Newspaper article THE JOURNAL RECORD

Taxpayers Should Consider Saving Steps

Newspaper article THE JOURNAL RECORD

Taxpayers Should Consider Saving Steps

Article excerpt

In a season dominated by Santa Claus, save a little of your time and attention for Uncle Sam.

So advise the nation's tax experts, noting that the clock runs out this month not only on holiday shopping plans but also on most practical ways to cut your tax bill for the year.

"Don't wait until you're well into 1994 to think about your tax status," urged Greg Sullivan, vice president at the International Association for Financial Planning.

You will have plenty of time after New Year's to calculate your tax bill for 1993, he notes, but only limited opportunities to take any action about it.

What follows is a basic, though by no means comprehensive, check list of last-minute tax planning possibilities for the year: Contributions to charity. You can get 1993 deductions for charitable contributions of money made by check or credit card through Dec. 31. If you give tangible items such as old clothes or household goods, take care to document your contribution. State and local taxes. Pay bills for estimated state income taxes, local property taxes, and so forth by Dec. 31 so that you can deduct them on this year's return. Deferring income and accelerating expenses. If you are self-employed or can otherwise control when you receive income, hold off billing customers until after the first of the year. Similarly, pay for any pending deductible business expenses before the end of the year. Retirement savings contributions. If you are eligible to contribute to a tax-favored Keogh retirement savings plan for this year, you will have until the due date of your tax return to deposit the money. But the plan must be in operation by Dec. 31.

Contributions to employer-sponsored 401(k) plans must be made by Dec. 31. Individual retirement accounts, by contrast, can be opened and contributed to until the filing deadline in April. …

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