Can’t believe we’re coming up on the end of the year! And guess what? Like it or not, January 1st marks the beginning of the tax season, too. I know you don’t want to think about it, but a little preparation now could make a big difference in your tax bill. There’s still time! Here are five things you can do to stay ahead of the Tax Man:
- Take it to the max! Contribute the maximum you can to your employer and individual retirement accounts. For 2015, the maximum contribution is $18,000; for individuals 50 and older, an additional $6,000 can be socked away. If you can manage putting in more, contact your payroll department to increase your contributions for these last few paychecks.
- Harvest losses and gains. If you had capital gains from the sale of assets this year (sale of stock or real estate, sale of a business, etc.) consider harvesting losses within your taxable investment accounts to offset against those gains.
- Use it or lose it! Check your flexible spending account (FSA) balances to make sure you have exhausted the funds — otherwise, those dollars are lost forever.
- Review your expenses. Consider bunching up expenses and paying them in this year instead of next. For example, you could pay property taxes or medical expenses. Also determine if you have expenses not reimbursed by your employer. All of these count as tax-deductible items.
- Share the cheer by making charitable donations. Depending on the charity, you could elect to give cash, stock, or in kind donations. Just be sure to get a receipt!
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