Tax Planning in Springfield, MO

Complimentary Planning By Elements

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

Tax Planning in Springfield, MO. Tax liability refers to the amount you owe in taxes to local, state, and federal authorities. Although paying taxes is unavoidable, various lawful strategies can minimize how much you owe. Tax planning is also vital to successful retirement planning. At Correct Capital, although we do not provide tax advice, we collaborate with local Springfield, MO people, families, and companies to discover creative and proven ways to decrease their tax liability. 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, contact us online, or read on to see how effective tax planning can make a difference.



Schedule a Meeting With an Advisor Today

Correct Capital Wealth Management's office is physically located in St. Louis, MO, but we serve clients throughout the United States in both personal financial planning and corporate retirement plans.

Schedule a 15-Minute Introductory Call


More From Correct Capital Wealth Management

Explore how Correct Capital Wealth Management can help guide you toward smarter decisions, clearer goals, and lasting financial success.

Subscribe To Our Newsletter Listen To Our Podcast Watch Our YouTube Channel


Tax Planning for Springfield, MO Individuals and Families

Proactive tax planning can help individuals and families increase their retirement savings and offer them more money for both now and years to come. A few things to consider when tax planning in Springfield, MO:

  • Standard Deduction vs. Itemizing —

    The standard deduction is a preset amount that reduces your taxable income without needing specific proof of deductions. 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

    If your deductible expenses are higher than these thresholds, itemizing—adding each eligible deduction individually—may be beneficial. The trade-off is that itemizing takes more time, as you need to provide evidence for each deduction. A financial planner in Springfield, MO can assist in determining whether claiming the standard or itemized deduction is more suitable.

  • Review Your Retirement Accounts —

    Roth IRAs and Traditional IRAs both provide tax advantages, though in different ways. 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. The best option depends on your individual financial picture and tax outlook. One potential strategy is a Roth conversion, which moves funds from a traditional to a Roth IRA, letting you pay taxes now and enjoy tax-free growth later.

    If you have a 401(k) plan with your employer, you can defer income from your paycheck directly to your 401(k). In 2024, the maximum contribution limit for a 401(k) is $23,000, with an additional $7,500 allowed if you’re 50 or older.

    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, enabling you to deduct your contributions.

  • Tax-Loss Harvesting

    If you sell securities at a loss, you can offset the amount of capital gains tax owed on profits from other securities. 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 —

    For unreimbursed medical expenses, you can deduct costs that surpass 7.5% of your adjusted gross income. 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 —

    Roughly 95% of married individuals file jointly, as this is required for some tax benefits and credits. However, if one spouse is a higher earner, filing separately might place them in a lower tax bracket. Separate filing may also make sense if one partner has considerable medical costs, making it easier to meet the 7.5% medical deduction limit.

  • Make Charitable Donations —

    Donating to eligible organizations allows you to deduct as much as 60% of your adjusted gross income. According to IRS Publication 526, qualifying organizations include:

    • Non-profit organizations focused on religion, science, education, or preventing cruelty to animals and children
    • Non-profits supporting veterans
    • Fraternal organizations under a "lodge system" provided funds are used for charity
    • Non-profits or companies associated with cemeteries
    • Any U.S. federal, state, local, or Native governments and subdivisions, as long as funds are for public use
    • Canadian, Mexican, or Israeli organizations, provided they meet U.S. charity qualifications

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

    Opening a Donor-Advised Fund allows for an upfront tax deduction with the flexibility to recommend how funds are distributed over time.

    At age 70½ or older, you can make a qualified charitable distribution by transferring up to $105,000 each year tax-free from a traditional IRA directly to a charity. Once you’re 73 or above, the donation can also be applied as your required minimum distribution, potentially lowering both future distribution requirements and tax obligations.

Using a skilled financial adviser for tax planning in Springfield, MO not only helps lower your tax bill this year but also lays out a strategy for retirement taxes. At Correct Capital, our goal is to help you save now and position yourself for financial stability in the future.

Common Tax Planning Mistakes for Springfield, MO Individuals and Families

Good tax planning plays an essential role in ensuring your family’s financial well-being. However, mistakes in tax planning can lead to paying more in taxes than necessary or missing out on potential savings. Here’s a look at some typical tax planning missteps and how Correct Capital helps you avoid them:

  • Not Maximizing Retirement Contributions —

    When you don’t contribute the maximum allowable to tax-advantaged retirement accounts like Traditional IRAs, Roth IRAs, or 401(k)s, you may miss out on valuable tax deductions and long-term growth.

    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: We carefully examine your tax return to verify if you’ve taken advantage of all possible credits and deductions, helping to maximize refunds or reduce liabilities.

  • Poor Record-Keeping —

    A lack of organized financial records may result in missed deductions and complications at tax filing time, and without the right documents, you may have trouble supporting claims if audited.

    How Correct Capital Helps: We assist you in setting up effective record-keeping systems and locating necessary documentation, ensuring all receipts and documents are properly organized and accessible when needed.

  • Ignoring Tax-Efficient Investment Strategies —

    Overlooking the tax impact of investment decisions can diminish your returns. This may include neglecting asset location strategies or failing to harvest tax losses.

    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. Overlooking these changes could result in unforeseen tax bills.

    How Correct Capital Helps: We help you adjust your tax strategy based on life changes, allowing you to take advantage of new tax breaks while remaining compliant with tax laws.

  • Underestimating Estimated Tax Payments —

    If you earn income not subject to withholding, such as freelance or investment income, estimated tax payments may be necessary. Neglecting estimated tax payments may result in penalties.

    How Correct Capital Helps: We help you prepare your cash flow to cover estimated tax payments, avoiding fines and added interest.

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

    HSAs and FSAs provide tax advantages for covering medical costs, but many eligible individuals miss out by not contributing.

    How Correct Capital Helps: Our advisors explain the advantages of HSAs and FSAs and determine if they’re right for you, helping you set aside pre-tax funds for medical costs to reduce taxes.

  • 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 —

    Failing to document or strategize charitable donations can mean lost deductions.

    How Correct Capital Helps: Our advisors help you strategize charitable contributions to maximize deductions, including guidance on Qualified Charitable Distributions if eligible.

Tax Planning for Springfield, MO Business Owners

Business owners in Springfield, MO can benefit from effective tax planning to retain more money within their business. Consider these points when tax planning for your Springfield, MO business:

  • Review the Structure of Your Business —

    The structure of your business impacts tax planning and should be carefully considered. Structuring your business as an LLC, sole proprietorship, partnership, or S or C corporation will affect both corporate and individual tax rates.

  • Review the Retirement Plans You Offer Employees —

    Setting up retirement plans like 401(k)s, 403(b)s, and similar options can help reduce tax obligations. With changes under the "SECURE" Act of 2019, speaking to a financial advisor in Springfield, MO about retirement plan tax benefits is recommended.

    For business owners and employees with higher incomes, a Cash Balance Pension Plan can offer significant tax savings, even if it requires a sizable investment.

  • 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. Employing your spouse can allow for increased retirement contributions, potentially doubling your retirement savings.

  • Use a Company Vehicle —

    Based on your Springfield, MO 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:

    • Deduct 67 cents per mile using the standard mileage rate, which applies to gas and electric vehicles alike; 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 —

    Increasing wages for employees can drive up employment tax expenses. Explore the possibility of offering fringe benefits instead of wage raises. 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 —

    If certain deductions aren’t usable this year, you may be able to apply them in a different tax year. These may include deductions such as home office expenses, net operating losses, business credits, and capital losses.

Tax laws for businesses are constantly evolving. Partnering with a professional tax planner in Springfield, MO means they work with you and your tax expert to identify strategies for enhancing long-term financial outcomes.

Common Tax Planning Mistakes for Springfield, MO 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. Listed below are typical tax planning mistakes businesses make and how Correct Capital assists in avoiding them.

  • Not Paying Estimated Quarterly Taxes —

    Businesses may overlook or underpay quarterly estimated taxes, which can lead to penalties and interest from the IRS. This is especially common among small businesses, freelancers, or companies with variable 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 businesses don’t fully utilize retirement plan contributions as a way to lower 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: We assist businesses in establishing retirement plans that cut taxes and appeal to prospective and current employees.

  • Not Planning for Profitability and Cash Flow —

    Focusing solely on cutting current taxes often leads businesses to miss out on planning for sustained growth and profitability. Such a narrow focus may cause missed opportunities for reinvestment or tax-efficient growth.

    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 —

    A succession plan addressing the financial aspects of selling a business is often overlooked by owners. While they may focus heavily on operations, they might miss planning for how to manage and allocate the sale proceeds in a tax-efficient way. Without proper estate planning, owners might not fully address their loved ones’ and beneficiaries’ financial security.

    How Correct Capital Helps: We assist business owners with exit planning, guiding them in making informed decisions on how to allocate sale proceeds. We aim to identify the purpose of sale proceeds and apply estate planning principles, so beneficiaries are accounted for and taxes are efficiently managed.

Tax Planning| Retirement Planners | Financial Advisor Near Me

Tax Planning in Springfield, MO | Correct Capital Wealth Management

At Correct Capital, our Springfield, MO financial advisors and tax planners understand how essential the financial health of your family or business is, both now and in the future. To uphold your trust, we commit to the fiduciary standard and our I.O.U. promise—all advice is independent, objective, and unbiased. With tax laws constantly evolving, it’s essential to have a strong team in place, including your Springfield, MO financial advisor, tax professional, and attorney. If you need help with tax planning, retirement strategies, or other financial services in Springfield, MO, call Correct Capital today at 877-930-4015 or get in touch online.


Are you ready to experience the Correct Capital difference?

GET STARTED

Meet our team of financial advisors.

Our Team

Services We Offer