End-of-year finanicial 'to do' list

December 20, 2009 1:15:09 PM PST
Between the bustle of the holidays and a rapidly approaching finale to 2009, little time remains to act on some very important financial matters, actions that can help us hang on to more of our hard-earned money, but only if addressed prior to year's end.Since december is the time of year for lists, Joan Jensen, president and CEO of Central Credit Union of Illinois visits to share an important list that can help you save money and time and help provide a solid jump-start to organizing finances in 2010.

The Basics
After covering the basics, such as depleting all flexible spending funds (and filing for reimbursement), securing a free credit report from www.annualcreditreport.com, and creating a file or collection box for all tax- related documents, make the time to carry out these time and money-saving actions.

Donate (and deduct)
Don't know what to get that friend or family member who has everything? Consider a gift of money --small or large up to $13,000 for each recipient, or a donation of money, stock, IRA funds, household goods, or vehicles to a reputable charity. Don't forget to request and save receipts!

Reduce capital gains and maximize 2009 deductions
Sell off stock losers to offset any gains. Be sure check and see if you have any losses carrying forward from the 2008 return. Contact your mutual fund company or check its Web site to see if that fund plans on issuing year-end distributions. Maximize 401K and other IRA contributions. Prepay January 2010 mortgage and tuition payments.

Plan ahead
Confirm payroll deductions for such items as FICA, Medicare and state taxes are accurate, especially for those with multiple jobs or are married and planning on filing jointly.

Roll over 401k from previous job into an IRA
Prepare to convert to or open a Roth IRA. New regulations enable those converting to a Roth IRA in 2010 to spread tax liability hit out across 2011 and 2012, paying half the converted income in 2011 and the other half in 2012 at whatever tax bracket you're in during those years.


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