Tags: year | end | tax | 401k

MarketWatch's Powell: Year-End Tax Issues You Should Address

By    |   Tuesday, 16 December 2014 09:48 AM

As the year winds down, various tax issues rise to the forefront. MarketWatch's Robert Powell addresses how you can deal with them.
  • Estimated taxes. If you pay them, you want to make sure that you've sent the Feds either 90 percent of the tax you'll owe for 2014 or 100 percent of the tax you owed for 2013 by your final payment.
  • Gifts. You can give up to $14,000 to as many people as you want tax-free.
  • Max out your contributions to your 401(k) and IRA plans. It may be too late to increase the contribution to your 401(k) this year, but it's worth contacting your human resources department to try. The contribution limit for a 401(k) this year is $17,500. You can make your 2014 tax year contribution to your IRA as late as April 15.
  • If you have stock, bond or mutual fund investments that are duds, consider selling them by year-end, as you can deduct a portion of the losses from your tax burden.
Accounting firm Grant Thornton offers the following year-end tax tips:
  • Accelerate deductions and defer income. "Deferring tax is a cornerstone of tax planning."
  • Bunch itemized deductions. "Many expenses can be deducted only if they exceed a certain percentage of adjusted gross income (AGI). Bunching itemized deductible expenses into one year can help you exceed these AGI floors."
  • Leverage state and local sales tax deduction. "If you itemize deductions, you can elect to deduct state and local sales tax instead of state income taxes."

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As the year winds down, various tax issues rise to the forefront. MarketWatch's Robert Powell addresses how you can deal with them.
year, end, tax, 401k
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2014-48-16
Tuesday, 16 December 2014 09:48 AM
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