Three Brilliant Year-End Tax Moves You Need to Make

Smart Year-end Tax moves

The end of the year is upon us, and that means it’s time to make some serious year-end tax moves to save you money and reduce your tax liability going into the New Year. This is your last chance to make some important year-end tax moves to help you out when it’s time to file your all important income tax return at the beginning of the year. Doing this now is going to (hopefully) save you money, stress and even time. According to Kiplinger, 2015 has been a relatively sour year for most investors.

What this means is that it’s time to stop wallowing in your self-pity and make a few year-end tax moves that will turn your sour finances into something a little sweeter. After all, there is always a silver lining. In 2015, it’s that you’re going to see some reduced tax liability thanks to an otherwise miserable financial year, and that can add a bit of hope and a smile to the end of an otherwise dismal tax year.

Give the Gift of an Education

If you’re a parent or grandparent, now is a great time to pay off some of your kid’s or grandkid’s tuition to take some advantage of tax credits. It’s one of the best year-end tax moves to make since it’s going to benefit everyone. You pay your grandchild’s tuition for the year and you get an exemption from the gift-tax up to $14,000. This is a great way to give a gift and still take some tax breaks from it. Do it now, though, before the year is up. And yes, you can pay for next semester now.

Pay it All Now

Since most of the tax rules have not changed much this year and very likely will not change much as we ring in the New Year, now is a good time to go back and look to see what you can do to make your income taxes a little bit more upbeat. One way to do this, one of our favorite year-end tax moves to make, is to pay things before the beginning of the New Year.

For example, you can pay your mortgage payment for January on December 31 to ensure you get to claim the mortgage interest on it for an additional month. You can make some serious donations and get them in writing so you can claim those. Contribute to your retirement account before the year ends. Pay an additional bit of tax on your quarterlies, too. Paying for these things and doing these things before 2015 is over mean you can take advantage of these tax deductions in January.

Deduct Retirement Contributions Early

While you have until tax day to make IRA contributions you can claim on your prior year income tax return, one of the best year-end tax moves to make is to ask your employer if you can contribute your retirement contributions a little bit early to other accounts. If you can do this before the New Year arrives, you can take advantage of those tax breaks when you file at the beginning of the year.

Of course, this is not something that works with every employer, but explaining that you’re making some great year-end tax moves might convince your employer to help you out.

Photo by Getty Images


Leave a Reply