Could You Save Money Before Filing Taxes?

Kyle

Hello, I’m Kyle Grandstaff, a portfolio manager here at Healy Wealth Management. With tax filing day quickly approaching on April 15th, I wanted to share some actionable tax saving strategies you can implement before then to help possibly lower your 2024 taxable income. I will cover three different possibilities that could help lower your taxes for 2024.

These topics are: Contributing to a traditional or SEPP IRA, making contributions to a health savings account or HSA, And the last one is contributing to a 529 education savings plan. First, I will discuss the traditional IRA and the SEPP IRA contributions. Now for each of these, there’s still a way to make 2024 contributions, even though we are in 2025. With the traditional IRA, you can make prior contributions until April 15th. The contribution limits for 2024 are $7000 if you’re under the age of 50, and $8000 if you are 50 and above.

These contributions can be deductible, which can help to lower your taxable income. However, there are income limits that could prevent you from getting a tax deduction. And I’d recommend working with your CPA or tax professional to determine your correct deduction amounts. Now for the SEPP IRA, the same contribution deadline exists. April 15th. But you can file for an extension.

And in that case you can make the contributions up until the extension date, which is October 15th of this year. As mentioned before, I’d recommend working with your CPA or tax professional to determine the appropriate SEPP IRA contribution, as the limits can vary based on your total compensation.

So think salary bonuses, different stock like compensation strategies and the contributions for these SEPP IRAs, all participants generally must get a uniform contribution. Next, you can still make prior year contributions into a health savings account if you have one. This is another great strategy to help potentially lower your taxable income for 2024. These HSAs offer triple tax advantage. Your contributions are tax deductible. The account grows tax free, and the withdrawals for qualified medical expenses can come out tax free.

Make sure to contribute up to the annual limit if you can, which in 2024 was $4,150. If you had self-only coverage, or $8,300 for family coverage. The last strategy to consider is contributing to a 529 education savings plan. Many states offer a state income tax deduction or credit for these contributions that you might make to these plans. Not only do you benefit from the tax free growth of your education funds, but you might also reduce your state taxable income. Check with your state’s rules because the amount and type of tax benefit can vary. This strategy can be particularly advantageous if you’re saving for future education expenses.

So to wrap up, we’re getting close to tax day, it’s still possible to take these steps to help lower your 2024 taxable income and therefore potentially lower your taxes. If you have any questions or any personalized advice, please don’t hesitate to contact me or anyone on our team. Also, consider consulting with your tax professional. Don’t forget to like this video and subscribe for more videos. Thank you for watching, and here’s to a more efficient tax season. Thank you.