10 Year-End Money Moves to Save you $1,000s!
Nearing the end of the year most people are focused on the holidays, but by taking your eye off your finances you could be leaving thousands of dollars on the table. Shopping, wrapping and visiting with family and friends are all top of the list, but now is the best time to take a few key steps to ensure you end 2013 on a financial high note. Below you’ll find a checklist of 10 must-do end of year money moves to save or reduce your tax bill.
1. Max Out Retirement Plans: You can often contribute into 2014 for 2013′s tax return (confusing, I know) it’s a good time to max out or add additional funds to your retirement plan. If you don’t have retirement accounts such as an IRA or self-employed 401K set up, do it now. In some cases you need to set up the account before December 31, but you can still contribute until tax day in 2014.
People who are under the age of 50 as of December 31 can contribute up to $17,500 of their own money this year (not counting employer matches, that is) and those who are 50 or older by that date may contribute up to $23,000.
2. Save That Bonus: Many companies hand out holiday bonuses at the end of the year. While it’s tempting to spend your bonus on the holidays or something fun, consider setting aside a minimum of 50% of any bonus you receive.
3. Donate Stuff Now: Don’t wait until the New Year to clear out the clutter. Donate goods now for a tax deduction in 2013. If you don’t have time to head to your local donation center, look for a charity who will pick up donations at your door.
4. Make Cash Donations: Planning to make a cash donation soon? Send in your check before December 31 so you can write off your donation. Make sure you’re donating to a non-profit for a tax deduction.
5. Book Capital Losses: Sell investments that you’re carrying at a loss before December 31. If you want to hold on to those investments long-term you can buy them back in 2014 (you have to wait one month between selling and buying).
6. Spend To Get Last Minute Deductions: If you’re a business owner, it’s time to buy. Purchasing equipment and supplies that you will need in the coming months can be a huge help to your bottom line when it comes time for taxes. You can choose to deduct the expense all at once instead of using depreciation (where you take a percentage across several tax years). Homeowners should spend on improvements that will net them a nice tax deduction. For instance, buying Energy Star appliances that are deeply discounted at the end of year and could net you a tax rebate.
7. Use Your Coupons Before They Expire: Many coupons expire on the last day of the year, so make sure to use them now before they expire!
8. Give The Gift Of Money: Planning to send money to a family member? Do it before December 31. You can send up to $14,000 per person without tax concerns.
9. Use Up Your Healthcare & Dependent Care FSAs: In many cases you lose what you don’t use by December 31 (check your plan for details).
10. Get Your Free Credit Reports: If you haven’t already, get your free credit report now.
Bonus Move: Review 2013 finances and prep for 2014 with printable budget planners, debt trackers and more.
What end of year financial moves do you make?