So, as we near the end of the year, we are spending time with family and friends enjoying the holidays.
Your taxes may not be in the front of your mind – but, perhaps you can take a few steps now to help reduce your tax burden this year and save you some money when you prepare your tax return next year!
Reducing your taxable income is one of the most effective ways to lower your taxes, with some moves doing double duty as both deductions themselves and as a means to slide under income thresholds at which other taxes would kick in.
While it’s late in the year now, there’s still time to take steps that will lower the amount of income you must report on your 2016 tax return.
Give to a charity!
If you itemize, making charitable contributions before December 31 will reduce your taxable income … and you are making a positive impact on the world.
For cash contributions, hang on to your canceled check or credit-card statement as proof of your donation. If you contribute $250 or more, you’ll also need an acknowledgment from the charity. Donations made by credit card before December 31 are deductible on your 2016 tax return, even if you pay the credit-card bill in January.
Donating appreciated securities can also reduce your taxable income. When you donate appreciated securities you have owned more than one year to charity, you can deduct the full value of the securities on the date of the gift. You won’t have to pay taxes on capital gains, and the charity won’t have to pay them, either.
So, it’s not too late to reduce your taxable income … give to you favorite charity now before the end of the calendar year and make a positive difference in an area that you care about.
Don’t have a favorite charity?
Consider giving to our work! Just go to our donation page (here) or to Network for Good (here) to give to a 501c3 tax-deductible charity that has been caring for abandoned and vulnerable children in Asia since 1997.