Your options to defer income or accelerate deductions are limited after December 31, however there is still a lot you can do to make the tax-filing season easier.
Some strategies can help you lower your taxes, sometimes by thousands of dollars. Some help you save time and money when preparing your tax return. Other strategies help you avoid costly penalties and interest on both federal and state taxes. Following are some tips to help you keep more money in your pocket:
1. Organize your tax-related documents
2. Revisit whether you should make an IRA contribution
3. Make a last-minute estimated tax payment (you can still make a 4th quarter estimate payment!) to avoid or reduce penalties
4. Determine if you are eligible to take the home office deduction, and if so gather all pertinent information
5. If you own a business you may be able to make a retirement plan contribution
6. Get set up on a computerized accounting system now (as of the first of the year)
7. File and pay on time – your taxes are due April 15th even if you file for an extension
For 2014, you can change your change your 401(k) contributions (you may want to revisit whether to do a Roth 401(k) or regular 401(k). Employees can also change their withholdings throughout the year by filing a revised W-4. If you owe taxes you should increase your withholding or pay estimates.
Attention Businesses: Get set up on a computerized accounting system now (as of the first of the year) if you are not already.
For additional suggestions and tips please visit: https://turbotax.intuit.com/tax-tools/tax-tips/Tax-Planning-and-Checklists/Tax-Tips-After-January-1–2014/INF12070.html
Questions? Feel free to contact us at 802.878.1963. Davis & Hodgdon Associates has been assisting individuals and businesses in the Burlington Vermont Metro area for more than 20 years. If you have any questions or concerns please feel free to call 802.878.1963 or email [email protected].