With December upon us, it is the perfect time for tax planning. If you have had a windfall, or a change in circumstances, it may be advantageous to see how it will affect your taxes. No one likes a surprise tax bill and the sooner you can plan, the easier it will be since you have time to come up with the money, or put it in your budget. Also, if you are in a situation to get a large refund, it would be wise to file as soon as you can to get your money.
Some tax savings can be attained even after the year end, but some things have to be done by December 31st. For example, some IRA contributions can be done up until April 16th, 2012 for the 2011 tax year. Certain self-employed retirement plans can also be done that way. However, if you are planning on increasing your itemized deductions through charitable contributions, or if you are planning on selling some stock at a loss, those have to be done by the end of the year.
Some ideas can take some time to implement so now is a great time to look at your tax situation and see if there are any tax savings to be had!