Tip For Avoiding Year-end Tax Pitfalls
Investment advisors at The Zero Alpha Group produced a very good year-end tax planning conference call. Listen to it here, and you'll get details on ZAG's top four end-of-year tax pitfalls:
1) Blowing your bonus. Too many Americans spend their hard-earned bonus all at once on a luxury item and don’t consider how to apply a bonus to their financial plan in a smart way.
2) Giving gifts without an eye to cutting your taxes. Here’s something most people miss: Fully utilizing the annual exclusion for gifting amount ($11,000/$22,000 split gifting). You should think about moving money to children and grandchildren now if you have a potentially taxable estate.
3) Cluelessness on AMT. Here’s a really costly pitfall for the unwary: Not knowing what your tax situation is so that you are unable to assess whether or not you will be clobbered by the dreaded Alternative Minimum Tax (NYSE:AMT).
4) “Playing Santa Claus