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Year-End Tax Planning Tips

Dec. 12, 2017 7:38 AM ET
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Manning & Napier

The uncertainty surrounding potential tax law changes has dominated headlines in the past few weeks. While the tax landscape for 2018 is still up in the air, we know what the laws are for 2017 (assuming none of the potential changes are made retroactively, which appears unlikely based on recent proposals). When it comes to tax planning, most strategies must be completed on a calendar year basis. As we quickly approach the holiday season and the end of 2017, it is important to take time to think about tax savings strategies that can benefit you and your family.

Retirement Accounts

  • Maximize retirement plan contributions by year-end.
    Not only does this help you to better prepare for retirement, it also may reduce this year's tax bill and set you up for tax-deferred growth over your investment time horizon. If you are not on pace to maximize your contributions by year-end, consider increasing your deferral rate to direct extra dollars to your retirement account during the last few remaining pay periods of 2017.
  • Maximize Traditional IRA / Roth IRA contributions by 4/1/18.
    Roth IRAs grow tax-free and are not subject to mandatory distribution rules (Required Minimum Distributions), making them great both for retirement planning and as multi-generational planning tools. Contributions to Traditional IRAs can be tax-deductible in the year that you make them (depending on your income), so maximizing IRA contributions, in addition to 401(k)/retirement plan contributions, can be another great way to reduce your taxes for the year.
  • Explore additional ways to contribute to tax-advantaged accounts.
    These can include cash balance plans, spousal IRAs, non-deductible IRA contributions, and "back-door" Roth IRA contributions.
  • Take Required Minimum Distributions by year-end to avoid a 50% IRS penalty.
    Required Minimum Distribution tax rules apply to Traditional, Rollover, and Inherited IRAs.

Giving Strategies

  • Consider an IRA Qualified Charitable Distribution (QCD) to

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Manning & Napier (NYSE: MN) provides a broad range of investment solutions through separately managed accounts, mutual funds, and collective investment trust funds, as well as a variety of consultative services that complement our investment process. Founded in 1970, we offer equity and fixed income portfolios as well as a range of blended asset portfolios, such as life cycle funds, that use a mix of stocks and bonds. We serve a diversified client base of high-net-worth individuals and institutions, including 401(k) plans, pension plans, Taft-Hartley plans, endowments and foundations. For many of these clients, our relationship goes beyond investment management and includes customized solutions that address key issues and solve client-specific problems.

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