2022 Year-End Planning

As the end of 2022 approaches, we want to remind you of some important dates and potential planning strategies to execute.

Tax Strategies:

• Required Minimum Distributions (RMDs) from IRAs: unless this is your first year of RMDs, the penalty for not taking your RMD by the end of the year is 50% of the RMD.
• Qualified Charitable Distributions (QCDs): If you have an IRA checkbook, the charitable donation check must be cashed before 12/31/2022. Otherwise, if the check was meant to help satisfy an RMD, the amount of the QCD may be subject to a 50% penalty for an unsatisfied RMD. 
  • If you are not familiar with QCDs, here is a short educational video: AWMI QCD Strategy
• Roth Conversions: Even though you have until April 15^th, 2023 to make IRA and Roth IRA contributions, conversions must be done within the calendar year. Now is the time to begin talking with your advisor.
• Harvesting Losses: If you have unrealized losses in your portfolio, harvesting them may be a good strategy. Collaboration with your CPA can help you determine the impact of this strategy.

Life Events:

• Consider 2023 Cash Needs: If you have big expenses coming up in 2023, preparing now can create flexibility and options to have cash ready.
• Major Changes: Did you have any life events like a marriage, birth of a grandchild, death, or divorce? If yes, your estate planning documents and beneficiaries should be reviewed.
• Income Modifications: If there is a change in your income or how it is generated, strategies beyond the planning items above may benefit you.

Reviewing your Health Insurance:

• Maximizing your deductible: If you have met your deductible for the year or even your out-of-pocket maximum, you may benefit from getting any other medical procedures or examinations done before year-end.
• Open enrollment: Medicare.gov and Healthcare.gov open enrollment periods begin soon.
  • Medicare.gov is from October 15^th to December 7^th
  • Healthcare.gov is from November 1^st to January 15^th, 2023, though we recommend choosing a plan before the end of the year.

Reach out to your advisor if you think any of these year-end items apply to your life.  

Nic Cohen, CFP®
Financial Advisor

10/10/22