"Preserving your wealth and planning for your future"

Tax Planning & Guidance

    We recognize that planning is the cornerstone of success, and is pivotal in minimizing your tax consequences. To accomplish effective tax planning, we are constantly monitoring tax legislation, regulation, and court rulings. We strive to educate our clients on the legal and regulatory changes, and advise based on maximum benefits.         

For individuals, Inuit’s Quicken is a cost effective and easy tool to track expenses. Pinnacle can guide you through the setup and implementation of this powerful tool. 

Please contact us to setup a free consultation.    

Take note of the key points below to execute maximum tax planning savings for your family.

A.   Investment tax planning

  • Place heavily taxed investments like high yield bonds, master limited partnerships, and high yield stocks in tax deferred retirement accounts such as 401k, IRA, SEP accounts.    
  • In taxable accounts, consider tax-free municipal bonds, high growth non-dividend paying equities, and qualified dividend paying stocks. Qualified dividends are taxed at a maximum rate of 15%. 
  • “Tax loss harvesting”- sell all unrealized (losing) investment positions up to $3,000 by day's end December 31. (Note: If you sell stock to generate a loss, you're prohibited from purchasing the same stock for 30 days after the sale that generated the loss.) If the securities you sell are mutual-fund shares, you are able to reinvest the proceeds in a similar – but not identical – fund, to maintain your investment strategy, and deduct the loss. Do not let possible tax savings cause you to make a decision contrary to your investment interests.  
  • Never under any circumstances take distributions before age 59.5 from retirement accounts (401k, IRA, SEP, Roth IRA).
  • Consider saving for your children’s college tuition by contributing to a Qualified Tuition Program. These plans allow earnings to be excluded from taxable income.
  • If you paid alternative minimum tax (AMT) in prior year and expect to earn the same level of income in current year, max out annual employer retirement account contribution amount -$16,500 for 401(k)
  • Consider real estate investment  
    • Residential rental real estate- You can depreciate purchase price and all closing costs of property over 27.5 years. All insurance, mortgage interest, repairs, cleaning, maintenance, management fees, taxes, and utilities are deductible. The goal is to find properties producing positive cash flow, where rental income will cover all expenses above excluding depreciation.
    • Commercial Real Estate- You can depreciate purchase price over 39 years. All expenses related to maintaining and operating the property is deductible, just like residential rental property.

Self-employment strategies — if you're self-employed, you can decrease your taxable income by:

  • Delaying your December billings until January
  • Setting up and contributing to a qualified self-employed retirement plan (SEP)
  • Buying supplies and equipment this year instead of next year
  • If you use a part of your home exclusively and regularly for business, you can deduct the business portion of rent, mortgage interest, real estate taxes, utilities, insurance and repairs.

B.   Adjustments to gross income    

  • If you are under the age of 50, the maximum IRA or Roth IRA contribution is $5,000. Roth IRA contributions are not tax deductible. All investment income and gains from 401(k) and IRA are not taxed until a distribution. All investment income and gains from Roth IRA’s are never taxed as there is no tax due on distributions before age 59.5. 
  • Moving expenses can be deducted if you meet the qualifications.

C.   Itemized deductions

  • All medical and dental expenses more than 7.5% of your adjusted gross income are deductible, these include all of the following:
    • Prescriptions
    • Health insurance premiums
    • Long-term care premiums
    • Doctor, specialist, hospital, co-pays,  x-rays, and lab fees
    • Hearing aids, eyeglasses, and contact lenses
    • Medical equipment and supplies
    • In vitro fertilization and child birth expenses
    • Medical transportation expenses including tolls, parking
    • Mileage for trips to health facilities, Doctor's offices, labs, etc. 
    • Nursing home expenses
    • Medical aids such as crutches, canes, and orthopedic shoes
    • Equipment for disabled or handicapped individuals 
    • Cost of alcohol or drug abuse programs, in addition to smoking-cessation treatments 
    • Wages for nursing services
  • State & Local Taxes
  • All real estate taxes paid are deductible
  • All personal property taxes (Ad valorem) paid are deductible. Commonly on vehicles, boats, trailers, jet ski, etc.
  • All mortgage interest paid is deductible. Your lender will send you a form 1098 for these amounts paid annually.
  • Donations to charity
  • All receipts for cash donations over $20 should be saved
  • Save all receipts for non-cash (goods) donated to charities (IE. Goodwill, Salvation Army, etc)
  • Please keep track of all mileage for charitable service, as this mileage can be deducted
  • Casualty and theft loss amounts not reimbursed by insurance are deductible
  • Un-reimbursed job expenses are deductible subject to limitations

D. Tax Credits

  • Earned Income Credit (EIC)- You can claim this tax credit even if you have no tax liability. You may qualify for the EIC if your earned income and adjusted gross income are below mandated amounts
  • Child Tax Credit- You can claim $1,000 for each child. Child Tax Credit begins to phase out when your AGI is more than mandated limits
  • Education Tax Credits

Please contact us to setup a free consultation.   

400 Galleria Parkway STE 1500
Atlanta, GA 30339
Phone:(404) 585-5946