It’s time for year-end tax planning. If you do nothing else, go over your 2025 deductions for state and local taxes and charitable donations https://t.co/oqKsnmVPaw ...

Core Insights - Many individuals mistakenly believe their financial situation is satisfactory until they uncover significant gaps that can lead to financial losses, wasted time, and stress [2] - Common financial mistakes include lack of a cohesive investment strategy, neglecting tax implications, and failing to maintain an updated estate plan [2][8] Group 1: Investment Strategy - A prevalent mistake is building a portfolio without a comprehensive plan, leading to investments that are poorly aligned with personal financial goals, resulting in high fees and low tax efficiency [3][4] - The recommended approach is to establish a financial plan that outlines risk tolerance and time horizon, followed by an investment policy to guide asset allocation [4] Group 2: Tax Considerations - Tax inefficiencies often arise from having actively managed funds in taxable accounts, which can lead to unexpected capital gains due to large dividend payouts [5] - Transitioning these investments to tax-advantaged accounts or opting for more tax-efficient funds can help retirees retain more of their earnings [5] Group 3: Retirement Accounts - Individuals frequently overlook old 401(k) accounts from previous jobs, which may carry high fees and suboptimal investment options [6] - Consolidating these accounts can simplify performance tracking, reduce fees, and maintain a consistent investment strategy [6] Group 4: Estate Planning - Neglecting to update estate plans is a common oversight, with many clients lacking a current and properly executed estate plan [9] - It is crucial to ensure that wills, trusts, and powers of attorney reflect current wishes and are effectively implemented [9]

Tax Planning - Proper planning can help avoid costly errors and big tax hits when transferring a 401(k) to an IRA [1]

Core Insights - The article emphasizes the importance for baby boomers to make strategic financial moves in the final months of 2025 to prepare for retirement and the upcoming year [2][3]. Group 1: Financial Strategies for Baby Boomers - Maxing out retirement accounts such as 401(k)s, IRAs, and Roth IRAs is crucial for boomers still in the workforce, as it allows for compounding growth and tax advantages [4][5]. - For individuals aged 73 or older, planning for required minimum distributions (RMDs) is essential to avoid penalties, with a deadline of December 31 for most and April 1, 2026, for those who turned 73 this year [6]. - Charitable donations can help reduce tax burdens for those aged 70 1/2 and older, allowing them to bypass RMD rules by donating up to $108,000 directly to charities [7]. - Considering a Roth conversion can be beneficial for many boomers, as it allows them to settle tax obligations on pre-tax retirement accounts sooner, potentially leading to long-term gains despite an immediate tax bill [9].

Core Insights - CBIZ, Inc. has released its 2026 Tax Planning Guide to assist businesses and individuals in navigating the changes brought by the One Big Beautiful Bill Act (OBBBA) [1][2] Group 1: Key Changes and Provisions - The OBBBA introduces significant tax policy changes, including immediate deductibility of domestic research and experimental expenses, restoration of 100% bonus depreciation, permanent expansion of Section 179 expensing, and increases to estate and gift tax exemptions [3] - New tax incentives under the OBBBA affect both C corporations and pass-through entities, prompting businesses to reconsider their entity selection [4] Group 2: Tax Planning Strategies - The guide emphasizes tax planning as a growth driver rather than a year-end checklist, encouraging decision-makers to transform complexity into clarity and strategy into savings [3] - The guide includes a sector-by-sector analysis to help organizations identify opportunities and compliance priorities in light of the new provisions [8] Group 3: Additional Provisions - Manufacturers can now claim a 100% deduction for new qualified production property, with construction starting after January 19, 2025, and before 2029 [8] - Expanded Qualified Opportunity Zones provide new avenues for capital-gain deferral and reinvestment for both business and individual investors [8] - New individual tax-advantaged provisions include higher state and local tax caps, new deductions for tip income and overtime pay, and temporary bonus deductions for seniors [8] Group 4: Upcoming Events - CBIZ is hosting a webinar on November 13, 2025, to discuss insights from the guide and the implications of tax changes for businesses and personal finances [5]

Core Insights - A woman named Sarah discovered her former employee benefits account is now worth approximately $18 million, potentially linked to a tech giant like Nvidia [2][3] - Financial expert Dave Ramsey advises her to diversify her investments and be cautious about tax implications from selling shares [3][4] Investment Strategy - Ramsey emphasizes the importance of not having a significant portion of net worth tied to a single stock, labeling it as "scary and unwise" [3][5] - He recommends consulting with a tax planner or investment adviser to minimize tax liabilities while diversifying her portfolio [5][6] Tax Considerations - The maximum federal capital gains tax rate for high earners is 20%, with an additional 7% state tax applicable in Washington State [4] - Selling even a small fraction of the account could push Sarah into the highest tax bracket, necessitating careful planning [3][4]

Core Insights - Mark Cuban disclosed a tax payment of $275.9 million for the previous year, expressing pride in fulfilling his tax obligations as a civic duty [1] - His approach serves as a model for everyday taxpayers, emphasizing the importance of accurate filing and avoiding penalties to lower tax bills [2] Tax Strategies - **Accurate Filing**: Cuban advocates for paying what is owed and ensuring accurate tax filing to avoid penalties and interest, which can inflate tax bills [2] - **Utilizing IRS Direct File**: He encourages taxpayers to use the IRS Direct File program for free e-filing, which reduces errors, preparation costs, and speeds up refunds [3] - **Capital Gains Planning**: Cuban's significant tax bill is largely due to long-term capital gains, highlighting the importance of timing transactions to manage tax liabilities [4] - **Smart Savings**: Utilizing tax-free bonds has helped Cuban reduce taxable income, while everyday taxpayers can benefit from maximizing contributions to retirement accounts like 401(k)s and IRAs [6] - **Charitable Giving**: Cuban views tax payments as a contribution to society, suggesting that taxpayers can lower their tax bills through charitable donations, which also support meaningful causes [7]

Core Insights - The article emphasizes the importance of actively managing finances in retirement despite having more leisure time, highlighting the need for strategic adjustments to protect savings against rising costs and changing tax rules [1] Group 1: Medicare Optimization - Retirees should optimize their Medicare plans during the Fall Open Enrollment period, which runs from October 15 to December 7, by comparing current plan costs, networks, and drug coverage against alternatives [3][4] - The standard premium for Part B has increased to $185 per month, while Part D caps annual out-of-pocket drug costs at $2,000 [3] Group 2: Tax Planning - A smart tax plan for 2025 should include deliberate planning of tax brackets, considering partial Roth conversions, and a tax-efficient withdrawal sequence to manage lifetime taxes and IRMAA [5] - Some provisions from the Tax Cuts and Jobs Act will sunset after 2025, and changes from the One Big Beautiful Bill Act may also impact deductions and tax brackets [5] Group 3: Required Minimum Distributions (RMDs) - Required minimum distributions begin at age 73, and it is crucial for those who turned 73 this year to take the correct amount to avoid penalties [7] - Coordinating withdrawals with a tax plan and utilizing IRA withholding can help manage taxes effectively [7] Group 4: Cash Management and Portfolio Rebalancing - Retirees should maintain one to two years of planned withdrawals in cash-like reserves to avoid forced selling during market downturns [9] - Rebalancing the investment portfolio to align with target risk levels is essential as investing risks change in retirement [9]

Core Insights - Retirement income taxation in Arizona varies based on income sources and residency, with specific exemptions for Social Security and military retirement pay [2][3] Arizona State Taxes - Arizona has a state income tax with a flat rate of 2.5%, but Social Security benefits and military retirement pay are exempt from this tax [6] - Private pensions, IRA and 401(k) withdrawals, and investment income are subject to state income tax, with retirees allowed to subtract up to $2,500 annually from certain pensions [6] - The state has a sales tax of 5.6%, with an average combined sales tax rate of 8.38%, which can be as high as 12% in some counties [6] - Property tax for homeowners is set at 0.45%, ranking as the fourth lowest in the U.S., and there is no state or inheritance tax in Arizona [6] Tax Breaks for Seniors - Seniors aged 65 and above can benefit from the Senior Property Valuation Protection Option, which can lower their overall tax bill by pausing the taxable value of their primary residence for up to three years [3][4] - To qualify for this option, retirees must have an income of no more than $45,264 (or $56,580 for multiple homeowners) averaged over the last three years [4] - Seniors in Maricopa County may also access the Elderly Assistance Fund, which reduces primary school district taxes [4] Property Tax Deferral - Arizona allows homeowners aged 70 and above to defer property tax payments for up to a year, provided their total annual taxable income is $10,000 or less [5]

Core Insights - The article discusses the financial decision-making process regarding the withdrawal of $200,000 from an inherited IRA Beneficiary Distribution Account (BDA) and the implications of tax rates on this decision [2][3]. Evaluation of Options - The article suggests that withdrawing the entire amount now may seem beneficial due to the potential for compound growth under long-term capital gains tax rates, but this does not apply if the individual remains in the same tax bracket [3]. - Keeping the money invested in the IRA could reduce tax drag and potentially yield a higher after-tax value at the end of 10 years [4]. Measuring Outcomes - A comparison of the after-tax value of the $200,000 is necessary to evaluate the two withdrawal approaches: withdrawing all now versus at the end of 10 years [5]. - If the individual withdraws $200,000 and pays 35% in taxes, only $130,000 would be available for reinvestment, while leaving the full amount in the inherited IRA allows for complete investment [7]. - The article proposes using a projected annual return of 10% for growth calculations over the next decade [7].