family this year?
Did you receive an inheritance or a gift?
All these circumstances can have a financial impact on your life as well as the way you invest and plan for retirement and wind down your career or business. As always, your Gilbert & Cook team is here for you. Please talk to your Advisor if you have any questions regarding your financial situation.
