Year-End Tax Planning: Key Takeaways from Brooklyn Fi's 2024 Webinar

This timely webinar was hosted by John Owens, Managing Partner at Brooklyn Fi, along with Caitlin Fastiggi (Director of Financial Planning) and Tiffini Parker (Tax Manager). They tackled crucial year-end tax planning strategies and addressed potential changes under the incoming Trump administration.

Business Owner Year-End Tax Planning

 

Business Revenue Strategies

  • Defer revenue into next year when possible

  • Hold off on sending December invoices

  • Consider credit card timing for expenses

Business Expense Planning

  • Accelerate expenses before year-end

  • Prepay early January expenses in December

  • Use business credit cards strategically

  • Track startup costs even before business formation

Home Office Deductions

  • Mortgage interest and real estate taxes portions

  • Utilities and office-related expenses

  • Cell phone and internet services

  • Business-related travel expenses remain deductible

Business Retirement Account Strategies

  • Goal: save about 20% of yearly net income

  • Solo 401(k) contribution limits:

    • Employee contribution: $23,000 for 2024

    • $7,500 catch-up for 50+

    • 20-25% of earnings as employer contribution.

  • December 31st deadline for employee contributions

  • Employer portions may have extended deadlines

Personal Year-End Tax Planning

 

Personal Tax Planning Opportunities

  • IRA contribution limit: $7,000 ($8,000 if over 50)

  • 401(k) contribution limit: $23,000 ($30,500 if over 50)

  • 529 plan state tax benefits vary:

    • New York: $5,000 single/$10,000 married deduction

    • New Jersey: $10,000 deduction (income limits apply)

    • California: No state tax deduction

Charitable Giving Strategies

  • Consider donor-advised funds for tax flexibility

  • Donate appreciated stock to maximize benefits

  • Bundle multiple years of giving for a larger deduction

  • Keep detailed records of all charitable contributions

  • Consider state tax implications of charitable giving

Important Deadlines

  • December 31: 401(k) employee contributions

  • January 15: 4th quarter estimated taxes

  • January 31: Tax engagement letter deadline

  • February 15: Tax document submission deadline

  • April 15: Final 2024 taxes and Q1 2025 estimates

Investment Tax Planning

  • Tax loss harvesting considerations

  • Direct indexing pros and cons

  • Asset location strategies

  • Long-term vs short-term gains planning

Future Tax Policy Changes

Potential Trump Tax Changes

  • Making 2017 tax cuts permanent

  • Eliminating taxes on tipped wages and overtime

  • Removing Social Security benefit taxation

  • Restoring auto loan interest deductions

  • Possible tariffs on imported goods

  • Extending current estate tax provisions

Planning Considerations Going Forward

  • Most tax cuts likely to be extended rather than permanent

  • State tax planning may have a bigger impact than federal changes

  • Continue maximizing retirement accounts

  • Consider the timing of charitable contributions

  • Review estate planning needs, but major changes may be unnecessary

 

Need More Tax Planning Help?

Whether you're a business owner juggling quarterly estimates or an employee maximizing retirement contributions, Brooklyn Fi can help align your tax strategy with your financial goals. Our team combines tax expertise with comprehensive financial planning to optimize your tax situation year-round.

Have more questions about this taxing time? Talk to a Brooklyn Fi advisor today. 





John Owens