11 Great End-of-Year Tax Gifts You Should Give Yourself

Alden Wicker
Posted

save on taxesThe last thing that you probably want to think about this month is taxes, but now is actually the perfect time to tackle some key end-of-year tax planning that could save you beaucoup bucks come April.

Samantha Vient, a Certified Financial Planner (CFP®) with LearnVest Planning, recently clued us into something big that could impact you personally: the dreaded fiscal cliff.

We wrote a nuts-and-bolts story about the fiscal cliff, but here’s what you basically need to know: Unless Congress stops fighting and comes to a compromise before New Year’s to extend certain tax cuts and perks, you could end up paying thousands more in taxes next year–money you likely had earmarked for your IRA.

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“The bottom line is that taxes are supposedly going to go up,” says our trusty financial advisor Samantha. “The government could certainly extend the cuts, but there’s this push and pull between cutting spending or raising taxes–and they are going to fight down to the wire.”

Luckily, you’ve got LearnVest on your side. Although we can’t fix this fiscal cliff mess for you, we can give you some sage and understandable advice to help you scale it.

There’s just one catch: You gotta do it now. Ready? Let’s go!

  • Engchik

    this article is SO HELPFUL- esp the freelance section!!! THX! PS- those of us who freelance- keep track of everything!

  • Brianne Archer

    I’m pretty sure an HSA and an FSA are two different things. An HSA is an account that can only be created and contributed to if you have the right health insurance, like a high-deductible PPO plan. An FSA is a flex spending account that you can contribute to if you have any other insurance and the maximum for 2013 has been reduced to $2,500 as part of the Affordable Care Act. You can’t have both, it’s one or the other. The FSA is the use-it-or-lose-it account but the HSA can also work as a retirement slush fund to pay for your medical expenses in retirement un-taxed..

    BTW, are people still getting year end bonuses? I certainly haven’t seen one in years. 

  • http://www.facebook.com/profile.php?id=1467647784 Toni Bradley L

    An FSA is setup during open enrollment so you can’t just contribute whenever you want.  It’s an employer-provided benefit.  An HSA requires a particular high-deductible health insurance.  These are typically used by the self-employed.  I’ve used both.  HSA’s are also much more restrictive now than in the past. 

    For the new year, I’m taking advantage of a new pre-tax savings for premiums.  We have to buy health insurance for my husband outside of his work, which gives us no tax benefit.  Now, the dollar amount of his monthly premium will be withheld from my pay and deposited into a reimbursement account like an FSA and childcare savings.  Once it’s been paid, I can get reimbursed for what is in the account.  The first month will be tight because the funds have to be in the account to be reimbursed, unlike the FSA, but will save us tax dollars for the entire year.

    At this point in time, most people can make little difference to their current year tax situation.  If you want to truly help folks, LearnVest, run articles like this quarterly.  For people with FSAs, you might catch them during their open enrollment when they can make a change for the new year, and people also can have a little time to schedule doctor’s appointments when it can really happen versus at the end of the year when everyone is scrambling to get ready for the holidays and half of the office is already taking days off.  Stop running these types of articles at the same time as everyone else.  Everyone says the same thing.  Very, very few of these tips are useful for folks without a mortgage that gets them to the point of itemizing in the first place.