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SMART YEAR END TAX SAVING MOVES FOR 2016

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Now is the time. With less than two months left in 2016 time is running out to dramatically reduce your tax bill. Here are our top suggestions:

Accelerate your write offs

Medical Deductions Consider elective procedures if you have already exceeded your out of pocket maximum and 10% of your adjusted gross income.
Interest Expense Pay your January 2017 mortgage payment in December and you can deduct the interest portion on your 2016 tax return.
Taxes Mail your state fourth quarter estimated tax payment by 12/31 and don’t forget sales tax on large purchases.
Beat The Standard Deduction If you take the standard deduction each year consider using the above strategies all in the same year to have your itemized deductions exceed the standard every other year.

Keep more of your investment income

Pay No Capital Gains Tax Sell stocks with large gains and offset them against any capital losses being carried forward. Alternatively sell losing stocks to offset realized gains. Also consider selling if you are in the 15% or less tax bracket.
Reduce The Surtax Purchase municipal bonds or do a like-kind exchange of investment real estate.
Eliminate Capital Gains Donate appreciated stock to qualified charities and not only avoid capital gains tax but also claim a tax deduction!

What to do if you don’t itemize

Medical Consider paying your medical bills with a Health Savings Account (HSA) to cover out of pocket expenses and/or if you don’t itemize.
Social Security Reduce taxable social security benefits by reducing taxable investment income.

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