I know that most of our minds are pretty preoccupied with holiday preparations these days, but I don’t want us to lose track of another big date coming up in December: December 31st. With the coming of the year’s end, there are a few financial things that need to be taken care of soon. Most of the big decisions have been made (selecting your health insurance plan for 2010, for instance) but you should wrap up a few tax-planning details. Hopefully, they won’t take up too much of your time so that you can get right back to your holiday celebrations.
Review remaining funds in your flex-spending accounts. If you haven’t used all of your funds in your flexible spending accounts (like childcare or medical savings accounts), now is the time to figure out how you will spend the rest of that money. Make sure that you have submitted and all your receipts for purchases you have completed and make plans to spend the rest of your account. You might also find out if there is a grace period that allows you to spend that money after January 1.
Complete any tax-deductible transactions before the year ends. Are you planning to make any charitable contributions in this calendar year? Maybe you are planning to make a contribution to your IRA account. If any of these types of transactions are looming for you, make sure that you get them in before the 2009 tax deadlines. I like to pull out last year’s return to help me remember anything I might be overlooking.
Start building a tax file. Hopefully, you already have a tax folder for this year, but if you don’t, now is the time to put one together. You don’t have to spend a lot of time on it now, but you do need to get started. I lay the folder on my desk this time of year and leave it out. Then, as those important year-end papers start trickling in, I can simply toss them into the folder. They’ll be there waiting for me when I’m ready to turn my attention to our tax filing.
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Having a tax folder from the beginning of the year is the key.
That way, you can fill it up with your deductions as the year progresses, rather than trying to remember them all at the end.
Organization throughout the year will amek the end of the year stuff a breeze and doing your taxes much easier too.