TAX TIPS

LAST CHANCE TAX SAVINGS!

• Max out on your tax - deferred retirement savings plan
• Make gifts before year end to reduce your estate. You can give $14,000.00 to as many individuals as you like, tax free
• Open and IRA

Most Americans are obsessed with tax refunds. More than 75% of U.S. taxpayers give the IRS an interest free loan every year. Then again others continue to owe. Both situations are easy to correct. Ask your employer for a new W-4, this form controls the tax withheld from your paycheck. The more allowances you claim on the W-4, the less tax will be withheld; the fewer you claim, the more tax will be withheld. You may also have a flat fee withheld. For some, higher withholding can help to eliminate the hassle of paying quarterly estimates for additional income. However, if you are self employed you must make your quarterly estimates.

HOW LONG DO YOU NEED TO KEEP OLD TAX RECORDS?

Go head and toss monthly statements, but keep year end statements for a minimum of three years after the due date of your return. That's how long the IRS has to audit a tax return, UNLESS you have significantly understated your income. Keep records of stock fund purchases, reinvested dividends and capital gains distributions, for as long as you hold those investments. When you sell them , you will need proof of the price you paid. Keep all tax returns at least six years, but you can shred supporting checks, receipts, etc. after a three year period.