After Christmas Tax Savings – Stay at Home and Cut Your Tax Bill

Posted on December 28, 2007
Filed Under Finance, Free, Shopping, Tax Tips, Tips |

Here are some simple things you can do to cut your tax bill. You can do all of these things from home, and save a bunch of money!

Clear out your stuff. Find clothes and items around your house that you don’t need and donate them to your favorite charity. (If you donate cash to a charity, ask the question – “how much of my donation will actually go towards helping people?” I am often appalled at the answer – sometimes as low as 10%! If administration costs are 90% then something is WRONG!). Turbo Tax has a tool which tells you the value of your donated goods – very helpful indeed! One more thing – many charities will pick up from your home or office!
Sign up for membership at your favorite museum. These memberships are often fully tax deductible, and are a much better deal than buying tickets at the door.
Donate to public television and radio.
Spend your FSA money! FSA accounts are use-it-or-lose-it propositions. If you contribute to a flexible spending account that requires you to spend your money by 12/31 – you better get a move on! You can buy a lot of items over the internet and spend that money. Here are some ideas
- Blood Pressure Monitors
- Defibrillator - not a bad thing to have around if a loved one has a heart condition
- Heating Pad
- Humidifier
- Pulse Oximeter - great for measuring oxygen content in the blood - particularly useful for runners and small children
- Advil, Tylenol, Pepto, Alka-Seltzer, and any other OTC drugs
- Fill your prescriptions and claim the co-pays
- Other Popular Items
Review your investments, and sell your losers (but watch out for the wash sale rule!) to offset your winners. I also read in the Wall Street Journal that rich folks are selling their long term stocks, since the low capital gains rate may go up in a year or so!
If you have a small business, buy your business related items now. Many items can be fully depreciated at once, including things like computers. If you’re profitable, this may be something to think about. (Thinking about a mac? This may be the time to get one and deduct it as a business expense!)
Invest in yourself! Think about the upcoming review season. If you want to move into management, you should seriously consider subscribing to a journal such as the Harvard Business Review, and start reading some of the Thomas Friedman books! These can all probably be deducted as business expenses too. (Also – check with your employer, they may happily pay for these as employee development and training costs!)