Fall Means…Tax Time?

by Enter The Story

Post by Contributing Writer, Rachael

Fall is tax time?  Yes!  Fall is a great time to take a look at your finances before the end of the year. Regardless of if you choose to itemize your deductions or take a standard deduction, tax filings are based on a January 1 – December 31 calendar period, even though tax day is April 15th!

The opportunity for tax deductions can pass you by if you are not prepared.  Grab your calendar and start planning to make sure this year is the exception and you receive the benefits the IRS (Internal Revenue Service) provides for.

Here are some areas to take a closer look at.  It might be great to have a notebook and pen next to you in case you need to make appointments or to-do lists.

Charitable Donations

by zieak

Charitable Donations are documented donations (must have a receipt, bank roll, payroll slip or other written documentation) that are given to a qualified organization.  Qualified organizations most of us are familiar with are churches, schools and family help organizations like the Salvation Army. Donations can be cash but can also be stock, clothing, household items, etc.

To Do:

  • Make sure all your donations are made by December 31st. A lot of organizations receive donations at the very end of the year so the sooner you make your donation the easier it is to get the tax documentation you need before the busy season.  Some places also stop taking donations at the end of the year so you don’t want to miss out on a donation opportunity.
  • Make a to-do list of items and places to donate. You may need to collect used items around your house, have items appraised for value or know specific rules for certain kinds of donations, like vehicle donation.

IRS Publications: If you are interested in knowing more about Charitable Donations check out the following:

Publication 78: Cumulative List of Charitable Organizations
Publication 526: Charitable Contributions

Savings Accounts/Flexible Spending Plans

by tjmwatson

Specific Savings Account and/or Flexible Spending Plans are often offered through an employer, although they can be offered independently.  These accounts generally have a statute of limitations on when the money can be used.

Many accounts run on a calendar year.  Money left in the account is lost (you can no longer use it, even if you contributed it) and could affect you when filing your taxes.  Take time this fall to make sure your specific spending account is used wisely.

To Do:

  • Check with your employer or account representative for your specific account rules. Ask about contributions and unused monies in specific private or group plans, like health savings accounts.  Also, ask for a complete list of what you can purchase under your account.  You might be surprised to find that your account can cover child care, general purchases like boxes of kids’ bandages and other first aid staples, and specific purchases like breast pumps.

  • Budget spending wisely. Consider the season you are about to enter and make sure you have all your appointments complete and medications purchased before the deadline for spending.

IRS Publications: If you are interested in further reading on the IRS rules for Health Savings and Flexible spending take a look at these publications:

Publication 969:  Health Savings Accounts and Other Tax-Favored Health Plans
Notice 2010-59 & Revenue Ruling 2010-23: Updates and Health Care Provisions

Retirement/Education Contributions

by ralph and jenny

If you have an Employer Retirement Account, Individual Retirement Account (IRA) or Education Savings Account (ESA) check and see when the last date for contributions are.

Depending on the specific account type the contribution date may differ.  However, a majority of accounts have a final contribution date of December 31. If you have an account that receives a deduction for contributions, it is to your benefit to make sure you have those in on time!

To Do:

  • Call your account provider and find out the final contribution date for the current tax year. Make sure you make yourself a note or write it on your calendar so you don’t miss.
  • Plan for your contributions.  Your contributions do not have to be made in a lump sum. It may be easier to spread your contributions out over the last 3-4 months of the year.

IRS Publications: If you are interested in further reading on the IRS guidelines for retirement and education contributions take a look at these publications:

Publication 590: Individual Retirement Arrangements
Publication 560: Retirement Plans for Small Business
Publication 970: Tax Benefits for Education

2011 Tax Year is Here!

Being a good steward of our finances also means spending our money to the best of our ability, not just saving it. Make sure that you are making wise spending and contribution choices by knowing just a little bit about our tax system!

It is never too early to start a file and begin collecting tax information!

Rachael has been previously employed in the financial field but is not currently a tax adviser.  Please contact your tax adviser for specific questions and guidelines.


Rachael shares financial tips from her kitchen table surrounded by her two active toddlers and  her husband.  God has called her from corporate life into His grace as an at-home wife!  She  shares about her passion for motherhood and life five days a week at To Be a Mom…

If you have a financial question or topic you would like us to discuss leave a  comment or send us an email!

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5 comments to Fall Means…Tax Time?

  • Micayla

    While money in FSAs is lost and the end of the year, money in HSAs remains in your account.

    Please correct this so no one spends money they could save for future expenses!

    [Reply]

    Michele Reply:

    @Micayla, Yes, very true! Thanks for catching that!
    Blessings,
    Michele

    [Reply]

  • @Micayla,

    Thanks for your post! For an HSA (as outlined by the IRS) you generally do not lose money. For other private plans set up and sponsored by a small business employer there may be different rules.

    :) Thanks for reading and have a great day!

    [Reply]

  • As a professional fundraiser – thank you for addressing the issue of charitable donations! Its so often forgotten. I often encourage people looking for somewhere to donate to think outside the box – what are you really passionate about? What is a change you’d like to see in the world? Chances are good you’ll find an organization or project that fits your passions perfectly! We all know about homeless shelters, soup kitchens, our churches and missionaries – think about literacy groups, crisis pregnancy centers, your local symphony or theatre, campus ministries… The possibilities really are endless!

    If you’re looking to donate to a new organization, get to know them a little bit before sending a check. If you’re interested or knowledgeable in financial issues, check out their tax records and their annual reports to make sure they’re fiscally responsible. If that isn’t your thing, check out their website, visit the office, or make a phone call. Attend an event sponsored by the organization, or ask someone you trust if he or she is familiar with the organization. Consider getting involved as a volunteer to see how things work on the inside.

    When you make a donation, be sure that you’re truly investing in a cause that matters to you and in an organization that will use your donations wisely.

    [Reply]

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