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Tax questions to help U!

Tax questions to help U!

January 25, 2021

Whether you are filing as an individual, a household, or a business, here are a few questions you need to keep in mind this tax season. (Yes- it’s that time of year again!)

Questions to consider filing your taxes:

1. When is the IRA/ROTH Contribution Deadline?

April 15th

2. Am I Being Double Taxed on my IRA Contributions?

If you contribute to a “Traditional IRA” make sure you confirm with your accountant that the amount was fully deductible. If it was not, you might end up paying taxes on that money TWICE! Now and when you retire. Make sure you are able to deduct these funds. If not, you may want to discuss with your accountant and advising team about re-characterizing your traditional IRA.


3. Do I make too much to contribute to a Roth? 

Many clients we meet believe they “Make too much” to contribute to a “Roth IRA.” This is likely not the case. With Roth conversions, you can contribute to a Roth IRA at almost any income level. Talk to us about how to go about this if you have not already been making conversions.


If you are filing taxes for your business, here are three questions to consider:


4. Is there a Business Retirement Contributions deadline?

Businesses can make contributions until their tax deadline for the year (for 2020, the company typically has until April 15, 2021, of the next year for those on a calendar fiscal year). We recommend you talk with your accountant & advising team for more information.


5. Did you receive a Paycheck Protection Program (PPP) Loan in 2020?

You may have taxable income that you’re not expecting. Consult with your accountant and advising team about this and other important tax issues raised by PPP loans.


6. Is my Qualified Retirement document up to date?

To comply with current law, your document needs to be restated every 6 years with the most up to date version.


Whether it pertains to investments, retirement, insurance, or other financial services, our experienced advisors have you covered. Contact us at 850.300.7055 or uvest@wradvisors.com.

This article is meant to be general in nature and is not intended, and should not be construed as personal advice of any kind. Michael Davino is a Financial Advisor offering securities and investment advisory services through Waddell & Reed, Inc. and can be reached at 850.894.9950. Waddell & Reed, Inc. and its representatives do not offer tax advice.  Waddell & Reed, Inc., Member SIPC (02/21)