When December 31 arrives, there will few ways left to reduce your tax burden for 2016. Read this post for ideas of what you might do to lower your taxes. In addition, just like tax planning for 2016 is almost over, planning for 2017 is already upon us, and should be initiated within a month from now. If you haven’t planned well in 2016, now is the best time to prepare for 2017 with lots of options than to look back and have very few.
Things to do to reduce taxes before the end of 2016:
- Review your tax returns for the last three years with a competent adviser. Write down where there is carry-over from before so you can be sure to capture proper deductions for the coming new year.
- Check your tax-brackets to see how close you will be to the next tax bracket increase.
- If you are close to where brackets will change, considering paying expenses for next year in December, like your property tax on your home, or state income taxes in 2016.
- Also consider deferring income into 2017 if you can. Talk with your tax adviser for ideas that are practical and work.
- Consider depositing some money into a tax-deductible retirement plan, like an IRA.
- Consider paying your charitable organizations before the year-end.
- Refer to this alphabetized list of deductions the IRS has permitted in years gone by. This can help you think of additional ways to save taxes.
You have wiggle room to save taxes for this year, as long as you act now and not wait until January.
Now is the time to make plans for reducing your taxes before 2017 begins. This will allow you more deductions than if you wait until December of next year. Here is a report of all the many tax deductions you should consider taking in 2017. Discuss these strategies with your tax planner: strategies to consider discussing with your adviser.
Comprehensive list of things to do to reduce taxes in 2017:
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