By doing a little work now, you won’t suddenly find yourself scrambling to get your affairs in order come tax time.
Summer is behind us. It’s officially fall. While it’s hard to believe, the end of the year is just around the corner. Pretty soon you’re going to be patting yourself on the back for leaving up last year’s Christmas lights.
While you’re gearing up for the holidays, now is the perfect time to take a look at your taxes and do a few other financial chores. Do a little work now and you won’t suddenly find yourself scrambling to get your affairs in order come tax time. Sound good? We think so too.
Step 1 – Get a Handle on Your Tax Deductions
To make sure you aren’t giving Uncle Sam any more money than absolutely necessary, it’s important to know exactly what tax deductions you can take. For example, if purchase a new home, you can deduct the interest on your mortgage. Have kids who went to a summer day camp or after school care? Make sure to keep those receipts. Under the Child and Dependent Care Credit, you can deduct up to $3,000 for one child ($6,000 for two or more) if the activity allowed you or your spouse to work. (Unfortunately, overnight camps are not eligible.)
Step 2 – Manage Your Debt
Carrying a hefty credit card balance can be costly. You know that large pile of junk mail you haven’t had time to deal with? It could be your money saving goldmine. Sort through the stack for any credit card offers. If you have a decent credit score, you could secure deal for transferring your debt, such as 18 months with 0 percent interest. But, be sure to pay attention to the fees. If they are exorbitant, this will cut into your savings or eliminate it all together.
Step 3 – Block Out Black Friday
Block out Black Friday on your calendar. Remember, Black Friday is the day on which traditionally stores offer all sorts of bargains. It’s the perfect time to pick up Christmas gifts for loved ones and items you need. This year Black Friday is November 27. It’s by far one of the best times to score Christmas gifts and keep your holiday spending to a minimum. If you have a lot of techies in your life, you’ll also want to consider Cyber Monday.
Curious what other tax deductions you qualify for as a homeowner? Contact me today!
Tax tips and debt advice to round out the year by Brian J. O’Connor