Willis Report: Things to do right now to save on taxes next year - FOX 35 News Orlando

Willis Report: Things to do right now to save on taxes next year

Posted: Updated:
  • Arizona HeadlinesMore>>

  • Stolen trailer returned to youth group

    Stolen trailer returned to youth group

    A thief stole a trailer full of sporting goods that meant a lot to a group of kids in north Phoenix.One of those kids made a discovery that got those items back.All of the equipment was returned back where it belongs at The Refuge Youth Center.
    A thief stole a trailer full of sporting goods that meant a lot to a group of kids in north Phoenix.One of those kids made a discovery that got those items back.All of the equipment was returned back where it belongs at The Refuge Youth Center.
  • GCU expansion plan has some pleased and others upset

    GCU expansion plan has some pleased and others upset

    Grand Canyon University officials may get an earful tonight from residents living near the expanding campus.The multi-million dollar expansion would see Grand Canyon University building east with new classrooms, student housing, and parking lots.
    Grand Canyon University officials may get an earful tonight from residents living near the expanding campus.The multi-million dollar expansion would see Grand Canyon University building east with new classrooms, student housing, and parking lots.
  • PCH doctors and nurses get heads shaved to raise cancer awareness

    PCH doctors and nurses get heads shaved to raise cancer awareness

    September is Pediatric Cancer Awareness month. Doctors and nurses at Phoenix Children's Hospital, where many young patients are treated, created quite the "buzz" on Tuesday, making a "bald" statement to raise money for research. FOX 10's Anita Roman reports.
    September is Pediatric Cancer Awareness month. Doctors and nurses at Phoenix Children's Hospital, where many young patients are treated, created quite the "buzz" on Tuesday, making a "bald" statement to raise money for research. FOX 10's Anita Roman reports.

If you're smart about your money, you've probably already started thinking about what you can do before the year ends to reduce your tax bill. There are lots of changes awaiting taxpayers on April 15 thanks to the Affordable Care Act and the American Taxpayer Relief Act of 2012 -- not much of it good.

First things first: If you have a large portfolio or earnings above $200,000, now is the time to run a simulation of what your taxes may look like for next year. That way, you can at least get a sense of what you'll be on the hook for come April 15, 2014.

Next, if you're expecting a bonus or year-end income that will push you into a higher bracket, consider deferring that money into next year. Hold off selling assets that will produce a capital gain.

If you're self-employed, don't send out invoices for year-end jobs until early next year. Keep in mind, high earners are facing a new top tax bracket of 39.6 percent on taxable income of $400,000 for single earners and $450,000 for married couples.

Even if you aren't in the top tax bracket, it makes sense to salt more money into your 401(k). That will reduce your income reported to the IRS since most plan contributions are made before taxes are taken out. Remember if you are 50 or older, you can put in an extra $5,500 over the $17,500 limit.

Now is also a good time to review the limits on your flexible spending accounts. Under Obamacare, the limit on the amount you can set aside pretax was set at $2,500. (Before the ACA, there was no statutory limit on contributions.) Some companies allow a grace period to use untouched FSA funds, but not all. Plus, the Treasury recently announced changes to the use-it-or-lose-it rule. Now, account holders can carry over up to $500 in excess money into the next benefit year, as long as your company adopts that plan.

Also important to consider: The chances of mutual funds passing on long-term capital gains distributions are high. Fund companies release estimates of distributions this month. If you're planning on selling a fund, do it before distributions.

Now is also the time of year to consider charitable contributions. Make sure your contributions go to an eligible 501(c)(3) organization so that you can take the deduction.

Interact with Gerri on Twitter @GerriWillisFBN and Facebook for more information, or to voice your concerns and questions.

Didn't find what
you were looking for?

Powered by WorldNow

35 Skyline Drive
Lake Mary, FL 32746

Phone: (407) 644-3535
News Tips: (866) 55-FOX35

Didn't find what you were looking for?
All content © Copyright 2000 - 2014 Fox Television Stations, Inc. and Worldnow. All Rights Reserved.
Privacy Policy | New Terms of Service What's new | Ad Choices