3 Actions to Save for Retirement & 5 Home Office Deduction Mistakes

Retirement actions

Three Actions to Save for Retirement

If you haven’t started saving for retirement or you haven’t saved enough, here are three actions you can take to put you in a better position during your golden years:

  1. Contribute as much as possible every year to a 401(k) pretax retirement plan, up to the $18,000 maximum, or $24,000 if you are age 50 or older.
  2. Contribute as much as possible to a Traditional or Roth IRA every year, up to the $5,500 maximum, or $6,500 if you are age 50 or older.
  3. Finally, contribute as much as possible to a health savings account (HSA), which can be used to offset medical expenses, up to $3,400 a year, or $4,400 if you are age 55 or older.

If you’d like to review your tax-advantaged retirement strategy, call us to schedule an appointment.

Five Home Office Deduction Mistakes

Here are five common mistakes of those who deduct home office expenses.

  1. Not taking it. Some believe the home office deduction is too complicated, while others believe taking the deduction increases your chance of being audited.
  2. Not exclusive or regular. The space you use must be used exclusively and regularly for your business.
    • Exclusively: Your home office cannot be used for another purpose.
    • Regularly: It should be the primary place for conducting regular business activities, such as recordkeeping and ordering.
  3. Mixing up your other work. If you are an employee for someone else in addition to running your own business, be careful in using your home office to do work for your employer. Generally, IRS rules state you can only use a home office deduction as an employee if your employer doesn’t provide you with a local
    office.
  4. The recapture problem. When selling your home you will need to account for any home office depreciation. This depreciation recapture rule creates a possible tax liability for many unsuspecting home office users.
  5. Not getting help. The home office deduction can be tricky, so ask for help, especially if you fall under one of these cases.

Takeaway

If you have questions about saving for retirement or home office deductions, please give us a call. We would be happy to help.

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Posted in Business Tips, Tax saving tips

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