Posted on January 07, 2005 at 08:09:42:
Planning to cut your taxes early—not just now for this April, but for next April’s tax return too.
Organize your files so you won’t be scrambling for receipts and broker’s statements. Set up a file now to hold W-2 and 1099 forms as they come in. Careful records of deductible items can save you big dollars—and provide proof if you’re ever audited. Keep all home-related records—purchase, loans and capital improvements.
Do you generally get a tax refund? Don’t be proud of it. That just means you’ve been lending Uncle Sam money interest-free. Better: Adjust your withholding so that you pay just enough and no more. File a new Form W-4 with your employer right away.
Arrange to have 401(k) and /or IRA contributions made automatically. If your employer offers a flexible spending account for medical or child-care services, use it. You don’t have to wait until you’ve maxed out your contribution in order to spend funds.