Is it time to start thinking about your Section 199A deduction? If the end of the year is approaching, the answer is yes—that’s the best way to ensure that you’re able to claim a deduction at all! If you have income that is $157,000 or more, then it’s possible to reduce or even eliminate your Section 199A tax deduction. Here’s how you can steer clear of that.
- If you have any capital losses that are threatening to cut down on your Section 199A deduction, you should harvest them now, while you still have the time to do so. Selling off these stocks or securities will help to protect your deduction.
- Making charitable contributions is another smart step you can take in order to keep your deduction from being reduced. You may want to either donate any appreciated stock you have or prepay any contributions you are already planning to make in 2019.
- You can even contribute to your retirement account to reduce the amount of income you have that is taxable! Keep in mind that money in a retirement account is generally untouchable by taxes as long as it stays in the account.
- You can also write off any business assets you purchase and begin using before the last day of 2018. This will reduce your taxable income and can also help to increase your Section 199A deduction.
If you’re looking for an experienced accountant to help you with your taxes this year, The Royce CPA Firm can help. We help individuals, families, businesses, and nonprofits in Tucson with tax preparation. Fill out our online form today to set up an appointment!