2023 Year-End Considerations — Part 1

Time for Taxes Money Financial Accounting Taxation Concept

{8.5 minutes to read}  Greetings to you and yours, I hope you are staying encouraged in spite of all that’s happening around us.

With the year-end to-do list to accomplish and holiday planning, it is not uncommon for us to feel stretched on all sides.

In this opinionated world we live in, just about anyone can “chime in” on what we ought to do, when we do, with whom we do, and how we do — I am wondering if certain roles are worth the cost. Is there still a role for a leader, or better yet, is a leader now simply a spokesperson who conveys to the public the opinions of the majority?

The nation’s leaders have their hands full — only a few weeks before the year ends, not enough is in the news on the upcoming tax season, and how to plan ahead. The ongoing wars, humanitarian crisis (here in NYC and in the Middle East), election planning, governmental divisiveness, and the list goes — no rest for the weary mind.

The endless outlets for news and information are making it more challenging to step away to do something different. I hope this article is worth your time.

Before I get into the article, from a tax planning viewpoint, it is evident that the current administration is committed to clean air and clean energy — so don’t forget to take advantage of the various credits that may be available to individuals and businesses. From homeowners’ credit, developers’/builders’ credit, and the popular employee retention credit (ERC), the latter is getting the attention of scammers — as such the IRS is scrutinizing it more closely. Please check out this credit on the IRS website

This is a two-part news article. The first article will include some tax and planning-related information geared toward individuals. The second part will be more geared towards businesses & entrepreneurs.

For Individuals:

 2023 Year-End Considerations*

  1. Loss Deduction: Ponzi-type or not —  How will the IRS allow the treatment of the loss in the case of financial fraud (most recently, Samuel Bankman-Fried was convicted)?
  2. Social Security Income triggers a higher tax bill for many taxpayers.
  3. Enrollment periods have begun — What changes to consider?
  4. Will the IRS come knocking on taxpayers’ doors? It depends.

* Some may impact the 2024 calendar/tax year. 

Is it a capital loss or a Ponzi-type loss?

As you may already know, the IRS limits certain investment capital losses to $3,000 per year. Unused loss can be carried forward and used against capital gain for subsequent year(s).

Notwithstanding the above, the IRS may allow a more favorable tax treatment to taxpayers who are victims of losses from Ponzi-type investment schemes. One method is the safe harbor rule, under Rev. Proc. 2009-20. Under this rule, a qualified investor may be allowed a deduction of up to 95% of a qualified investment, if such investor does not pursue any potential third-party recovery. What we don’t know is whether the IRS will allow fraudulent cryptocurrency investments to get this favorable treatment. We await guidance from the IRS.

According to Reuters, on November 2, 2023, Samuel Bankman-Fried (SBF), the FTX founder, was convicted of multi-billion-dollar FTX fraud. He was found guilty of “stealing from customers of his now-bankrupt cryptocurrency exchange in one of the biggest financial frauds on record.”  You can read the entire article at Reulers.com

The Social Security Income tax threshold has risen by approximately 9%. Who will be impacted?  

Under the Federal Insurance Contributions Act (FICA), taxpayers are required to make contributions by way of Social Security income tax. Many taxpayers will notice that their overall tax/contribution has increased. You may have also noticed that you dug a little deeper in your pocket to pay Social Security taxes in 2023. The cap is $160,200, and in 2024, it is $168,600. Income over the cap is not taxed for Social Security benefits (“SS”). While SS has an income threshold, Medicare tax has no limit. Please see the table below that reflects the Social Security Income threshold for the years listed. *If you are self-employed, you will pay double the taxes.

Year Income threshold Maximum Tax (employee portion at 6.2%) *
2022 $147,000 (for reference only) $9,114.00
2023 $160,200 $9,932.40
2024 $168,800 $10,453.20

It is that time of year — once again — Enrollment period

It is the enrollment period for various health related benefits and insurances. It may be wise to use this time to review other insurance policies, proxies and financial beneficiary designations, power of attorney(s), just to name a few. Don’t forget that relationships do evolve, as such your will, trust and/or next of kin may also need to be updated. In a past article – we share seven-year end essentials – that are still relevant – check out the list here.

Knock, knock — who is it? Could it be the IRS?

The IRS does make unannounced home or field visits to non-compliant taxpayers (individuals and businesses). However, only a few taxpayers are likely to get such a visit.

This past summer, the IRS announced it will end most (not all) unannounced visits to taxpayers by Revenue Officers (“RO”). Instead, taxpayers (individuals and businesses) with outstanding balances will be mailed letters to schedule in-office meetings with a RO. So, who will likely get a visit? According to the IRS, only “extremely limited situations where unannounced visits will occur.” What sparked this change? Read the details here on the IRS website.

Part 2 of this article will be geared towards entrepreneurs (independent contractors and small businesses)

If this is where you will get off — in the spirit of gratefulness — my hope is that we embrace a posture of gratitude in all seasons of life. In essence, gratitude is important for our overall well-being.


In recent months, I find myself reflecting on genuine human connections, considering our growing entitlement ways of being. I resided on this question: Is it of any value to express gratitude for that which I am entitled to?

According to the Oxford Dictionary, entitlement is “the belief that one is inherently deserving of privileges or special treatment.” On the other hand, gratitude is “the quality of being thankful; readiness to show appreciation for and to return kindness.”

In an article titled, “The Antidote to Entitlement” published by Heartofconnecting.com The article added that “research shows that gratitude is healthy for us and benefits kids and adults alike — gratitude plays a major role — protects us from entitlement, stress, and depression — gratitude is known to increase self-esteem, hope, empathy, and optimism.”

A similar article was published by growing leaders author, Tim Elmore. The author noted that, “gratitude enriches human life. It elevates, energizes, inspires and transforms.” Read the entire article here.

Let’s embrace and encourage a posture of gratitude — it’s a worthwhile contribution to our overall well-being, so choose wisely.

Be on the lookout for Part 2 of 2023 Year-end Considerations that impact our finances.

Thank you for reading.
With gratitude,

Nadine Riley, CPA
Founder, Masterpiece Accounting Group
Phone: (212) 966-9301
Email: info@mpagroupllc.com

The Masterpiece Accounting Group web, blogs, and articles are not rendering legal, accounting, or other professional advice. Tax strategies and techniques depend on your specific facts and circumstances. You should implement the information in this newsletter only with the advice of your tax and legal advisors.