The Year-End Numbers Game
Today's topic is some tips to minimize your income taxes due in the spring. Generally speaking, you have until April 15th to contribute to your IRAs for 2011. But by completing this before year end, you may be eligible for some tax savings and credits. Also look at increasing your 401k and 403b contributions as they will decrease your taxable income.
Do you have securities that are less than what your original investment was? It’s possible you can harvest those tax losses and offset some income.
What about deductions? If you purchased a new home, you’ll have mortgage interest. Or if you are newly into the workforce after years of college, student loan interest or expenses related to job searches can be deducted. Don’t forget about energy efficient upgrades you did to your home or home improvements if you’ve got an office in the home. And keep those health related receipts if you’ve had a year filled with unexpected health costs and challenges.
Meet with your tax advisor before the year ends to compile some estimates and determine what your income tax bracket will be and any year end moves you can do to save.