With the holidays in full swing, most of us aren't thinking about taxes next Spring. But before you know it, the Christmas gifts will turn to credit card bills and taking steps to reduce your tax liability now could make a jolly new year come tax time. So while you’re making your holiday list, consider adding these five things to make next April a little more enjoyable too.
Hit The Accelerator On Deductions
If you can, prepay your 2015 property and state income taxes before December 31 (unless your normally owe AMT, then hold off and pay these timely). Then make your full contributions to your 401(k) plan and individual retirement accounts. You can also prepay your January mortgage payments to capture any mortgage interest deductions this year. Plus that January mortgage payment will be out of the way when the Christmas credit card bills arrive.
'Tis The Season To Give To Your Favorite Charity
Doing good things can make you feel better about your taxes too. Donating stock or property can give you twice the benefit from your charitable contribution if you donate these instead of cash. Not only will you avoid the capital gains tax, but you'll also get to claim a write-off that may be equal to the asset's fair market value.