TITLE:  Minimize Next Year's Tax Bill

SOURCE:  MyAccountingPortal.Com

DATE POSTED:  1/9/02

Minimizing Next Year’s Tax Bill

What can you do now to reduce what you will owe in taxes next year? Here are two tips:

1. Keep all receipts and records that will help identify the credits and deductions to which you might be entitled:

• Business expenses,
• Charitable contributions,
• Child care,
• College expenses,
• Alimony,
• Deductible taxes, and
• Medical expenses.

2. Try to make the maximum contribution to any qualified retirement plan that you participate in—whether 401(k) plan, IRA, or other qualified retirement vehicle. Contributions that are deductible (to self-employed retirement plans and some IRAs) and pre-tax contributions to 401(k)s and other qualified plans, will cut your taxes this year. And allowable after-tax contributions, though not deductible or excludable this year, earn income that will be tax-deferred until withdrawn.

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