New Update: Healthcare Costs Increasing by Over 60% in Some States. Will you be impacted?

Essential Year-End Tax Strategies for Best Buy Employees: What You Need to Know Before 2023

Healthcare Provider Update: Healthcare Provider for Best Buy: Best Buy primarily collaborates with Aetna as their health insurance provider for employee health benefits. This partnership allows Best Buy to offer a range of insurance plans that include coverage for medical, dental, and vision services to its employees. Potential Healthcare Cost Increases in 2026: In 2026, employees at Best Buy are likely to face significant increases in healthcare costs, driven by a combination of rising premiums and potential changes in benefit structures. The expiration of enhanced federal subsidies for Affordable Care Act (ACA) plans could result in out-of-pocket premium costs surging by over 75% for many enrollees. Furthermore, employers, including Best Buy, are expected to shift more healthcare expenses onto workers, with 51% of companies likely to raise deductibles and out-of-pocket maximums. This scenario signals a critical need for employees to prepare for increased financial responsibilities regarding their healthcare. Click here to learn more

Here are some things for Best Buy employees and retirees to consider as they weigh potential tax moves between now and the end of the year.

1. Defer income to next year
Best Buy employees must consider opportunities to defer income to 2023, particularly if you think you may be in a lower tax bracket then. For example, you may be able to defer a year-end bonus or delay the collection of business debts, rent, and payments for services. As a Best Buy employee, doing so may enable you to postpone payment of tax on the income until next year.

2. Accelerate deductions
Best Buy employees and retirees should also look for opportunities to accelerate deductions into the current tax year. If you itemize deductions, making payments for deductible expenses such as medical expenses, qualifying interest, and state taxes before the end of the year (instead of paying them in early 2023) could make a difference on your 2022 return.

3. Make deductible charitable contributions
As a Best Buy employee, if you itemize deductions on your federal income tax return, you can generally deduct charitable contributions, but the deduction is limited to 50% (currently increased to 60% for cash contributions to public charities), 30%, or 20% of your adjusted gross income (AGI), depending on the type of property you give and the type of organization to which you contribute. (Excess amounts can be carried over for up to five years.)

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4. Bump up withholding to cover a tax shortfall
As a Best Buy employee, if it looks as though you will owe federal income tax for the year, consider increasing your withholding on Form W-4 for the remainder of the year to cover the shortfall. Time may be limited for Best Buy employees to request a Form W-4 change and for their employers from Best Buy to implement it in time for 2022. The biggest advantage in doing so is that withholding is considered as having been paid evenly throughout the year instead of when the dollars are actually taken from your paycheck. This strategy can be implemented by Best Buy employees to make up for low or missing quarterly estimated tax payments.

5. Save more for retirement
Deductible contributions to a traditional IRA and pre-tax contributions to a Best Buy-sponsored retirement plan such as a 401(k) can reduce your 2022 taxable income. As a fortune 500 employee, if you haven't already contributed up to the maximum amount allowed, consider doing so. For 2022, Best Buy employees can contribute up to $20,500 to a 401(k) plan ($27,000 if you're age 50 or older) and up to $6,000 to traditional and Roth IRAs combined ($7,000 if you're age 50 or older).* The window to make 2022 contributions to a Best Buy-sponsored plan generally closes at the end of the year, while you have until April 18, 2023, to make 2022 IRA contributions.

*Roth contributions are not deductible, but Roth-qualified distributions are not taxable.

6. Take the required minimum distributions
If you are a Best Buy employee age 72 or older, you generally must take required minimum distributions (RMDs) from traditional IRAs and Best Buy-sponsored retirement plans (special rules apply if you're still working and participating in Best Buy's retirement plan). You have to make the withdrawals by the date required — the end of the year for most individuals. The penalty for failing to do so is substantial: 50% of the amount that wasn't distributed on time. As a fortune 500 employee, making these distributions in a timely manner is essential as to avoid the late penalty.

7. Weigh year-end investment moves
Best Buy employees and retirees shouldn't let tax considerations drive investment decisions. However, it's worth considering the tax implications of any year-end investment moves that you make. For example, if you have realized net capital gains from selling securities at a profit, you might avoid being taxed on some or all of those gains by selling losing positions. As a Best Buy employee, any losses over and above the number of your gains can be used to offset up to $3,000 of ordinary income ($1,500 if your filing status is married filing separately) or carried forward to reduce your taxes in future years.

Tags: Financial Planning , Tax , Retirement , 2022

What is the 401(k) plan offered by Best Buy?

Best Buy offers a 401(k) plan that allows employees to save for retirement through pre-tax contributions, which can be invested in a variety of funds.

How does Best Buy match employee contributions to the 401(k) plan?

Best Buy matches employee contributions up to a certain percentage, helping employees maximize their retirement savings.

Can employees at Best Buy enroll in the 401(k) plan at any time?

Employees at Best Buy can enroll in the 401(k) plan during their initial eligibility period or during designated open enrollment periods.

What is the minimum age requirement for Best Buy employees to participate in the 401(k) plan?

Best Buy employees must be at least 21 years old to participate in the 401(k) plan.

Are there any fees associated with Best Buy's 401(k) plan?

Yes, Best Buy's 401(k) plan may have administrative fees and investment-related fees, which are disclosed in the plan documents.

How can Best Buy employees access their 401(k) account information?

Best Buy employees can access their 401(k) account information online through the plan's dedicated website or mobile app.

What investment options are available in Best Buy's 401(k) plan?

Best Buy's 401(k) plan offers a range of investment options, including mutual funds, target-date funds, and other investment vehicles.

Does Best Buy offer financial education resources for employees regarding the 401(k) plan?

Yes, Best Buy provides financial education resources and tools to help employees make informed decisions about their 401(k) savings.

What happens to the 401(k) plan if a Best Buy employee leaves the company?

If a Best Buy employee leaves the company, they can choose to roll over their 401(k) balance to another retirement account, cash out, or leave the funds in the Best Buy plan, subject to certain conditions.

Is there a vesting schedule for Best Buy's 401(k) matching contributions?

Yes, Best Buy has a vesting schedule for matching contributions, meaning employees must work for the company for a certain period to fully own the matched funds.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Best Buy is a leading provider of consumer electronics, home office products, entertainment products, and related services. The company operates a network of retail stores and online channels.

Best Buy offers RSUs and stock options to eligible employees. The stock options vest over time, providing long-term incentives.