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Tax Tips
More Tax Planning Tips
by Michael Chadwick (Write for us!)
(Click on the links within the article to get definition of that word)

Sell those losers.
If you have securities that have taken a bath now may be the time for some year end tax loss harvesting. This will help offset some of the gains that we've had for the year. (It's so nice to have gains, isn't it?)

Give Birth.
Today there are all types of credits, exemptions and deductions for little ones. Betsy & I often refer to Hannah & Sammy not as kids, but as Curtain Climbers, Tricycle Motors, and Rugrats. Whatever you call them, they are such a blessing. A blessing not only from up above but from Uncle Sam as well.

Don't get married.
If wedding vows are on your mind consider holding off until January. If you get married on 12/31 you'll be considered married for the entire tax year. Married couples actually pay a marriage penalty and do not receive any "breaks" as most people believe.

Educate.
If you have tuition payments in the future, consider paying them now and perhaps they'll allow you to take advantage of the lifetime learning credit or the Hope credit.

Tax Deferral.
If you have substantial assets that you are not using in a taxable environment consider shifting it to a tax deferred environment where you can stop paying tax on the interest and dividends you earn each year. This will not only help this year but each and every year to follow.

Pay the mortgage or the Home Equity Loan (Line.)
If you pay January's payment now and it's processed by the end of the year the interest will show up in the statement you receive from the mortgage company. As long as you can itemize and your home is not worth $10,000,000, you'll end up with more tax deductions.

Medical Expenses.
Beginning this year all medical insurance premiums are deductible regardless of business type. Your other medical plans have some benefits within them if you happen to have a Medical Savings Account or Flexible Spending Account.

Business changes.
The new laws allowing for larger purchases and higher Section 179 limits now provide for incentive to invest in our small businesses. What could have taken 5 or 10 years to fully deduct before can now be fully deducted this year. Today you can even buy a truck or SUV through your business, for your business and receive a deduction. This was intended for people to buy business vehicles but with the new breed of SUV's on the market they fit the bill with a towing capacity of over 6000 pounds.