Health & Fitness
Financial Tips for December 2011
Financial Tips for December 2011, ideas to consider for legally reducing 2011 income tax total. Start planning now for 2012.
Financial Tips, for December 2011
Make Charitable Contributions
Consider making charitable contributions before year-end both to obtain the maximum tax deduction and to fulfill any charitable programs or commitments you may have established for the year.
Buy a New Car
If you need a new car, now is a great time to purchase or lease one. Frequently, dealers are anxious to clear out last year's inventory prior to year-end. In making your choice, consider the federal tax (and occasional state tax) advantages for buying fuel-efficient vehicles such as plug-in hybrids and electric vehicles.
Examine Investments
Examine your current investments to determine those with unrealized losses. Consider selling those investments to take the loss this year. You can deduct up to $3,000 in capital losses in excess of capital gains. However, do not let the tax savings outweigh the investment potential. You might consider "swapping" for a similar company in the same industry if you like the potential of the industry.
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Pay Tax-Deductible Expenses
Consider paying tax-deductible expenses prior to year-end. Some common examples are real estate taxes, quarterly state or local income taxes, investment-related expenses, and dues. These must be paid by December 31 to obtain a deduction this year.
Evaluate Your Progress
Evaluate your progress for the year. How close were you to your budget? Recalculate your net worth. Compare it to the value at the beginning of the year. How did you do? And, now consider a workable budget plan for 2012 that leaves you more net worth.