A Month-by-Month Plan
to Lighten Your 2017 Tax Burden
Most people dread dealing with taxes, so each season they procrastinate until it’s too late to reduce their bill. According to tax attorney Barbara Weltman, breaking down your tax responsibilities into bite-sized steps will help you file next year with confidence and minimal hassle.
The new year is finally here, and if you’re like most people, you’re still in full-on resolution mode and motivated to improve your life. You probably haven’t thought about your taxes in regards to your yearly resolutions, but according to tax and business attorney Barbara Weltman, you should. She says that by committing now to lightening your tax burden, you’ll come out ahead next tax season.
“Taxes, and the impact they have on your finances, can seem totally overwhelming by the time tax season rolls around,” says Weltman, who is the spokesperson for J.K. Lasser’s Your Income Tax 2017. “But when you take small steps each month, you’ll be able to better manage your tax obligations and improve your financial standing by this time next year!”
The book Weltman represents is written to help the average taxpayer successfully navigate the filing process. With full coverage of all changes and adjustments to the tax laws – including new deductions and credits – it provides clear, plain-English explanations that help readers decipher the tax code and reduce what taxpayers owe. Ready to add a resolution that really pays off? Keep reading for month-by-month steps to improve on your tax picture for 2017 and beyond.
January: Start the year off right by making a resolution to face your tax responsibilities head-on. For example, schedule a meeting with your tax advisor to review your goals for the year and learn the steps you can take to improve your tax picture.
February: Decide now what to do with your tax refund if you expect to receive one. Do you want to pay off debt? Save for the future? You can, for example, use a tax refund to save on your 2016 return by funding an IRA or health savings account or save for the future by buying U.S. savings bonds.
March: Don’t let the approaching tax deadline freak you out, but do take action if you know you’re running behind. File for an extension now to get more time to file if you need it.
April: Contribute to an IRA or a Roth IRA now. If you don’t currently have one, do some research and learn which option is better for you.
May: Now that the school year is coming to an end, are there new graduates in the family? Think about how you can help to get them started in the real world. Let them know, for example, that they can stay on a parent’s health plan until age 26.
June: Thinking about taking a summer vacation? Find out if you can turn your vacation into a deductible expense. Also think about renting out a home you own to bring in some extra income.
July: Consider taking a mid-year review of your finances and tax picture. Assess the performance of the investment options you chose for your 401(k) and IRAs so you can make changes if needed.
August: Get in on the sharing economy through Uber, Airbnb, or another venue to bring in additional income. But keep in mind that as an independent contractor, there’s no withholding on your earnings, so you have to cover your tax bill.
September: It’s back-to-school time, and tax breaks can help alleviate the cost. Financial aid offices can assist with loans, work-study programs, and other ways to help finance the cost of higher education, so get ready to file the FAFSA next month. October: Select your health coverage plans for the coming year. Enrollment through employer plans and the Marketplace begins soon. Decide on whether to commit to a medical FSA at work. Find out whether a health savings account (HSA) is good for you.
November: As the holiday season approaches, get into a charitable mood. Whether you give a little or a lot, deductible contributions can help your tax picture. December: Review your portfolio. Make time now to take gains and losses that will allow you to reposition your portfolio while achieving the best tax results. “Don’t spend another year doing less than you should to improve your tax picture,” urges Weltman. “Small manageable steps are the key to staying in control of your finances – and you’ll see that they really add up to huge savings over time.”
About the Book: J.K. Lasser Institute has been the premier publisher of consumer tax guides since 1939, when Jacob Kay Lasser first published Your Income Tax. Since then, the guide has been published continuously for over 70 years and read by over 39,000,000 people. J.K. Lasser’s Your Income Tax 2017 (Wiley, October 2016, Paperback and e-book, ISBN: 978-1-119-24820-0, $24.95) has the perfect blend of expert advice; up-to-date information; and clear, jargon-free explanations to help the average taxpayer successfully navigate the filing process. For more information visit www.jklasser.com.
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