Happy New Year, Savers and Investors! With 2024 upon us, now is a great time to start your new year financial planning because the IRS has released their updated and inflation adjusted numbers for the new Tax Year. So let’s dive into the top 3 tax minimization planning opportunities for you in 2024, so you can pay less in taxes, save more of your income, and build your wealth!
Three Big Financial Planning Updates:
The IRS provided a $500 increase to the 401k maximum contribution limit! Now you can save up to $23,000 total, or a maximum of 25% of your income, for people under the age of 50.
The IRS also has provided A 7% increase to the HSA maximum contribution limit! Which is now $4,150 for individuals, and $8,300 for family coverage.
And lastly, the IRS has increased the Standard Deduction by $1,500. Now you will get a Standard Deduction of up to $14,600 for single filers and $29,200 for joint filers.
Bonus Tax Saving Tip: Combining the max HSA contribution, max 401k contribution, and full Standard Deduction means you could reduce your taxable income as an individual by $41,750, and a couple married filing jointly can reduce income by $83,500. That’s powerful tax savings that benefit you both presently and in the future.
So the ball is in your court! The IRS has made the updates and now it’s time for you to take action. Proactive planning can mean saving hundreds to thousands of dollars, every year, on your taxes. So plan proactively to pay the government less in taxes, keep more of your cash flow, and save and invest to build your wealth and reach your own version of financial freedom.
About the author: Daniel Caycedo is an Investment & Tax Strategist and Wealth Management Advisor for CayDen Wealth Management, a Colorado registered investment advisory firm with offices located in Broomfield, Colorado and Charlotte, North Carolina. Daniel works out of CayDen Wealth Management's Charlotte office, providing virtual, fiduciary, comprehensive wealth management and tax services for high performing professionals and their families. Services include proactive Financial Planning, Investment Management, & Tax Services.