Most people don't start thinking about their taxes until late January, but you can get a jump on 2013's taxes - and make sure you're giving yourself the opportunity for the biggest tax refund - by starting now. So here are five things you can do between now and Dec. 31 to maximize your 2013 tax refund.
- Feed your 401K or IRA. Max it out if you can. Many factors can affect your eligibility and contribution limits to either the Traditional IRA or Roth IRA — tax filing status, your current earned income level and whether or not you participate in a retirement plan at work. Use this calculator or contact your plan advisor to help you determine whether or not you are eligible to contribute to both the Traditional IRA and Roth IRA and the maximum amount that may be contributed.
- Boost your 2012 income. Taxes are going up next year so if you are due a bonus or any other money, claim it now.
- Plan your itemized deductions. Pay any medical expenses you can deduct by the year's end. If you are in the market for a new house, car or other pricey purchase, buy it now so you can deduct the sales tax or qualify for other deductions. An accountant or even an online tax preparation program can help you seek out possibly deductions and help you plan.
- Give to charity. This is the perfect time to clean out your garage and your closets and make a trip to Goodwill, the Salvation Army or another donation center. Or you can put something extra in the plate at church this Sunday. Whatever your preferred method of donating, doing it now rather than in January will help maximize your possible deductions.
- If you are retired or you're an individual making $35,000 or less, cash in any appreciated stock. This may be the last year for zero tax on capitol gains.