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The purpose of Income Tax planning is to reduce the income taxes paid to federal, state, and local governments. Individuals and families can use two Income Tax Planning strategies to reduce their income tax burdens.

(1) They can Invest in available Tax Advantaged Investment Alternatives.
For example, the investment return provided by investments in municipal bonds is not taxable by the federal government and might also be exempt from state and local income taxes. Various retirement plans allow people to accumulate funds for use in retirement on a tax-deductible and tax deferred basis. People should carefully consider each type of Investment that provides tax advantages.

(2) They can take advantage of tax deductions and tax credits.
The federal Income Tax code allows individuals and families to deduct certain expenses and other amounts from their annual income before calculating their federal income tax liability. Interest paid on their home mortgages, medical expenses that exceed a certain percentage of annual income, contributions to qualifies retirement plans, and amounts contributed to charitable organizations are examples of such deductions. The Federal Income Tax code also allows certain credits to be deducted from an Individual's or a Family's Income Tax Liability. For example, low income workers raising children might be able to use the earned income credit to reduce the amount of federal income tax they must pay.

Income Tax planning can help Individuals and Families increase their current standard of living and increase the amount they can accumulate for retirement and other long term needs. It is an important part of most people's financial planning.





A quick checklist of common items to remember for this year taxes:

  • W2 Income
  • Dependents
  • Earned Income Credit
  • Child Tax Credits
  • Current Students
  • Retirement Income
  • Itemized Deductions
  • Child and Dependent Care
  • Mortgage Interest
  • Real Estate Taxes
  • Student Loan Interest
  • Health Savings Account (HSA)
  • Adoption Credits
  • Stocks Gains and Losses, Sales of Home or other Investments
  • Royalty and Schedule K-1 Income
  • Investment Income expenses
  • Rental Property Income
  • Foreign Bank and Financial accounts
  • Freelance Income
  • Business and Farm Income
  • Personalized Business Deductions
  • Depreciation Calculations

Starting with the 2019 plan year, the Federal Shared Responsibility Payment no longer applies. However, some states have their own individual health insurance mandate, requiring you to have qualifying health coverage or pay a fee with your state taxes.Please read the following statements carefully. More than one might apply to your “tax family”.

(a) If you had health care coverage with a government Marketplace (Exchange) during 2019. Please provide Form 1095-A, issued by the Marketplace. In some family situations you may have more than one 1095-A.
(b) If you are claiming someone on your return who was included on another taxpayer’s policy with a Marketplace. If so, then you will also need a copy of that taxpayer’s 1095-A.
(c)  If a dependent filed a return for 2019. Provide a copy of the return.
(d)  If you had compliant health insurance through an employer plan, private policy or with a government plan and provide Form 1095-B, 1095-C or other proof of insurance document.
(e) If you were issued a hardship exemption by the Marketplace (Exchange). Provide all applicable exemption certificate numbers issued for each member of your family.
(f) Complete the information below if you or any individual included in your “tax family” did NOT have Insurance coverage for any month of 2019.

Please check any months a member of your “tax family” was NOT insured.