During the month of December, consider these year-end tax tips that could save you money when April 15th\u00a0comes around.<\/p>\n
If you plan on a itemizing your deductions, you can reduce your tax liability with an end-of-year donation to a\u00a0qualified charitable organization. Keep in mind, if you do not itemize your deductions, then you cannot claim this type of\u00a0tax deduction<\/a>.<\/p>\n If any of your investments have lost money, you can consider selling them to offset any capital gains that you may have. If you haven\u2019t taken any gains this year, then you can still deduct up to $3,000 in capital losses.<\/p>\n If it looks like you\u2019re going to owe money, or if you\u2019re going to be receiving a large tax refund, you should consider updating the number of exemptions on your\u00a0IRS Form W-4 (Employee\u2019s Withholding Allowance Certificate)<\/a>. Form W-4, which you file with your employer, tells them how much money to withhold from your paycheck for income tax purposes. If you want to avoid owing money on April 15th, you should increase your\u00a0tax withheld<\/a>\u00a0from each paycheck. On the other hand, if you anticipate a large refund, you may want to reduce the amount of tax withheld.<\/p>\n If you do not have a retirement plan at work, you can contribute to a traditional IRA and possibly get a deduction on this year\u2019s taxes. If you do have a retirement plan at work, you can contribute to a Roth IRA and pay no taxes when you withdraw the money in retirement. Either way, your investments grow tax-free.<\/p>\n IRS rules allow each individual to \u201cgift\u201d up to $14,000 per year (per donee) without incurring the\u00a0gift tax. If you\u2019re planning to make a large gift, consider making all or part of the gift\u00a0before\u00a0the end of the calendar year. That way, you can count the gift towards your 2017 annual gift tax exclusion. This will allow you to make another tax-free gift in 2018 if you want.<\/p>\n If you have money taken out of your paycheck pre-tax and put into Flexible Spending Account (FSA) for medical expenses, then it\u2019s recommended that you do two things.<\/p>\n First, make sure you are spending all of the money. Flexible Spending Accounts are usually \u201cuse it or lose it,\u201d so if you don\u2019t spend it by the end of the year, the money could disappear.<\/p>\n Second, look at the amount you are having withheld from your paycheck. Does it accurately reflect your expenses? If you have too much withheld, you\u2019ll lose the money at the end of the year. If you have too little withheld, you could end up paying a lot in taxes.<\/p>\n Sometimes you can only take a tax deduction if the total exceeds a certain percentage of your\u00a0Adjusted Gross Income (AGI)<\/a>. This most often occurs with medical expenses and miscellaneous deductions on your\u00a0Schedule A (Form 1040)<\/a>.<\/p>\n According to the IRS, \u201cyou can deduct only the amount of your medical and dental expenses that is more than 10% of your AGI.\u201d To take full advantage of these deductions, you may be able to bunch them into a given year. If you\u2019ve already exceeded the threshold for deducting medical expenses, then see if you can accelerate future expenses into the current year. Similarly, if you cannot meet the threshold for 2017, you might want to see if you can put off the expenses until after the New Year.<\/p>\n For more information, please see\u00a0IRS Publication 502 (Medical and Dental Expenses)<\/a>\u00a0and\u00a0IRS Publication 529 (Miscellaneous Deductions)<\/a>.<\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" During the month of December, consider these year-end tax tips that could save you money when April 15th\u00a0comes around. 1) Give to Charity If you plan on a itemizing your deductions, you can reduce your tax liability with an end-of-year donation to a\u00a0qualified charitable organization. Keep in mind, if you do not itemize your deductions, […]<\/p>\n","protected":false},"author":1,"featured_media":512,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[12,22,30,36,37,31,39,19],"tags":[],"class_list":["post-511","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-tax-preparation","category-family-and-taxes","category-federal-tax-returns","category-past-tax-returns","category-paying-taxes","category-tax-deductions","category-tax-strategies","category-taxes-and-investments"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.irs.com\/en\/wp-json\/wp\/v2\/posts\/511","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.irs.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.irs.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.irs.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.irs.com\/en\/wp-json\/wp\/v2\/comments?post=511"}],"version-history":[{"count":1,"href":"https:\/\/www.irs.com\/en\/wp-json\/wp\/v2\/posts\/511\/revisions"}],"predecessor-version":[{"id":9405,"href":"https:\/\/www.irs.com\/en\/wp-json\/wp\/v2\/posts\/511\/revisions\/9405"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.irs.com\/en\/wp-json\/wp\/v2\/media\/512"}],"wp:attachment":[{"href":"https:\/\/www.irs.com\/en\/wp-json\/wp\/v2\/media?parent=511"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.irs.com\/en\/wp-json\/wp\/v2\/categories?post=511"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.irs.com\/en\/wp-json\/wp\/v2\/tags?post=511"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}2) Sell Losing Investments to Offset Gains<\/h3>\n
3) Adjust Your Withholding on Form W-4<\/h3>\n
4) Open an IRA, or Contribute to an Existing IRA<\/h3>\n
5) Make an Excludable Gift<\/h3>\n
6) Evaluate \u2014 and Spend \u2014 Your Flexible Spending Account (FSA)<\/h3>\n
7) Bunch Your Expenses<\/h3>\n