Year-end tax planning is especially challenging this year because of uncertainty over whether Congress will enact sweeping tax reform that could have a major impact in 2012 and beyond. Regardless of what Congress does late this year or early the next, there are solid tax savings to be realized by taking advantage of four tax breaks that are on the books for 2011 but may be gone next year unless they are extended by Congress:
- Option to deduct state and local sales and use taxes instead of state and local income taxes.
- The above the line deduction for qualified higher education expenses.
- Tax free distributions by those age 70 ½ or older for charitable purposes.
- Small energy credit still available.
Click on the above links to learn about the deduction, who it applies to, the benefit, and what you can do if it applies to you. If you feel these situations may apply to you, post a comment below or contact our Tax Planning & Preparation Group to review your individual tax position.