12/31/20
Year End Tax Planning Tips
Year end strategies covering charitable deductions, capital loss harvesting ($3,000 offset and the 31 day wash sale rule), Virginia 529 deductions ($4,000 per child), HSA/FSA updates, and Traditional to Roth IRA conversions.
Capital losses can offset realized capital gains plus up to $3,000 of ordinary income for married filing jointly, provided you wait at least 31 days before repurchasing the same security to avoid a wash sale.
529 plans grow tax free for qualified education, and Virginia allows a $4,000 per child state taxable income deduction. Converting a traditional IRA to a Roth IRA can lock in current tax rates and eliminate future Required Minimum Distributions (RMDs) once the five year and age 59.5 rules are met.