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

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

Healthcare Provider Update: Freddie Mac offers a comprehensive benefits package that includes flexible healthcare plans such as POS, HMO, and high-deductible options with HSAs. Employees also receive dental, vision, life, and disability insurance, along with access to an on-site wellness center and fitness facilities. Additional perks include student loan repayment assistance, adoption and fertility benefits, legal services, commuter subsidies, and generous paid time off. The company contributes to 401(k) plans with matching and automatic contributions, and supports employee well-being through EAPs and backup care services 1. Freddie Mac Healthcare costs in the United States are projected to continue rising through 2026, with insurers proposing significant premium increases for Affordable Care Act (ACA) plans. A recent analysis found that ACA insurers are seeking a median premium increase of 15% for 2026, marking the largest hike since 2018. This surge is attributed to factors such as the anticipated expiration of enhanced premium tax credits, rising medical costsincluding expensive medications and increased hospital staysand a shift in the risk pool towards higher-cost enrollees. Without the renewal of enhanced subsidies, out-of-pocket premiums for ACA marketplace enrollees could increase by more than 75% on average. Click here to learn more

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

2. Accelerate deductions
Freddie Mac 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 Freddie Mac 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 Freddie Mac 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 Freddie Mac employees to request a Form W-4 change and for their employers from Freddie Mac 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 Freddie Mac 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 Freddie Mac-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, Freddie Mac 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 Freddie Mac-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 Freddie Mac employee age 72 or older, you generally must take required minimum distributions (RMDs) from traditional IRAs and Freddie Mac-sponsored retirement plans (special rules apply if you're still working and participating in Freddie Mac'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
Freddie Mac 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 Freddie Mac 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 savings plan does Freddie Mac offer to its employees?

Freddie Mac offers a 401(k) retirement savings plan to help employees save for their future.

Does Freddie Mac match employee contributions to the 401(k) plan?

Yes, Freddie Mac provides a matching contribution to employee 401(k) contributions, up to a certain percentage.

What is the eligibility requirement for Freddie Mac's 401(k) plan?

Employees at Freddie Mac are typically eligible to participate in the 401(k) plan after completing a specified period of service.

Can Freddie Mac employees make pre-tax contributions to their 401(k) plan?

Yes, Freddie Mac employees can make pre-tax contributions to their 401(k) plan, which can reduce their taxable income.

Does Freddie Mac allow after-tax contributions to the 401(k) plan?

Yes, Freddie Mac allows employees to make after-tax contributions to their 401(k) plan.

How often can Freddie Mac employees change their contribution amounts to the 401(k) plan?

Freddie Mac employees can change their contribution amounts to the 401(k) plan during designated enrollment periods or as specified by the plan rules.

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

Freddie Mac's 401(k) plan offers a variety of investment options, including mutual funds and other investment vehicles.

Is there a vesting schedule for Freddie Mac's matching contributions?

Yes, Freddie Mac has a vesting schedule for matching contributions, which determines when employees fully own those contributions.

How can Freddie Mac employees access their 401(k) account information?

Freddie Mac employees can access their 401(k) account information through the company's designated retirement plan website or portal.

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

If a Freddie Mac employee leaves the company, they can choose to roll over their 401(k) balance to another retirement account, withdraw the funds, or leave the account with Freddie Mac, subject to plan rules.

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

Freddie Mac is a government-sponsored enterprise that provides liquidity, stability, and affordability to the U.S. housing market. It supports the housing finance system through its various programs.

Freddie Mac provides RSUs to certain employees. The RSUs vest over a specific period, supporting employee retention.