At the end of every year, millions of Americans can make strategic moves to shave a few bucks off their April tax bill. Right now, millions more should be able to get into the act, with Congressional Republicans poised to pass a 503-page law that fundamentally restructures the U.S. tax code.
If the bill passes, new tax rates and countless other provisions would go into effect on Jan. 1. Most of the old rules though would still apply in the last two weeks of 2017—and that gives individuals a shrinking window of time to employ strategies that would lower their taxes for next year’s tax season.
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If your taxes are set to spike in 2018, many of these strategies won’t work as well. But if you’re part of the majority who will see an initial tax benefit from the law, there could be big benefits for acting soon:
- Give to Charity: Giving to charity, a tax deduction that’s preserved under the tax bill, is an effective way to boost your 2017 deductions on short notice.
- Defer Income: In most years, deferring income merely delays the taxes you will have to pay eventually. But, if you expect your tax rate to fall next year, deferring income into 2018 could actually save you money.
- Pay Your Taxes—If You Can: However, any taxes due for 2017—or any late taxes from previous years—could still be deducted on a tax return due this April.
- Employee Expenses: So, workers should think about whether they can pay —and get the receipts—for as many of these expenses as possible this month, said Kathy Pickering, executive director of the Tax Institute at H&R Block.
- Pay For Your Move: Under the proposed law, you’ll no longer be allowed to deduct work-related moving expenses after the new year (unless you’re in the military).
Read the full article by Bloomberg about the tax bill from Fortune
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