Now is the time of year when people begin to think about peace, generosity‹and taxes? While it may seem to be much too early to worry about filing your tax return, the end of the year is a great time to get your records in order and take other steps that will minimize the hassles when tax time does roll around. It’s also often your last chance to take advantage of deductions or other tax-saving opportunities for the year. The Oklahoma Society of Certified Public Accountants provides this advice on getting a head start:
Take those last-minute deductions
Have you contributed the maximum allowed annual amount to an individual retirement account? Although you might not qualify for a deduction on your tax return, you generally have until April 15, 2013, to add to your account pre-taxes. If you’ve been meaning to set up a tax-advantaged college savings plan, or add more to an existing plan, you often have until year-end to get a state tax deduction or credit for a contribution this year. Additionally, you should act now to support your favorite charity. Donating gives you the chance to do something good and get a deduction for this year’s return. However, make sure you carefully document your donations. See IRS Publication 526: Charitable Contributions.