1. Make charitable contributions if you’re an itemizer. Charging gifts by credit card or mailing a check before the end of the year nails down a charitable contribution deduction for 2017.
2. Pay outstanding medical bills. If you itemize, you can deduct amounts charged this year or checks mailed before the end of the year.
3. Take your required minimum distribution (RMD). Those who are required to take distributions from IRAs and qualified retirement plans but fail to do so face a 50 percent penalty.
4. Use up your FSAs. If you have a medical FSA or dependent care FSA at work, use up your 2017 contributions.
5. Check eligibility for making a contribution to a health savings account. As long as you’re covered by a high-deductible health plan for all of December (and continue in such plan), you can make a full year tax-deductible contribution for 2017; no itemizing is required.
6. Take losses on securities. The stock market is open on December 30. Losses can offset gains and then up to $3,000 of ordinary income; excess losses can be carried over. Watch the wash sale rule.
7. Maximize your retirement savings. Contribute consistently to your 401(k) plan.
8. Prepay college tuition for a semester starting in the first three months of the year. This will allow you to claim an education credit on your 2017 return.
9. Consider deferred compensation arrangements for year-end bonuses. Lower tax rates in the future can mean big savings.
10. Increase tax payments to cover anticipated taxes. This can be done by taking a lump sum from your final paycheck or make/increase the final estimated tax payment in January.
Barbara Weltman, spokesperson for J.K. Lasser (J.K. Lasser’s Your Income Tax 2017), is an experienced media professional, ready to lend her expertise to print, online, and broadcast segments and is available for interviews and year-end tax questions. Barbara can be reached at: barbara@barbaraweltman.com. For more information about J.K. Lasser’s Your Income Tax 2017, visit www.jklasser.com.
