The holidays are now in full swing and the new year is just weeks away. When 2010 arrives, we will have to start thinking about something we generally don’t wish to: tax season. But tax season doesn’t have to be an unpleasant time.
Taxpayers who take control of their money and their finances now, before the end of this year, will be taking control of their taxes, before April rolls around. Many events happen throughout the year which may affect your finances and your tax situation, so, planning ahead and meeting with a tax advisor before year end may help to make April 15th a less “taxing” time.
Below are some tips to help get you ready for the next tax filing season.
1. If you are able to, maximize your Individual Retirement Accounts. If you are 50 years or older, you are now allowed to contribute up to $6,000. Also, you may consider contributing to a Roth IRA. While contributions to a Roth IRA are not tax-free, earnings on them are. Roth IRAs are not subject to the minimum distribution requirements for traditional IRAs. Also make sure to speak to your tax advisor regarding Roth IRA conversion opportunities in 2010.
2. People with a 401(k) can contribute up to $16,500. And those 50 years and over get a $5,500 catch-up contribution.
3. Timing the sale of certain investments to reap the most tax benefits should be decided before taking action. Take advantage of the $3,000 loss allowed on your tax return each year if you have losers in your portfolio or be sure to take unrealized losses if you have sold some assets at a profit this year. Please note that, if you sell a stock at a loss and then want to buy it back when the price increases, you may have to wait 30 days to use the initial loss to offset other income.
4. If you’ve had a foreclosure this year, you may benefit from the Mortgage Forgiveness Debt Relief Act of 2007. After foreclosure, the amount of forgiven debt is typically treated as income and is taxed. But to help people who are affected by the mortgage crisis, Congress excluded homeowners whose mortgage debt was forgiven in years 2007, 2008 and 2009.
About Gilman Ciocia, Inc.
Gilman Ciocia is a leading provider of federal, state and local tax preparation services to individuals in New York, New Jersey and South Florida. Securities offered through Prime Capital Services, Inc. Member FINRA/SIPC. Gilman Ciocia and Prime Capital Services, Inc. are affiliated entities. Neither offers legal advice.
Richard Schwartz, Branch Manager of the 3231 E. Tremont Ave. location, could be reached by phone at 718-518-7800 and by e-mail at rschwartz@gtax.com.
To make an appointment with a Gilman Ciocia Tax Professional in the Bronx, please call 1-800-TAX-TEAM or visit their corporate website here.
First time clients SAVE 25% on our Tax Preparation Fee when you come in by April 15, 2010.
*For preparation of basic 1040 and state returns. Not to be combined with any other offer. Non-negotiable. No cash value.
