Taxes may be the last thing on your mind when you’re changing jobs, but overlooking their impact could mean missed tax-saving opportunities. Issues to consider include:
Your retirement plan. Distributions from retirement plans are generally taxable and may also be subject to an early withdrawal penalty. The penalty would also apply to amounts withheld for income taxes. When you leave a company, any unpaid 401(k) loan is also considered a taxable distribution if you don’t repay the loan according to the terms of your plan.
Planning tip: Have the money in your retirement account transferred directly into another qualified plan or an IRA. A direct rollover avoids automatic income tax withholding and income taxes.
Job-hunting expenses. You can deduct the costs of looking for a new job in your present line of work, even if you don’t get the job. Typical expenses include travel to job interviews, resume costs, and employment agency fees. You must itemize your deductions, and your total miscellaneous deductions must exceed 2% of your adjusted gross income.
Moving expenses. If you meet two tests, you can deduct the costs to move your household and personal effects, including your in-transit travel expenses and storage expenses.
First, the distance from your old home to your new workplace must be at least 50 miles farther than the distance from your old home to your old workplace.
Accounting and Tax Preparation Services in Milwaukee and Waukesha Wi
When your accounting tasks are too much to bear, don’t lose heart. Just call on Edith I Christian, CPA. We’ll help you maximize your earnings in a fast, efficient and economical fashion. With our peerless personnel, we can handle virtually any accounting and income tax need in a timely and efficient manner.
Edith Christian CPA
N9 W29360 Thames Road
Waukesha, WI 53188