As tax day approaches for those filing by April 15, it’s important to start preparing if you haven’t already—especially for those who won’t be filing extensions. Whether you’re self-filing or relying on a tax professional, now is the time to get organized. It’s a good idea to gather your investment account statements and keep track of any significant taxable events from the 2024 tax year. Being proactive about this documentation will help ensure a smoother filing process and potentially avoid any last-minute surprises.
Common Tax Documents that may be applicable to you:
- Form 1098 – Mortgage Interest Statement
- Form 1098E – Student Loan Interest Statement
- Form 1098T – Tuition Statement
- Form 1099 – Dividend, Interest, Capital Gains and Other Investment Income (**Be sure to gather these statements for all taxable accounts!)
- Form 1099-DIV – Dividend Income
- Form 1099-INT – Interest Income
- Form 1099-R – Distributions from Pensions, Annuities, Retirement Plans, IRAs, etc.
- Form 1099-SA – Distributions from an HSA, Archer MSA, or Medicare Advantage MSA
- Form 5498 – IRA Contribution Information
- Form SSA-1099 – Social Security and Railroad Retirement Benefits
- Form W-2 – Wage and Tax Statement
- Gain/Loss Report – Capital Gains/Loss Report (e.g. from custodian)
- Schedule K-1 – Partnership, S-Corp, Trust, and Estate Distributions
Important taxable events to note:
- Backdoor Roth IRA Conversions:
- This strategy enables “high earners” to bypass the income limits on direct Roth IRA contributions by contributing to a non-deductible Traditional IRA and then immediately converting the funds to a Roth IRA. The transaction(s) must be reported on Form 8606 for proper documentation. Make sure your non-deductible IRA contributions aren’t mistakenly counted as a regular Roth conversion. Doing so could result in the contribution being taxed twice—once as part of your gross income and again as an IRA distribution on your tax return.
- HSA Contributions/Distributions:
- HSAs offer tax-deductible contributions and tax-free distributions for qualified medical expenses. Employee and employer contributions, as well as distributions, are reported on Form 8889. Make sure your contributions/distributions maximize the tax savings these accounts provide!
- Tax-deductible Events:
- State and Local Real Estate Tax (SALT): For 2024, you can deduct up to $10,000 from your gross income for SALT taxes, which commonly include state and local property taxes as well as sales taxes.
- Mortgage Interest: Taxpayers can deduct home mortgage interest on the first $750,000 of indebtedness.
- Charitable Deduction: There are no overall limits on the amount of charitable deductions to a qualified 501(c)(3) organization, but the deductibility percentage varies based on the type of donation, such as cash, property, securities, etc.
- Student Loan Interest: Student loan interest qualifies as an above-the-line deduction, allowing taxpayers to claim it without itemizing deductions. Up to $2,500 in interest can be deducted from income when determining adjusted gross income (AGI).
- Capital Losses:
- Selling investable assets at a loss (as long as the “wash sale” rule is avoided) can offset capital gains. If capital losses exceed capital gains in a given year, up to $3,000 can be used to offset ordinary income, with any remaining losses carried forward to offset future capital gains. When managed strategically, these losses can enhance net investment returns. Be sure to track carryforward losses by recording them on Schedule D of your tax return—don’t miss out on any losses you’ve already harvested
Fortress Team Member Highlight – Our Chief Investment Strategist, Joshua Ali!
Where were you born?
I was born on Long Island, New York. I grew up with a big extended family and have fond memories of spending time with my sister and cousins.
How do you like to spend your time outside of work?
Spending time with my wife, Amy, our 9-month-old daughter, Rose, and our playful puppy, Silver, is truly the highlight of my day. One of our favorite things to do as a family is visiting Lake Eola Park in Orlando. It’s a great place for Rose to take in new sights and sounds and for us to create lasting memories together.
What is your favorite hobby?
Learning new recipes! I love discovering new dishes from different cultures and experimenting with flavors to make them my own. Cooking allows me to be creative while also enjoying the reward of a delicious meal.
What is the most memorable trip you’ve been on?
One of the most unforgettable trips of my life was to Key West—the place where I proposed to my now-wife, Amy. While it might not be the most exotic location, every time we go back, we’re reminded of how it marked the beginning of our journey together.
What did you want to be when you grew up?
I don’t think I ever had one specific career in mind when I was young, but I always knew I wanted to make a meaningful impact on people’s lives. Now, by helping families achieve their financial goals, I get to do just that.
Are you a sports fan?
Yes, I’m a huge fan of the New York Giants and Yankees. While the Giant’s might cause me a great deal of heartache in the recent past, one of my core memories is watching them win the 2008 and 2012 Superbowl with my family.
How many different states have you lived in?
I’ve lived in two states—New York and Florida. Like many Floridians, I’m a New York transplant who originally came to Florida for school, drawn by the warm weather and sunshine.
If you could only eat one meal for the rest of your life, what would it be?
If I had to choose just one meal for the rest of my life, it would have to be pizza—specifically, a classic New York slice. I’m not sure if I could eat it for every single meal, but I’d definitely give it my best shot!
What was your first job?
I worked at a drive-through convenience store called Dairy Barn.
What would you do if you were gifted a million dollars with no strings attached?
I’d probably take the boring route and invest it for our daughter’s future. I might set a little aside for a family trip or a fun experience, but the bulk of it would go toward securing a bright future for her.
For questions regarding the collection of necessary documentation, including tax statements from Fidelity accounts for filing a 2024 tax return, please don’t hesitate to reach out. Additional information will be provided in the coming days, with further communication specifically for our clients on this topic.