From the Desk of Dale Crossley and Evan Shear – Year End Checklist

We hope this Q4 edition of the Journey finds you and your loved ones well. As 2024 draws close, we have some year-end financial planning tips to ensure you take advantage of tax-efficient strategies.

But before we cover those tips, we have some exciting news to share! It’s hard to believe our 25th Anniversary Gala took place one year ago. The evening was truly memorable – we loved spending time with our amazing clients. To elevate the experience even further, we’ll be setting sail on the CrossleyShear Wealth Management Inaugural Cruise from August 8-11, 2025, aboard Utopia of the Seas. We invite you to join us on this getaway at exclusive group rates. For more details, please visit here.

Now, let’s explore year-end strategies to ensure you’re ready for 2024 taxes. You can also access our at-a-glance guide Tax rates, schedules, and contribution limits for quick reference.

Charitable Giving

In a recent poll, 79% of students whose families give charitably feel that it is important to continue the tradition in their generation. That’s a testament to the generosity of our country and, of course, it has the added advantage of providing a potential tax deduction.
For cash donations to an IRS-qualified 501(c)(3) public charity, you can generally deduct up to 60% of your adjusted gross income. Appreciated assets, including long-term appreciated stocks and property held more than a year are generally deductible at fair market value, up to 30% of your adjusted gross income. Combining more than one type of asset can also be a tax-efficient move by allowing you to maximize the amount that you can take as a charitable tax deduction.

IRA QCD’s: Tax-Free Charity from IRA Distributions

Drawing from an IRA, distributions are typically taxed as income after enjoying years of tax-deferred contributions. However, charitable giving offers you a tax-free alternative to IRA distributions. These are known as Qualified Charitable Distributions or QCD’s. When you choose qualified charitable donation routes, you can give up to $105,000 per year from your IRA distributions without incurring the usual income tax. IRA distributions are tax-free as long as they are paid directly to a qualified charitable organization, from the trustee to the charity.
Just be sure to report your charitable donations correctly when filing your tax returns.

Maximize IRA Year-End Contributions

As we approach the end of the year, it's important to ensure you are taking full advantage of your IRA. If you are still working, be sure you have reached the contribution limit to help build the foundation of your post-retirement finances. You can also continue to make contributions under your 2024 IRA limits up until April 2025. For a complete guide on contribution limits, please see our reference guide, Tax rates, schedules, and contribution limits. We also have a Roth IRA calculator available so you can ensure you are opting for the best retirement investment.

For those past the distribution age, be sure to use your required minimum distributions. If you've made excess contributions, there’s still time to withdraw the excess before the due date of your tax returns. Smart investing means making the most of these opportunities.

Tax-Loss Harvesting

It has been a chaotic year for investments. Those who have experienced a few losses are not alone. Fortunately, every cloud has a silver lining. While it may be tempting to minimize the appearance of your losses, those losses could be tax-deductible. Accurately reporting loss on your investments for a tax benefit is known as tax-loss harvesting. This practice can allow you to harvest losses in order to offset capital gains, deduct against earned income, and possibly even carry over the tax benefits into the next year if you still have some losses left over. We can help you with this strategy.

Direct Indexing

When looking for an investment strategy, index funds offer a sense of stability based on current high-performing indexes. While index funds provide indirect investment, you can apply the same strategy through direct indexing by buying your own shares of the stocks included in each index to directly mirror the index's performance. Direct indexing gives you greater access to the advantages of investing in these profitable stock groupings and allows for customization based on your personal interests, priorities, and values.

Please do not hesitate to reach out to plan your 2024 end-of-year financial strategy further. That’s what we’re here for.

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There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct. All opinions are as of this date and are subject to change without notice. Past performance is not a guarantee of future results.