FAQs
For your convenience, We have compiled a list of questions often asked by new clients. If your questions are not answered here or you need further information, then please contact us via e-mail or via phone at 603.382.8867 and we’ll be happy to help you. We look forward to hearing from you soon.
OFFICE HOURS
January 15-April 15
Monday - Friday
8:30am-5pm
April 16-December 31
Monday - Thursday
8:30am-4:30pm
Friday
8:30am-12:30pm
Year-End Tax Tips
1. Can I benefit by postponing any of my income until January?
Yes, if you're due a sizable receivable or bonus at year end, try to postpone until January of the following year. For cash-basis business, wait until the last two/three weeks of the year to send your December invoices. Constructive receipt rule requires cash and checks received to be counted as sales in the year funds are available.
New for 2009: Tax rates may rise in 2009 this strategy is recommended only after a careful review of you financial situation.
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2. How does bunching itemized deductions and/or payments benefit me?
By bunching payments in the current year, you may qualify for itemizing deductions over the standard deduction. It may benefit you to use the standard deduction every other year, and then bunch your payments again the following year. This allows you to itemize every other year. Examples: Paying your state income tax estimate before December 31 and pay real-estate and property/vehicle taxes early, make an extra mortgage payment (the interest portion is deductible), or elective medicatl or dental work (completed) before the end of the year.
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3. How can reviewing income and deductions save taxes?
If your income is high, deferring receipt of more income at the end of the year can save taxes. If you're close to the line on itemizing deductions, accelerating payment of deductible expenses may save taxes.
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4. What is the deadline for opening an IRA to make a deductible contribution for the prior year?
If you qualify, you have until April 15 to open an IRA and make a deductible contribution for the prior year.
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5. How can I benefit by giving cash donations for a current deduction?
If you give appreciated property to charity, you'll get to deduct the full market value.
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6. Should I contribute to my company's 401(k)?
Yes, if you have a 401(k) plan at work, make as large a contribution as you're allowed to make.
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7. How can I offset capital gains?
Review your investment portfolio to determine whether you should sell some losers before year-end in order to offset capital gains you've already realized. Capital losses are first netted with captial gains and then are deductible against ordinary income (limited to $3,000 a year).
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8. How should I handle this year's annual gift tax exclusion?
If you make annual gifts to family members or others, make sure you complete your gifts for 2009 by December 31. ($12,000 per person per year-2008). ($13,000.-2009)
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9. I own a business, and I need to purchase new equipment. Should I purchase it now or wait until January?
It is strongly suggested that you set up an appointment with us to discuss your options. Pappalardo and Merrill can be reached for appointments at 603-893-8002.
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