Taking control of your taxes topic #78 – JOB LOSS – Income Tax Saving Part 12

Filed in Gather Money Essential by on March 24, 2012 0 Comments

Unemployment and Income Tax Savings

Saving Money on Your Tax – Summary

This post summarizes the topic of reducing your income tax liability.  There is not much you can do about 2011 taxes, but many months are left to get your 2012 tax in order.

1. Have general understanding of tax rules.

2. Estimate your tax liability for this year so that you can withhold
appropriate amount from your paycheck.

3. Use as many tax reducing incentives to lower overall tax liability
(401(k), flex spending accounts, various tax credits).

4. Optimize itemized deductions using deduction lumping method.

5. Have a long term tax reduction strategy
(Shift funds to tax-deferred or tax free accounts, or to children)

Large tax refunds may mean that you lack discipline in your spending habits!

This completes the series on  Unemployment and Income Tax Savings.

Next post will focus on  Unemployment and Debts

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