Year End Tax Planning Tips Follow Up
December 10, 2009
The year end tax tips I posted last month overlooked a few potential tax planning tips. Here they are:
Itemized Deductions
You may be able to save taxes this year and next by applying a bunching strategy to “miscellaneous” itemized deductions, medical expenses and other itemized deductions.
Homebuyer Tax Credit
Since the last article the $8,000 first time homebuyer credit has been extended to homes purchased before May 1, 2010 and the home buyer tax credit has been expanded to certain existing homeowners.
Estimated Tax Payments
If you anticipate a state income tax liability for 2009 and plan to make an estimated payment, consider making the payment before the end of 2009. However, this prepayment of state income tax may not be a benefit if the alternative minimum tax (AMT) applies.
Gift Tax Exclusion
You can save gift and estate taxes by making gifts sheltered by the annual gift tax exclusion before the end of the year. In 2009, you can give $13,000 to an unlimited number of individuals. This exclusion amount doubles for joint gifts made by a married couple
Early Mortgage Payment
Make your January mortgage payment before December 31st so you can claim the interest this year.
Happy tax planning and be sure to check with your tax advisor to see which of these tax strategies apply to you!
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