With the holidays behind us and tax season upon us it is always a good time to review where you are financially, and to begin  planning for the coming year. Discuss these and other strategies with your financial and/or tax advisor.

• Workplace Retirement Accounts — Consider increasing your contributions to your 401(k), 403(b), 457, or other retirement account for 2016. If there have been any changes to your marital status or beneficiaries during the year, be sure to notify your plan
• Saver’s Credit — Don’t forget this significant benefit to help you save more for retirement. Depending on your adjusted gross income, you’ll receive a tax credit of up to 50% of your contribution of up to $2,000 for singles or $4,000 for married couples filing jointly. See gov: Saver’s Credit for more specifics.
• myRA — If you don’t have access to a retirement plan at work, consider saving in a new myRA See My Retirement Plan: myRA — Just the Facts [PDF] for more details. This program also qualifies for the Saver’s Credit, so this is a good motivation to explore this option — or an IRA — with your advisor.
• FAFSA — For students who want to receive federal financial aid for the 2016-2017 school year, the earlier you tackle FAFSA (Free Application for Federal Student Aid), the greater the options you’ll have. You can file as early as January 1, 2016, this year, but next year, you’ll be able to begin the process as early as October 1, 2016. Also watch for the new state and school deadlines for 2016-2017, which should be out
• Social Security — Buried in the government’s budget for 2016 are some huge changes to Social Security that will affect future retirees. One is the end of the file-and-suspend This allowed a primary recipient to suspend benefits, letting them continue to grow up to age 70. His/her spouse (or eligible children) could then collect benefits based on the primary person’s wage contribution. Those who suspended their benefits were also able to receive a lump sum payment for the benefits earned during the period they were suspended…but no more.

Note these dates: Couples can still use the file-and-suspend benefit if the primary earner reaches age 62 by January 1, 2016, and the spouse who will collect the benefits is age 66 by May 1, 2016. But they must act before April 29, 2016, to be grandfathered into the old program. We’ll cover some of the other major changes in a future issue.

• Flex Spending Accounts (FSAs) — You can set aside up to $2,550 in pre-tax dollars to pay for allowable expenses, but beware, if you don’t use it, you lose it. See if your employer offers a grace period of up to 2.5 months into 2016 to use the remaining funds, or allows you to carry over up to $500. If not, use all the funds now for co-payments or one of the allowable
• Withholding changes — This handy tax refund estimator will estimate how much tax refund you might receive this year. In 2015, the average was $2,800. But what if you had that money growing for you instead of for the government? Using Bankrate’s Savings Calculator, if the average worker saved $233/month ($2,800 ÷ 12) at 7% for 20 years, they would have roughly $121,380! To estimate your withholdings for 2016, use the IRS Withholding Calculator. Then, complete an updated W-4 [PDF].
• Play with the numbers — To save on taxes this year, discuss with your tax advisor about deferring potential income (capital gains, self- employment income, etc.) to 2016, or accelerating expenses (charitable deductions, college or healthcare expenses, property taxes, etc.) into Maneuvering expenses only makes sense if you itemize deductions rather than take the standard deduction, which is

$6,300 for singles or $12,600 for married couples filing jointly for 2015. Also discuss how these changes might affect AMT (Alternative Minimum Tax), a tax that increasingly affects middle class Americans.

• Limits for 2016 — The Society for Human Resource Management (SHRM) has provided just a few of the limits for commuting, adoption, FSAs, long-term care premiums, and more in their list of 2016 Limits. Discuss these with your advisor as

Stretching every dollar further and capitalizing on the latest tax strategies are critical goals in today’s economy. We hope this helps you and your advisor to set up a solid plan for 2016.