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Hack Your Taxes Before Jan. 1

Hack Your Taxes Before Jan. 1

    If you live in the U.S., the due date to file your tax return isn’t until next April. If you want to get some major benefits on your taxes, though, you have to take action before the end of the year: after all, in April, you’re paying taxes for the year of 2008. There are plenty of loopholes that can provide you with some significant advantages, depending on your financial situation. The list below is only a smattering of possible opportunities; it may be worth consulting with a tax professional about your own situation, especially since not all of these opportunities will be useful for everyone.

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    1. Make early payments. If you make your first mortgage payment of 2009 before Jan. 1, you can deduct the interest on this year’s taxes. The same goes for any property taxes that are deductible. However, if you expect to owe more taxes in 2009 than in 2008, it might be worth holding off on those payments so you can take the deductions on next year’s taxes.
    2. Get elective surgery. If you’ve already paid for medical expenses this year totaling 7.5 percent of your adjusted gross income, you can deduct any medical costs over that amount. If you’ve been planning to get some sort of surgery, scheduling it before the end of the year can pay off. Stocking up on your medical supplies and can also qualify, as can making improvements to your home for medical purposes (installing a ramp or pull bars, for example).
    3. Take a look at your investment losses. If you’ve taken significant losses in investments recently, you can offset capital gains on your taxes or — if you have more losses than you have gains, you can reduce your taxable ordinary income by up to $3,000 on your tax return.
    4. Sell a second home. If you’re working on selling a second home and you can close before Jan. 1, try to do so: a loophole closes at the end of the year that allows homeowners with multiple houses to defer the gain from the sale of other properties.
    5. Buy a Honda hybrid. I’d never suggest running out and buying a car just to get a tax break, but if you’re planning to buy a Honda hybrid soon anyhow, be aware that you can get a tax credit of $525 on it — up until Jan. 1, at which point the tax credit will be eliminated. There are other credits available for other clean-fuel cars.
    6. Sign up for a conference. Paying professional dues, getting certified, going to conferences and other job-related expenses are tax deductible after you’ve passed a certain threshold — two percent of your adjusted gross income. You’ll want to make the payment before the end of the year, however.
    7. Give to charity. A favorite way to reduce taxes for quite a while, giving a few dollars to charity now can help your taxes come April. Quite a few charities are struggling to meet demands right now, especially food banks, by the way. Before you sign the check, however, check IRS Publication 78 to make sure that you’ll be able to deduct the donation. You don’t have to give cash, by the way.
    8. Spend money on your class room. If you are an educator, you can deduct up to $250 for purchasing educational materials for your classroom.
    9. Top off your retirement account. There are a whole stack of tax advantages associated with 401(k), 403(b), and IRA accounts — I won’t go into all of them right here, but check what opportunities your retirement account gives you. You may need to put more money in to get the full benefit, though.
    10. Open a business. The amount of deductions you can take even if you’re just posting garage sale finds on eBay are incredible. You can deduct everything from a percentage of your mortgage to bank fees. You can even write off business debts.
    11. Refinance your home. If you have to pay points to refinance your home, you can deduct them over the life of your new loan.
    12. Get your taxes prepared. You can deduct the cost of having your taxes prepared either as a miscellaneous deduction on your personal return or as a business expense. The same is often true for any legal, accounting or financial planning fees that relate to tax planning.
    13. Go back to school. There are both deductions and credits associated with higher education. If you pay for next semester before Jan. 1, you can take advantage of the deduction this year.
    14. Search for a new job. If you’re on a job search, related expenses like hiring a resume writer or paying a fee to an employment agency can be tax deductible. If you have to move to accept a job, those expenses are also deductible.
    15. Take money from Mom and Dad for your student loans. If your parents help you to pay down your student loans, you can still deduct the interest. If anyone else helps you out, though, no one gets to deduct that interest.

    It’s important to remember that a lot of these moves don’t make sense if you’re just doing them for the tax break. However, if you were planning to get some sort of elective surgery or buy a Honda hybrid, for instance, it may be reasonable to move up your schedule for the tax benefit. Take a close look at your overall financial picture before moving forward. Because everyone’s situation is different, you may want to consult with a professional and rely on his advice.

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    The Gentle Art of Saying No

    The Gentle Art of Saying No

    No!

    It’s a simple fact that you can never be productive if you take on too many commitments — you simply spread yourself too thin and will not be able to get anything done, at least not well or on time.

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    But requests for your time are coming in all the time — through phone, email, IM or in person. To stay productive, and minimize stress, you have to learn the Gentle Art of Saying No — an art that many people have problems with.

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    What’s so hard about saying no? Well, to start with, it can hurt, anger or disappoint the person you’re saying “no” to, and that’s not usually a fun task. Second, if you hope to work with that person in the future, you’ll want to continue to have a good relationship with that person, and saying “no” in the wrong way can jeopardize that.

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    But it doesn’t have to be difficult or hard on your relationship. Here are the Top 10 tips for learning the Gentle Art of Saying No:

    1. Value your time. Know your commitments, and how valuable your precious time is. Then, when someone asks you to dedicate some of your time to a new commitment, you’ll know that you simply cannot do it. And tell them that: “I just can’t right now … my plate is overloaded as it is.”
    2. Know your priorities. Even if you do have some extra time (which for many of us is rare), is this new commitment really the way you want to spend that time? For myself, I know that more commitments means less time with my wife and kids, who are more important to me than anything.
    3. Practice saying no. Practice makes perfect. Saying “no” as often as you can is a great way to get better at it and more comfortable with saying the word. And sometimes, repeating the word is the only way to get a message through to extremely persistent people. When they keep insisting, just keep saying no. Eventually, they’ll get the message.
    4. Don’t apologize. A common way to start out is “I’m sorry but …” as people think that it sounds more polite. While politeness is important, apologizing just makes it sound weaker. You need to be firm, and unapologetic about guarding your time.
    5. Stop being nice. Again, it’s important to be polite, but being nice by saying yes all the time only hurts you. When you make it easy for people to grab your time (or money), they will continue to do it. But if you erect a wall, they will look for easier targets. Show them that your time is well guarded by being firm and turning down as many requests (that are not on your top priority list) as possible.
    6. Say no to your boss. Sometimes we feel that we have to say yes to our boss — they’re our boss, right? And if we say “no” then we look like we can’t handle the work — at least, that’s the common reasoning. But in fact, it’s the opposite — explain to your boss that by taking on too many commitments, you are weakening your productivity and jeopardizing your existing commitments. If your boss insists that you take on the project, go over your project or task list and ask him/her to re-prioritize, explaining that there’s only so much you can take on at one time.
    7. Pre-empting. It’s often much easier to pre-empt requests than to say “no” to them after the request has been made. If you know that requests are likely to be made, perhaps in a meeting, just say to everyone as soon as you come into the meeting, “Look guys, just to let you know, my week is booked full with some urgent projects and I won’t be able to take on any new requests.”
    8. Get back to you. Instead of providing an answer then and there, it’s often better to tell the person you’ll give their request some thought and get back to them. This will allow you to give it some consideration, and check your commitments and priorities. Then, if you can’t take on the request, simply tell them: “After giving this some thought, and checking my commitments, I won’t be able to accommodate the request at this time.” At least you gave it some consideration.
    9. Maybe later. If this is an option that you’d like to keep open, instead of just shutting the door on the person, it’s often better to just say, “This sounds like an interesting opportunity, but I just don’t have the time at the moment. Perhaps you could check back with me in [give a time frame].” Next time, when they check back with you, you might have some free time on your hands.
    10. It’s not you, it’s me. This classic dating rejection can work in other situations. Don’t be insincere about it, though. Often the person or project is a good one, but it’s just not right for you, at least not at this time. Simply say so — you can compliment the idea, the project, the person, the organization … but say that it’s not the right fit, or it’s not what you’re looking for at this time. Only say this if it’s true — people can sense insincerity.

    Featured photo credit: Pexels via pexels.com

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