Year-End Tax Tips For April Savings - KLTV.com - Tyler, Longview, Jacksonville |ETX News

12/27/06

Year-End Tax Tips For April Savings

With Christmas over and the end of year almost here, today is the perfect time to start thinking about your taxes. Use these tips now so you can save on your tax return in April.

Think Green

Because of escalating gas and energy prices, the federal government is giving tax breaks to encourage people to conserve energy.

Specifically, if you do things to make your house more energy efficient - such as installing new windows or buying new appliances - you get a break on your return. Taxpayers can deduct as much as 10 percent of $5,000.

Additionally, if you buy a hybrid car you can get a tax benefit of up to $2,600.

Pay Your Mortgage One Day Early

Most people pay their mortgages in the first few days of the month. If you make your January mortgage payment one day earlier on Dec. 31 instead of Jan. 1, you can save money on your 2006 tax bill.

This is how it works. Let's say you have a home worth $150,000, you have a 6 percent interest rate and your mortgage payment every month is $750. By paying your mortgage one day early on Dec. 31, you will get a $187 tax interest deduction on your return.

Put More in Your 401(k)

The money you invest in your 401(k) retirement plan is pretax savings. This is really important because there are two tax benefits to 401(k) plans.

First, saving for retirement is always a good thing. At the same time, you lower your tax bill because the money you put in your 401(k) account does not count against your earned income. So the more money you put away, the less your return will be.

An individual can contribute up to $15,000 per year into a 401(k) . If you're over 50, the "catch up" provision allows you to put in $20,000 per year.

Any extra money you can put into your 401(k) in December will go a long way toward helping you with your retirement, as well as lower your tax obligation.

Unclaimed Refunds

This year, $92 million worth tax returns and refunds went unclaimed because they either got lost in the mail or people moved. That $92 million belongs to about 95,000 people in the United States. The average person is owed about $1,000.

If you are one of those people who didn't get the refund that you believe you deserve, call the IRS. You have until Dec. 31 to claim the money.

Start Working on Your Return Now

Start to gather the paperwork you need for your tax return. Although the holiday season can be hectic, the last couple weeks of the year are really slow at work for most people. You can use this time to get some paperwork done.

The IRS will let you start filing your taxes as early as mid-January. The faster you file, the faster you will get your refund.

Courtesy of www.abcnews.com

 

Mellody Hobson, president of Ariel Capital Management in Chicago (www.arielmutualfunds.com) is "Good Morning America's" personal finance expert.

  • NewsMore>>

  • More frozen custard, juicy burgers coming to Tyler Monday

    More frozen custard, juicy burgers coming to Tyler Monday

    Sunday, July 22 2018 9:36 PM EDT2018-07-23 01:36:39 GMT
    (Source: Freddy's Frozen Custard on Facebook)(Source: Freddy's Frozen Custard on Facebook)

    In this hot, humid weather, there just can't be enough ways to cool off, and frozen custard is one of our favorite ways to do so. 

    More >>

    In this hot, humid weather, there just can't be enough ways to cool off, and frozen custard is one of our favorite ways to do so. 

    More >>
  • Separated sisters were reunited in Longview after more than 50 years

    Separated sisters were reunited in Longview after more than 50 years

    Sunday, July 22 2018 7:00 PM EDT2018-07-22 23:00:48 GMT
    An unforgettable East Texas reunion as two sisters see each other again after more than 50 years apart. Charlie Mae Johnson and Dorothy Mae Davis have not seen each other in 55 years until their family reunion at Longview's Stamper park over the weekend. "We've been separated a long time. I know we were supposed to be having a reunion but I didn't know we were going to have my sister and her family here," Charlie Mae says. Through family circumstances, they were separated...More >>
    An unforgettable East Texas reunion as two sisters see each other again after more than 50 years apart. Charlie Mae Johnson and Dorothy Mae Davis have not seen each other in 55 years until their family reunion at Longview's Stamper park over the weekend. "We've been separated a long time. I know we were supposed to be having a reunion but I didn't know we were going to have my sister and her family here," Charlie Mae says. Through family circumstances, they were separated...More >>
  • Texas African American Museum striving to preserve history

    Texas African American Museum striving to preserve history

    Saturday, July 21 2018 5:25 PM EDT2018-07-21 21:25:02 GMT
    Often times, African American history is only recognized during the month of February.  Founders of the Texas African American Museum felt their history slowly slipping away, now they are hoping to change that with the opening of the museum. "Some of the things I've seen in this little museum, I've not seen in history books, I've not seen online," visitor Cramoeya Cooper said. Though it may be small, the Texas African American Museum packs an exurbanite amount of inf...More >>
    Often times, African American history is only recognized during the month of February.  Founders of the Texas African American Museum felt their history slowly slipping away, now they are hoping to change that with the opening of the museum. "Some of the things I've seen in this little museum, I've not seen in history books, I've not seen online," visitor Cramoeya Cooper said. Though it may be small, the Texas African American Museum packs an exurbanite amount of inf...More >>
Powered by Frankly