Here are a few things YOU MIGHT NOT KNOW that you can do that may save you some 2011 tax dollars:
1) Make a charitable contribution.
If the last minute contribution is for more than $250, it must be documented by a contemporaneous acknowledgement from the donor organization.
2) Make a contribution to an IRA, 401(k) or other retirement account.
Most retirement plans actually give you up until April 15, 2012 to make a contribution as long as you designate that the contribution should apply to the 2011 Tax Year.
3) Fund a Health Savings Account or a Medical Savings Account.
The money put into these accounts is tax deductible up to certain limits and is not taxed when it is taken out as long as it is used for medical expenses. Any funds put into either of these account types before December 31 can be counted as a tax deduction for 2011 even though will not used for medical expenses until 2012. At the end of each year, money in these savings accounts that has not been used to cover medical expenses during the current year can be rolled over for use during the next calendar year.
4) Consider selling investments that are down if you have sold investments that have shown gains in 2011.
Although the entire amount of capital gains is taxed during the year they are realized, the maximum yearly deduction for capital losses is $3000. However, any capital gains realized during a calendar year can be offset by capital losses posted during the same year. This tax law essentially allows you to increase the allowable capital loss deduction by the entire amount of any gains realized during the same year.
5) If you own a small business, consider making equipment purchases.
A special tax code makes it an advantage to purchase business tools and equipment before the end of 2011. Although the cost of a capital expenditure usually must be depreciated over the predicted life of the equipment, a special tax code allows you to deduct the full amount of a purchase, up to certain limits, in the calendar year it is made. This amount is $500,000 for 2011 but will drop to $139,000 in 2012 and then to $25,000 per year. However, since it's already past Dec 31, 2011 you can take advantage of this on your next filing for your 2012 Tax Returns on or before April 15, 2013.
If you have other questions here is their information:
Professional Tax Resolution
2100 Main Street, Suite 240
Irvine, CA 92614
Phone: (949) 596-4143
