As the end of the year approaches, it’s time to consider ways to save money on your 2020 taxes. Year-end planning can seem like a daunting task, especially considering the recent events of this challenging year. To help minimize the financial burden brought on by the 2020 pandemic, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was passed by Congress and signed into law by President Donald Trump in March of this year. The CARES Act has provided important tax changes designed to deliver prompt relief to individuals struggling due to the COVID-19 pandemic. Specifically, charitable contributions limits increased for 2020, the 10% early withdrawal penalty from retirement accounts has been removed if the withdrawal is coronavirus-related, and required minimum distributions (RMDs) have been waived.
We want to ensure that you are taking the appropriate actions in order to fully maximize the benefits associated with the newly introduced CARES Act and the previously passed Tax Cuts and Jobs Act (TCJA). In this year-end planning article, we discuss several strategies that should be addressed prior to 2021.