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

Here are some things for Comerica 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
Comerica 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 Comerica employee, doing so may enable you to postpone payment of tax on the income until next year.

2. Accelerate deductions
Comerica 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 Comerica 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 Comerica 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 Comerica employees to request a Form W-4 change and for their employers from Comerica 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 Comerica 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 Comerica-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, Comerica 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 Comerica-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 Comerica employee age 72 or older, you generally must take required minimum distributions (RMDs) from traditional IRAs and Comerica-sponsored retirement plans (special rules apply if you're still working and participating in Comerica'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
Comerica 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 Comerica 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 primary purpose of Comerica's 401(k) plan?

The primary purpose of Comerica's 401(k) plan is to help employees save for retirement by allowing them to contribute a portion of their salary on a pre-tax or after-tax basis.

How can Comerica employees enroll in the 401(k) plan?

Comerica employees can enroll in the 401(k) plan by accessing the employee benefits portal and following the enrollment instructions provided.

What types of contributions can Comerica employees make to their 401(k) accounts?

Comerica employees can make pre-tax contributions, Roth (after-tax) contributions, and may also have the option for catch-up contributions if they are age 50 or older.

Does Comerica offer any matching contributions to the 401(k) plan?

Yes, Comerica offers a matching contribution to the 401(k) plan, which is based on employee contributions up to a certain percentage of their salary.

What is the vesting schedule for Comerica's 401(k) matching contributions?

The vesting schedule for Comerica's 401(k) matching contributions typically follows a graded schedule, meaning employees become vested in the company match over a period of time.

Can Comerica employees take loans against their 401(k) accounts?

Yes, Comerica employees may be able to take loans against their 401(k) accounts, subject to the plan's terms and conditions.

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

Comerica's 401(k) plan offers a variety of investment options, including mutual funds, target-date funds, and other investment vehicles to suit different risk tolerances.

How often can Comerica employees change their 401(k) contribution amounts?

Comerica employees can typically change their 401(k) contribution amounts at any time, subject to the plan's guidelines and payroll processing schedules.

What happens to a Comerica employee's 401(k) account if they leave the company?

If a Comerica 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 Comerica plan if allowed.

Is there a minimum contribution requirement for Comerica's 401(k) plan?

Comerica's 401(k) plan may have a minimum contribution requirement, which is typically outlined in the plan documents.

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

Comerica has announced a restructuring plan that includes significant layoffs affecting several departments. The company is also revising its benefit offerings and adjusting its pension plans.