Make us your home page
Instagram

Early preparation can ease 2013 tax filing burden

The last thing taxpayers are probably thinking about is tax season. But anyone hoping to position themselves well for an interesting tax year should probably give it some thought.

"For the last several years, Congress has given the taxpayers and the tax community these little jolts. They are at the point where they are making up tax laws for the year that has passed," said Merry Brodie, with Brodie Accounting Services.

Here are some things Brodie says taxpayers can do right now to get ready:

Get organized. Start gathering receipts and other items needed to support your 2013 returns. Day care receipts, health expenses and pay stubs all act as supporting documents for your returns.

Review the past. Sit with your old tax returns and current pay stubs and do an estimated tax return for 2013. If you can't do it yourself, spend about $50 to have a professional do it for you, Brodie said. The objective is to get an early idea of your tax liability so you can make proper adjustments.

Spend money to save money. "Everybody wants to save money on taxes and it takes money to save money," Brodie said. Actions such as increasing your 401(k) payments in these next few months or allocating money next year to medical reimbursement or dependent care accounts require you to pay pre-tax money, but they also lower your adjusted gross income, or AGI. The lower your AGI, the less you owe the government. You may even be able to do something as simple as adjust the withholding on your last few paychecks of the year to help bring your tax payments in line with your tax liability.

Be generous. Charitable donations can help you reduce taxes owed as long as you itemize your return. But be warned: A few $25 donations and a couple of Goodwill receipts are probably not going to help you much, Brodie said.

Know the law and act accordingly. It helps to be aware of tax law changes in any given year. In 2013, for example, higher-income individuals — singles with income of $200,000 or more or couples filing jointly with income of $250,000 or more — will pay more taxes.

The minimum for medical expense deductions for anyone under 65 increases from 7.5 percent to 10 percent of income, which means fewer people will qualify. In addition, the forgiveness debt on home foreclosures, sales tax deduction, private mortgage insurance deduction, teacher's classroom supplies deduction, tuition and fees deduction, and residential energy tax credit are only good for 2013. Taking action in these areas before the end of the year will put you in a position to take those deductions.

Consider the power of three. There is nothing wrong with doing your own taxes, Brodie said, but every three years it's a good idea to have an enrolled agent — a professional qualified to represent taxpayers before the Internal Revenue Service — complete or review your work. That way, if you missed something, you will still have time to file an amended return.

Early preparation can ease 2013 tax filing burden 12/20/13 [Last modified: Friday, December 20, 2013 6:08pm]
Photo reprints | Article reprints

Copyright: For copyright information, please check with the distributor of this item, Tribune News Service.
    

Join the discussion: Click to view comments, add yours

Loading...
  1. Legalized medical marijuana signed into law by Rick Scott

    State Roundup

    TALLAHASSEE — Gov. Rick Scott on Friday signed into law a broader medical marijuana system for the state, following through on a promise he made earlier this month.

    Gov. Rick Scott signed legislation on Friday that legalizes medical marijuana in Florida.
  2. Line of moms welcome Once Upon A Child to Carrollwood

    Business

    CARROLLWOOD — Strollers of all shapes and sizes are lined up in front of the store, and inside, there are racks of children's clothing in every color of the rainbow.

    At Once Upon A Child, you often as many baby strollers outside as you find baby furniture and accessories. It recently opened this location in Carrollwood. Photo by Danielle Hauser
  3. Pastries N Chaat brings North India cuisine to North Tampa

    Business

    TAMPA — Pastries N Chaat, a new restaurant offering Indian street food, opened this week near the University of South Florida.

    The menu at Pastries N Chaat includes a large variety of Biriyani, an entree owners say is beloved by millions. Photo courtesy of Pastries N Chaat.
  4. 'Garbage juice' seen as threat to drinking water in Florida Panhandle county

    Water

    To Waste Management, the nation's largest handler of garbage, the liquid that winds up at the bottom of a landfill is called "leachate," and it can safely be disposed of in a well that's 4,200 feet deep.

    Three samples that were displayed by Jackson County NAACP President Ronstance Pittman at a public meeting on Waste Management's deep well injection proposal. The sample on the left is full of leachate from the Jackson County landfill, the stuff that would be injected into the well. The sample on the right shows leachate after it's been treated at a wastewater treatment plant. The one in the middle is tap water.
  5. Honda denies covering up dangers of Takata air bags

    Autos

    With just a third of the defective Takata air bag inflators replaced nationwide, the corporate blame game of who will take responsibility — and pay — for the issue has shifted into another gear.

    Honda is denying covering up dangers of Takata air bags. | [Scott McIntyre, New York Times]