Here are some things for EOG Resources 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
EOG Resources 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 EOG Resources employee, doing so may enable you to postpone payment of tax on the income until next year.
2. Accelerate deductions
EOG Resources 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 EOG Resources 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 EOG Resources 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 EOG Resources employees to request a Form W-4 change and for their employers from EOG Resources 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 EOG Resources 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 EOG Resources-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, EOG Resources 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 EOG Resources-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 EOG Resources employee age 72 or older, you generally must take required minimum distributions (RMDs) from traditional IRAs and EOG Resources-sponsored retirement plans (special rules apply if you're still working and participating in EOG Resources'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
EOG Resources 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 EOG Resources 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 type of retirement plan does EOG Resources offer to its employees?
EOG Resources offers a 401(k) Savings Plan to help employees save for retirement.
Is participation in the EOG Resources 401(k) plan mandatory for all employees?
Participation in the EOG Resources 401(k) plan is voluntary; employees can choose whether or not to enroll.
What is the employer match for contributions made to the EOG Resources 401(k) plan?
EOG Resources provides a matching contribution up to a certain percentage of the employee's salary, which is detailed in the plan documents.
How can employees at EOG Resources enroll in the 401(k) Savings Plan?
Employees at EOG Resources can enroll in the 401(k) Savings Plan through the company’s HR portal or by contacting the HR department for assistance.
What investment options are available in the EOG Resources 401(k) plan?
The EOG Resources 401(k) plan offers a variety of investment options, including mutual funds, target-date funds, and company stock.
Can EOG Resources employees change their contribution percentage at any time?
Yes, employees at EOG Resources can change their contribution percentage at any time, subject to plan rules.
What is the vesting schedule for EOG Resources' employer contributions to the 401(k) plan?
The vesting schedule for employer contributions at EOG Resources typically follows a set timeline, which is outlined in the plan documents.
Are loans available from the EOG Resources 401(k) plan?
Yes, EOG Resources allows employees to take loans from their 401(k) accounts under certain conditions.
What happens to the 401(k) savings if an employee leaves EOG Resources?
If an employee leaves EOG Resources, they can choose to roll over their 401(k) savings into another retirement account, withdraw the funds, or leave the savings in the EOG Resources plan, subject to plan rules.
Does EOG Resources offer financial education resources for employees regarding their 401(k) plan?
Yes, EOG Resources provides financial education resources and tools to help employees make informed decisions about their 401(k) savings.
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