Year End Checklist and 2019 Planning

By Egan on December 18, 2018

2018 Year End Checklist

You made it through Thanksgiving and now it’s the time of year when you’re cramming in all the end of the year festivities and holidays, time spent with family, and with any luck a few days off from work.

For The Egan Group, it also means a year-end check list of things to go over with and for our clients. So, what’s on the list this year?  A few standards and a few new ones as well, so here goes:

Charity: Aside from making last minute checks or gifts to your favorite charity, something to think about for this year is setting up a Donor Advised Fund (“DAF”). DAF’s can have many advantages especially considering the new tax laws. Some of our cherished tax deductions have gone away and some people might be better off taking a standard deduction, which may lessen the year-to-year impact of your charitable donation. What happens if you make a larger gift into DAF this year and then over the next few years parse those funds out to your favorite charities? Consider this simple scenario – assume you make gifts every year of $5,000, but this year with the new tax you lose the ability to deduct.  What if instead you gift $10,000 in cash or appreciated securities to a DAF and then give 1/2 this year and half next year to your favorite charity. You may be able to again deduct the full $10,000 gift this year thus front-loading your tax advantage. Please note that donating appreciated securities gives you the added benefit of avoiding capital gains taxes.  Feel free to call us for more details.

Gifts to Family: This year under the new tax law the amount you can give tax free to any one individual is now $15,000.

Beneficiary Designation: Check and update your beneficiary designation on your IRA and other retirement accounts and don’t forget to look at old insurance policies as well.

Corporate Benefits: If you have not already done so review and enroll for your corporate benefits.

Max Out Your 401k: In 2018 the maximum contribution is $18,500, along with a catch up of $6,000 for those of us over 50. Next year the amount moves up to $19,000.

Estimated Tax Payment: Make sure you get a handle on all your income from 2018 and make a final estimated payment by January 15, 2019 … this will help avoid interest on a penalty if you underpay. There are many tax changes in the new tax law, don’t get caught on April 14^th wondering what you should have done … there is time right now to act.

Identity Theft: Barely a day goes by when we don’t read an article about some company having their client data breached. Have you signed up for credit monitoring? Basic monitoring is free and some enhanced monitoring does not cost more than a few cups of Starbucks a month which makes it well worth it, in my opinion. Go to Experian or Equifax to see what they offer. Take an hour to protect your credit … you’ll be glad you did.

And finally: get ready to review your 2018 new year’s resolutions, hopefully you can check off more than a few and start thinking about what should make your list for 2019.

2019 Planning Checklist

Here are a few things to think about when planning for 2019:

• Make a prior year (2018) IRA contribution (up to April 15^th)
• Make a prior year (2018) HSA contribution
• Review contribution increased limits
• Review beneficiary forms (IRA and qualified plan) of both account owners and inherited IRAs
• Review 2019 RMD obligations (clients 70 1/2 or older)
• Make an early 2019 IRA contribution
• The Egan Group will be in touch on our 2019 investment outlook and asset allocation, if we feel a change is needed to any portfolio
• Start to gather 2018 tax documents. The Egan Group will ensure you have all the documents needed and will be in touch on scheduling a 2018 tax meeting

Please feel free to reach out to us to ask us questions on 2019 planning or to review any anticipated life events in the 2019 year (i.e. retirement, sale of business, relocation, job raise, inheritance, expecting baby, etc.)

We wish you all a happy, healthy, and above all else, a peaceful holiday season and new year!