It's Not Too Late to Save on Your 2013 Taxes
With only a few days left in 2013, there are still a few things you can do to reduce your taxes. Many people make year-end charitable donations, both in cash as well as gifts of personal items to Goodwill and other organizations.
Cathy Ralston and Mick Pryor, Certified Public Accountants with Daniel Professional Group in Winston-Salem, have some suggestions for additional ways to reduce your tax liability. Ralston says consider 'bunching' your spending on deductible expenses that are based on when you spend the money.
"If you have a lot of medical expenses this year and you think you might qualify for a medical deduction, go ahead and get your prescriptions filled for 3 months' supply right now," she says. "Put money in a North Carolina 529 college savings plan now, because that's a deduction we're not going to have available after December 31st."
Some additional things to consider:
- Make an additional mortgage payment so your investment interest deduction will be higher.
- Pay tuition for yourself - or your child if they're at college - so you can take advantage of education credits.
- Teachers can also take advantage of the educational adjustment by spending up to $250 on supplies before the end of the year.
- People who are 70-and-a-half or older should remember take the required minimum distribution from their IRA.
Some new taxes went into effect in 2013. Mick Pryor says a new tax to support the health care overhaul may catch some taxpayers by surprise. He says folks who have significant net investment income, dividends, interest, capital gains, will see a 3.8% tax imposed on top of the regular tax, "and it's turned out to be a pretty significant number for quite a few folks."
Daniel Professional Group has other year-end financial information, as well as links to state and federal tax forms and FAQs on their website.
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