The official tax season start date has landed—JANUARY 29th. That’s next week.
This is your cue to start gathering everything you need for your tax appointment.
(Speaking of… have you booked yours with us yet? It’s early so there are still plenty of spots open, but they do fill up fast, so don’t put it off.
530-223-2277 )
And this is my cue to update you on tax items that could affect you. You know that tax laws change rapidly. It seems like there have been plenty of changes in Washington that have rolled down to Redding people like you and me the past few years. So, we’re staying vigilant in monitoring these changes to help you get access to the best tax benefits and protect you from potential issues.
1. The IRS chose to postpone the 1099K reporting that affects receiving digital payments for services or products. It doesn’t mean you don’t have to report the income, you just won’t receive a 1099K from PayPal or other favorite 3rd party payment platform.
2. There are some changes/improvements in “green energy” tax credits for homeowners, landlords, and vehicle owners. If you invested money into solar panels, energy-efficient windows or doors, electric vehicle(s), or anything else related to green energy this past year, don’t forget to share the details with us at your tax appointment (what was purchased, date of purchase, and the amount invested).
3. Student loan repayments can count as 401K contributions for some employees. Check with your Redding employer to see if they have a 401K matching policy. If you’re paying back your loans, this could be a great way to get some “free money” into your 401K.
4. The IRS has more funding to step up enforcement. They are focusing primarily on high-income earners and certain business entities, but that doesn’t mean they won’t look into your situation if you haven’t taken care of things.
I give you these insights so that you’re taking advantage of every opportunity. In this economy, that kind of insight can be a real game changer.
Now, last year, our wallets were stretched pretty thin by inflation. Things feel a little better right now for some, but not for everyone.
In a fluctuating economy, you find out just where you’re weakest in your financial situation. Now that we’re diving into a new year and with the realities of the past as a guide, let’s take this opportunity to look at how to make improvements in your situation.
Dennis Fritz’s Top 2024 Financial Strategies
“A nickel ain’t worth a dime anymore..” — Yogi Berra
In this climate where the economy and your wallet are sending you mixed signals, the smartest move is to arm yourself with knowledge and strategies that turn any challenges into opportunities.
You’ve got to figure out how to adjust for the bigger picture things that trickle down to affect your financial state in any year, but especially for this year.
So, let’s take a dive into some key financial areas that could help you survive financially this year – and even come out thriving(?)
2024 Financial Strategy #1: Debt management in a high-debt climate
We all know our national debt is high and the continued political turmoil means there’s a likelihood of tax policy revisions. Those decisions usually have a significant impact on your wallet. As the economy continues to fluctuate, it’ll be crucial for you to figure out how to tackle your own debt so you can find some solid ground financially.
Deeper insight: Focus on reducing high-interest debts first. Strategies like balance transfer credit cards or debt consolidation loans can be effective. And if tax changes do roll out, you know I’ll be here to keep you updated and offer key insights to keep you from tax debts getting added to your debt balance.
2024 Financial Strategy #2: Savings in a low-disposable-income environment
Even with a squeeze on disposable income, saving remains a critical component of financial health. With interest rates rising, your savings can work harder for you.
Deeper insight: Embrace automated savings plans. Small, regular contributions to high-yield savings accounts or CDs can lead to significant long-term growth. This approach is particularly effective in preparing for unexpected expenses or long-term financial goals.
2024 Financial Strategy #3: Insurance and tax planning for optimal savings
It’s time to review insurance policies to make sure you’re not paying more for insurance than you should. There could be savings possible if you double-check that your insurance costs are reflective of your current life situation.
The same goes for taxes. When your life situations change, it could mean restructuring or making moves that will actually benefit your tax standing with the IRS. If you don’t, you could be paying more than you should or you could be missing out on real deductions and credits.
Deeper insight: Schedule an insurance review and tax planning appointment and plan to do those on an annual basis. Look for changes in life circumstances that might lower premiums. On taxes, consider strategies to maximize deductions and utilize tax-advantaged accounts. Consulting with a tax professional can help identify opportunities tailored to your specific situation. We’re glad to be that person for you (it’s what we love).
2024 Financial Strategy #4: Preparing for a recession
While the talk of recession has receded somewhat, the possibility does still loom in the background. If it does rear its ugly head, you obviously want to be financially prepared to face it.
Deeper insight: Prioritize building a robust emergency fund this year. Aim to save enough to cover several months of living expenses. This fund acts as a buffer against unexpected financial shocks.
Additionally, focus on budgeting effectively and continue reducing debts to strengthen your financial position.
This year, understanding and acting on these key 2024 financial strategies can make a big difference in the stability of your financial world. As we head into an election year and continue to navigate the complexities of tax law changes, changing interest rates, and other financial factors, staying focused on improving things for you will be more important than ever.
And remember, we’ll always work to keep you informed. If you want help from a reliable Shasta County professional with your situation, my team and I are here and ready to help.
Getting you on solid financial ground this year,
Dennis Fritz