Tax Planning

Planning is the key to successfully and legally reducing your tax liability. At Agog Financials we proactively recommend tax saving strategies to maximize your after-tax income. Businesses and individuals pay the lowest amount of taxes allowable by law because we are always looking for the ways to minimize your taxes throughout the year, not just at the end of the year. Through careful planning and legitimate tax strategies, we help you reduce tax liability.

Some of the strategies we use at Agog Financials include:

Defer Income Recognition:

Deferring income until retirement may result in paying taxes on that income at a lower rate. You can also defer income in the short term if you expect to in a lower bracket in the following year or by holding assets for a longer time to qualify for the lower capital gain rates.

Maxing out 401(k) Or employer plan contribution:

401(K) contributions are pre taxed as such by maxing out your 401(k) income you lower your taxable income. Also, most employers match your contribution so that is advantageous as well. You can withdraw the retirement funds at the time of retirement when you expect your income to be lower thus paying lower amount of taxes.

Contributions to IRA:

If you have income from wages or self employed, you can contribute money to a tax- sheltered investments such as traditional or Roth IRA’s. You can also contribute to spousal IRA if she makes little to no earned income.

Defer capital gains and accelerate capital losses:

Capital losses up to $3000 is deductible per year. The remaining losses can be deferred to following years. If you planning on selling an investment with capital gains, you may be able to offset your capital gains with accumulated capital losses. Also, holding an asset for more than a year will let you chose favorable long term tax rates.

Business Automobile Deduction:

Small business owners can deduct 56.5 cents per business mile driven. You can deduct the standard mileage rate or the actual expenses incurred. Car leases can also be used to business owners advantage as they can deduct the lease payments as a business expense.

Home office expense:

Most business owners do some work from their home and thus can deduct any expenses related to business use of the home. Business users can deduct electricity, phone, internet expenses that was incurred to conduct business.

Section 179 expense:

Most small business owners can deduct the cost of qualifying equipment and or/software purchased or financed during the tax year. That means that if you buy a piece if qualifying equipment, you can deduct the full purchase price from your gross income. In 2018, Section 179 allows you to immediately deduct, rather than depreciate over time, up to $1,000,000 (up from $ 500,000 in 2017) worth of qualified business property that you purchase during the year.

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