Quantcast
Get breaking news alerts via email

Click here to manage your alerts
Daniel Acker | Bloomberg News To get the EITC, workers must file a tax return, even if they are not required to file, and specifically claim the credit, the IRS said.
Utahns can save on taxes with these end-of-the-year tips
Contributions » Donating to charity or adding to a retirement fund can reduce your tax bill.
First Published Dec 05 2013 01:01 am • Last Updated Feb 14 2014 11:44 pm

It’s easy to get caught up in the holiday spending madness, but the tax man cometh.

April 15 is still months away, but December is the time taxpayers can help reduce the amount they owe the Internal Revenue Service with some last-minute spending changes.

Join the Discussion
Post a Comment

Finding deductions is much easier for filers who itemize, but there are options for many people in several income brackets.

All taxpayers should look at their own incomes to determine whether taking certain financial actions in December is worth it.

"You really want to look at your income, and if you do have income, you’ll want to look at that," said Terry Marti, an enrolled agent with H&R Block in Cottonwood Heights.

Charitable donations » As the spirit of the season takes hold of many Utahns, making donations to charities can have the double benefit of helping a worthy cause and providing a tax benefit, said Bill Brough, vice president of the Utah chapter of the National Association of Tax Professionals.

Not all donations have to be made in cash. They can be in-kind donations, accepting gently used items instead.

"By doing something like cleaning out a garage or closet and donating the items to a qualified charity, taxpayers will be able to take tax benefit on their taxes," said Bill Brunson, spokesman for the Internal Revenue Service.

It’s essential, though, that the charity be recognized as a 501(c)(3). To check, visit www.irs.gov.


story continues below
story continues below

It’s also important that those making donations check to make sure the group they are donating to is legitimate.

"Sometimes people get lured into making contributions that either aren’t reputable or are just flat-out fraudulent," said Rob Brough, executive vice president of Zions Bank.

He warns donors to be wary of emails that contain links to a website as "fraudsters can create spoof sites" that look real but in fact are not. Instead, he recommends going directly to a website by typing in the URL or calling a familiar phone number.

Retirement fund contributions » For those who have a 401(k) or an IRA, adding extra money at the end of the year can lead to a tax benefit as well.

"The issue there is you pay for the benefit you get," said Bill Brough, who is an accountant at Sandy’s Bottom Line Bookkeeping and Tax. "You still have to give up the money."

But he recommends it for anyone who has the cash on hand because planning for retirement at any age is important.

"The wonderful thing about using an IRA instead of a savings account is it clamps down on temptation to withdraw it early because of the penalties," Bill Brough said.

Mortgage » Homeowners can look at their income for the year, and use a tax calculator to estimate how much they’ll owe in taxes. If it’s high, making an extra mortgage payment can help reduce taxes. However, it will impact the following year’s taxes, the IRS’ Brunson warns.

"Sometimes you can cause something to happen in the accounting period you’re in, but keep in mind there might be a net result in the subsequent year," Brunson said. "If you make another month’s mortgage payment in December, you get a benefit in 2013, but it will affect you in 2014."

Next Page >


Copyright 2014 The Salt Lake Tribune. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Top Reader Comments Read All Comments Post a Comment
Click here to read all comments   Click here to post a comment


About Reader Comments


Reader comments on sltrib.com are the opinions of the writer, not The Salt Lake Tribune. We will delete comments containing obscenities, personal attacks and inappropriate or offensive remarks. Flagrant or repeat violators will be banned. If you see an objectionable comment, please alert us by clicking the arrow on the upper right side of the comment and selecting "Flag comment as inappropriate". If you've recently registered with Disqus or aren't seeing your comments immediately, you may need to verify your email address. To do so, visit disqus.com/account.
See more about comments here.
Staying Connected
Videos
Jobs
Contests and Promotions
  • Search Obituaries
  • Place an Obituary

  • Search Cars
  • Search Homes
  • Search Jobs
  • Search Marketplace
  • Search Legal Notices

  • Other Services
  • Advertise With Us
  • Subscribe to the Newspaper
  • Login to the Electronic Edition
  • Frequently Asked Questions
  • Contact a newsroom staff member
  • Access the Trib Archives
  • Privacy Policy
  • Missing your paper? Need to place your paper on vacation hold? For this and any other subscription related needs, click here or call 801.204.6100.