Another tax day is quickly approaching and we hope that you’re on time to file by April 15th. Missouri taxes are a fact of life when you have a full-time job, but our tax liability will likely change once you retire from your full time job. If you’re still working, you’re probably hoping your taxes will decrease after you retire. While that’s probably true, it’s still important to speak to Kansas City Tax Mediation about taking control of your tax situation and to help you plan to minimize your tax liability in retirement.
- One of the things you can do now to minimize your taxes after you retire is to reduce your expenses. How will this help you? If you don’t spend a lot of money every month, you won’t have to withdraw as much from your retirement fund! By keeping your expenses moderate, you’ll be able to stay under the 15% tax bracket and take advantages of many tax breaks.
- Pay your mortgage off before you retire as this is normally your largest monthly bill. If you can get rid of that, you’ll have a lot more flexibility in your retirement. It’s harder to minimize taxes if you’re withdrawing a large amount to pay your monthly mortgage.
- Minimize tax on your social security benefits. As your income increases, you will pay more and more taxes on your social security benefits. This is another reason to minimize your retirement expenses so that you can minimize tax on your social security benefits.