Tax Planning in Laredo, TX

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Tax PlanningReduce Your Tax Liability With Correct Capital's Financial Advisors in St. Louis

Tax Planning in Laredo, TX. Tax liability refers to the amount you owe in taxes to local, state, and federal authorities. While it’s inevitable that a part of your earnings or profits goes to taxes, there are numerous legal strategies to lessen your tax burden. Tax planning is also a key factor in successful retirement planning. At Correct Capital, although we do not provide tax advice, we work alongside local Laredo, TX residents, families, and business owners to explore effective and tried-and-true ways to reduce their tax obligations. For instance, we might advise an individual to maximize deductible contributions to their retirement plan, which can help lessen tax costs. Reach out to Correct Capital's tax planners and fiduciary advisors today at 877-930-4015, connect with us online, or keep reading to learn how proactive tax planning can benefit you.



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Tax Planning for Laredo, TX Individuals and Families

Effective tax strategies can help individuals and families increase their retirement savings and offer them more money for both today and in the near future. A few things to consider when tax planning in Laredo, TX:

  • Standard Deduction vs. Itemizing —

    The standard deduction is a preset amount that allows a straightforward deduction from your taxable income. In 2024, the standard deductions are:

    • $14,600 for single filers
    • $29,200 for married, filing jointly
    • $14,660 for married, filing separately
    • $21,900 for head of household

    When your deductible income is more than the standard deduction, itemizing each eligible deduction may be advantageous. The trade-off is that itemizing takes more time, as you need to provide evidence for each deduction. A financial planner in Laredo, TX can work with you to decide whether claiming the standard or itemized deduction is more beneficial.

  • Review Your Retirement Accounts —

    Roth IRAs and Traditional IRAs both present unique tax benefits. Contributions to a traditional IRA may be fully or partially deductible, and taxes are only applied upon withdrawal. Unlike traditional IRAs, Roth IRA contributions are non-deductible, but your funds grow without future taxes. Which account benefits you most will depend on your specific tax planning needs. If you expect future tax rates to increase, a Roth conversion, or moving funds from a traditional IRA to a Roth IRA, might be wise to lock in tax-free growth while paying taxes upfront.

    If you have a 401(k) plan with your employer, you can set aside income from your paycheck, placing it straight into your 401(k). For 2024, you can contribute up to $23,000 to a 401(k), plus an extra $7,500 if you are over age 50.

    Freelancers or self-employed individuals can open up personal retirement plans tailored to their needs. Options include a Simplified Employee Pension (SEP) IRA or a One-Participant 401(k) Plan, which allow you to deduct your contributions.

  • Tax-Loss Harvesting

    By selling securities at a loss, you can offset capital gains taxes owed on gains from other investments. Tax-loss harvesting is especially useful for short-term gains, where tax rates are higher than for long-term gains. You can deduct up to $3,000 in capital losses each year, with any remaining losses rolled over into future tax years.

  • Consider Paying Next Year's Bills Now —

    Medical expenses not reimbursed by insurance can be deducted if they exceed 7.5% of your AGI. Other potential deductions include prepaying property taxes if permitted, covering future tuition costs, or investing in career-advancing courses to qualify for a Lifetime Learning Credit.

  • If Married, Filing Jointly or Separately —

    Around 95% of married couples file taxes jointly, a method that enables eligibility for specific tax credits and reductions. However, if one spouse is a higher earner, filing separately might place them in a lower tax bracket. In situations where one spouse has substantial medical expenses, separate filing can help reach the medical deduction threshold.

  • Make Charitable Donations —

    You can deduct up to 60% of your adjusted gross income by making donations to certain organizations. Per IRS Publication 526, eligible organizations may include the following:

    • Non-profits that are religious, scientific, educational, or focused on preventing cruelty to animals or children
    • Veterans' organizations
    • Fraternal organizations under a "lodge system" provided funds are used for charity
    • Organizations managing cemeteries
    • Federal, state, local, or Native government entities, provided funds are for public purposes
    • In some cases, Canadian, Mexican, or Israeli organizations if they qualify as U.S.-equivalent charities

    *According to IRS Publication 526 (2023), Charitable Contributions

    By opening a Donor-Advised Fund, you can make a large contribution now for an immediate tax deduction and recommend how the funds are allocated in the future.

    Once you reach age 70½, you’re eligible to make a qualified charitable distribution by transferring up to $105,000 annually from your IRA directly to a charity without tax consequences. If you are 73 or older, that donation also counts toward your required minimum distribution, which may reduce both your future required distributions and tax burden.

By working with an experienced financial adviser for tax planning in Laredo, TX, you can reduce your tax liability this year and create a plan for managing taxes through retirement. Correct Capital is here to help you keep more of your money today and establish a financially secure future.

Common Tax Planning Mistakes for Laredo, TX Individuals and Families

Effective tax planning is crucial for your family’s financial health. However, mistakes in tax planning can lead to paying more in taxes than necessary or missing out on potential savings. Below are some common tax planning errors and how Correct Capital can help you avoid them:

  • Not Maximizing Retirement Contributions —

    By not maximizing contributions to retirement accounts like Traditional IRAs, Roth IRAs, or 401(k)s, you risk losing out on tax deductions and long-term growth opportunities.

    How Correct Capital Helps: We evaluate your financial situation to ensure you’re contributing as much as feasible, which can reduce taxable income while building a strong retirement foundation.

  • Overlooking Available Tax Credits and Deductions —

    Many people miss out on important tax credits and deductions, such as the Earned Income Tax Credit, Child Tax Credit, or deductions for education and medical expenses.

    How Correct Capital Helps: Our advisors may review your tax return to see if you’ve claimed all available credits and deductions, aiming to maximize your refund (if eligible) or minimize any amount owed.

  • Poor Record-Keeping —

    Disorganized financial records can lead to missed deductions and complications when filing taxes. Without accurate documentation, you might struggle to substantiate claims if audited.

    How Correct Capital Helps: Our team helps you establish organized record-keeping systems and locate required documents, making sure everything is available for tax filing or in case of an audit.

  • Ignoring Tax-Efficient Investment Strategies —

    Neglecting tax-efficient investment strategies, such as asset location or tax-loss harvesting, can erode overall returns.

    How Correct Capital Helps: Our team provides insight on tax-efficient investment choices, assisting you in minimizing taxes on dividends, interest, and capital gains through strategic asset selection.

  • Failing to Plan for Life Changes —

    Significant life changes, such as marriage, divorce, becoming a parent, or purchasing a home, can greatly affect your tax obligations. Ignoring these life events may cause surprise tax liabilities.

    How Correct Capital Helps: We collaborate with you to update your tax planning strategies in response to life changes, ensuring you benefit from new deductions or credits and stay compliant with tax regulations.

  • Underestimating Estimated Tax Payments —

    For income not subject to withholding—like freelance or investment earnings—you may be required to make estimated tax payments. Without making these payments, you could face fines and interest charges.

    How Correct Capital Helps: We work with you to build cash reserves to cover estimated tax payments, helping you avoid penalties and interest fees.

  • Not Utilizing Health Savings Accounts (HSAs) and Flexible Spending Accounts (FSAs)

    HSAs and FSAs allow for tax-efficient healthcare spending, but they’re often underutilized by eligible individuals.

    How Correct Capital Helps: We offer guidance on the benefits of HSAs and FSAs, assessing whether they suit your circumstances and helping you allocate pre-tax dollars for healthcare expenses to lower taxable income.

  • Overlooking Education Savings Plans —

    Failing to consider 529 college savings plans may mean missing valuable tax benefits for education savings.

    How Correct Capital Helps: We guide you in setting up education savings accounts that provide tax-deferred growth and may offer state tax deductions.

  • Not Reviewing Withholding Allowances

    Incorrect tax withholding—either too much or too little—may result in a big refund or an unexpected tax bill.

    How Correct Capital Helps: We work with you to adjust your withholding allowances for improved cash flow and reduced surprises during tax season.

  • Missing Opportunities for Charitable Contributions —

    Not properly documenting charitable donations can lead to missed tax deductions.

    How Correct Capital Helps: We assist with planning your charitable giving to maximize tax benefits, including helping with Qualified Charitable Distributions (QCDs) if you qualify.

Tax Planning for Laredo, TX Business Owners

Business owners in Laredo, TX can use strategic tax planning to keep more revenue within their business. Consider these points when tax planning for your Laredo, TX business:

  • Review the Structure of Your Business —

    How your business is structured is key for tax planning and requires thoughtful consideration. Forming your business as an LLC, sole proprietorship, partnership, or S or C corporation will influence both the corporate and personal tax rates.

  • Review the Retirement Plans You Offer Employees —

    Providing retirement plans such as 401(k)s, 403(b)s, or other defined contribution plans is an effective way to reduce tax liability. With changes under the "SECURE" Act of 2019, speaking to a financial advisor in Laredo, TX about retirement plan tax benefits is recommended.

    If you’re a high-earning business owner with high-income employees, a Cash Balance Pension Plan could be advantageous, though it requires large contributions.

  • Have Your Family Work For The Business —

    Bringing family into the business offers tax perks, such as allowing children to work tax-free up to $14,600, and they can even start contributing to a ROTH IRA. Having your spouse on the payroll can let you double the amount you contribute to retirement.

  • Use a Company Vehicle —

    Based on your Laredo, TX business type, you and your employees may qualify to use a company vehicle with deductible transportation costs. There are two options for claiming this deduction:

    • Take the standard mileage deduction of 67 cents per mile for gas and electric vehicles; or
    • Maintain records of actual costs like maintenance, registration, and fuel to calculate whether this deduction is greater than the standard mileage rate.
  • Consider Fringe Benefits For Your Employees —

    Raising employee salaries may lead to increased employment tax costs. See if employees are open to receiving fringe benefits as part of their pay package rather than a higher paycheck. Possible fringe benefits that may reduce tax liabilities are health insurance, group life insurance, childcare assistance, transport reimbursements, meals, family or medical leave, and continuing education reimbursement.

    You can implement accountable plans to cover certain employee expenses, such as travel, meals, or entertainment, without reporting them as income.

  • Look into Carryover Deductions —

    When some deductions are unavailable this year, they may be eligible for carryover into future years. Examples of carryover deductions include home office expenses, net operating losses, business credits, and capital losses.

Tax laws for businesses are constantly evolving. Working with a Laredo, TX tax planner offers the benefit of joint efforts with your tax professional to explore methods for boosting your financial future.

Common Tax Planning Mistakes for Laredo, TX Businesses

Effective tax planning allows businesses of all sizes to reduce tax liabilities and increase profitability. Yet, numerous businesses make frequent tax errors that result in increased tax bills, overlooked deductions, and potential penalties. Here’s a look at frequent tax pitfalls and how Correct Capital can help businesses steer clear of them.

  • Not Paying Estimated Quarterly Taxes —

    Failing to pay or underpaying quarterly estimated taxes can result in IRS penalties and interest charges. This issue frequently affects small businesses, freelancers, and companies with irregular income.

    How Correct Capital Helps: Our team assists in calculating and timing estimated tax payments to keep businesses compliant with IRS rules and avoid penalties.

  • Neglecting Retirement Plan Contributions for Owners and Employees —

    Many companies miss the opportunity to use retirement contributions to lower their taxable income. 401(k)s, SEP IRAs, and Solo 401(k)s offer significant tax advantages for business owners and employees.

    How Correct Capital Helps: Our team helps set up and optimize retirement plans that lower taxes and serve as a tool for recruiting and retaining employees.

  • Not Planning for Profitability and Cash Flow —

    Many companies prioritize short-term tax savings over long-term profitability and growth. This approach can prevent businesses from taking advantage of strategic investment or growth opportunities.

    How Correct Capital Helps: We deliver thorough tax planning to support future growth, optimize reinvestment, and ensure efficient cash flow management.

  • Neglecting Exit and Estate Planning —

    Business owners often fail to create a succession plan to address the financial aspects of selling their business. Owners frequently concentrate on operations and may neglect how to allocate proceeds from a sale in a tax-effective manner. Additionally, without estate planning, owners may miss opportunities to ensure beneficiaries and loved ones are taken care of.

    How Correct Capital Helps: Our team supports business owners in exit planning, helping them decide how to manage the proceeds from a sale. We focus on defining the purpose of these funds and addressing them from an estate planning perspective, ensuring beneficiaries are considered and taxes are minimized through careful planning.

Tax Planning| Retirement Planners | Financial Advisor Near Me

Tax Planning in Laredo, TX | Correct Capital Wealth Management

At Correct Capital, our Laredo, TX financial advisors and tax planners understand how essential the financial health of your family or business is, both now and in the future. For this reason, we follow the fiduciary standard and our I.O.U. promise, meaning that every recommendation we provide is independent, objective, and unbiased. With tax laws constantly evolving, it’s essential to have a strong team in place, including your Laredo, TX financial advisor, tax professional, and attorney. If you need help with tax planning, retirement strategies, or other financial services in Laredo, TX, call Correct Capital today at 877-930-4015 or get in touch online.


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