Finish Out the Year Tax Smart

In addition to the hustle and bustle of the holiday season, the end of the year is also a time to fit in some last minute tax related strategies. Here are three tips to have a tax smart end of the year:

1. Don’t forget about mutual fund distributions and consider offsetting gains with losses by selling stock of decreased value.
2. For investors nearing or above the adjusted gross income threshold for application of the investment surtax, postponing the sale of appreciated securities or moving funds to tax-advantaged retirement accounts if possible, may be beneficial to avoid or lower the surtax.
3. Consider giving appreciated securities as gifts, up to $14,000 can be gifted without the need for a gift-tax return.
4. Consider donating appreciated securities to a charity that can accept them and deduct the securities’ value and avoid the capital gains tax on those securities.

See Sandra Block, Smart Year-End Moves to Trim Your 2014 Tax Bill, Kiplinger’s Personal Finance, Nov. 2014.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.