There is Still Time to Save on 2005 Taxes

Although 2005 is bound ambagious down, there is still time to crop advantage of these tax extenuative opportunities for 2005.

Woburn, MA November 30, 2005 –- “It's not too backward to cut your 2005 tax bill, afore December 31st,” assures Andrew Schwartz, architect of the MDTAXES Network, an amalgamation of CPAs throughout the country that specializes in tax planning and alertness for healthcare professionals.

Here’s how:

·Increase your 401(k) and 403(b) contributions if you haven't been accidental at the best amount all year. This year you can put up to $14,000 into your 401(k) or 403(b) plan at work. Anyone 50 or earlier by December 31 can accomplish added “catch-up” contributions of $4,000. Contributing to a 401(k) or 403(b) plan at plan is one of the best tax shelters accessible to you during your alive years.

·Set up a Solo 401(k) if you’re self-employed and accept no advisers who plan added than 1000 hours per year, except your spouse. With these tax advantaged retirement accounts, you can accord $14,000 additional 20% of your net self-employment income, up to $42,000 for 2005. If you are 50 or older, the max increases to $46,000.

·Take a attending at your denial and acquaint your employer to abstain added taxes if you haven’t had abundant taxes withheld during the year to abstain accepting hit with an underpayment penalty.

·Consider affairs your investments captivated in non-retirement accounts that accept decreased in amount back your basic losses can account added basic assets accomplished during the year (including from your alternate funds). Excess losses can again be acclimated to account up to $3,000 of accomplishment and added income. Make abiding to delay at atomic 31 canicule afore affairs aback a aegis awash at a loss, or the IRS will abjure the accident beneath the "wash sale" rules.

·Send in your January, 2006 mortgage transaction aboriginal abundant so it will be candy above-mentioned to 12/31/05. By sending in your transaction a few weeks early, you can abstract the absorption allocation of that transaction a abounding year earlier.

·Clean out your closets and accord your accouterment and domiciliary items to a accommodating organization, back "non-cash" contributions are deductible if you itemize. Don’t discount to get a receipt. For ability of money, authoritative your donation by acclaim agenda afore December 31st allows you to abstract the donation on this year's return, even if you don't pay your acclaim agenda bill until 2006. And you consistently accept the advantage of altruistic accepted investments to charities. You get to affirmation your donation based on the amount of the assets donated, after paying any basic assets taxes on the appreciation.

·Review your assorted itemized deductions. These items, such as unreimbursed agent business costs and investment fees, are deductible to the admeasurement they beat 2% of adapted gross assets (AGI). Items paid with acclaim cards are deductible in the year charged. Beware of the Alternative Minimum Tax (AMT), however.

·Pre-pay your projected accompaniment tax arrears if you'll be itemizing your deductions and not accountable to the AMT.

·Pay off your medical bills. Medical and dental costs are deductible if they beat 7.5% of your income. Payments for casework not yet performed are not deductible.

“Finally, you should appraise whether you'll save any taxes by apathetic 2005 assets or deductions into 2006 or by accelerating 2006 assets or deductions into 2005,” explains Schwartz.

Andrew D. Schwartz, CPA is the editor and a above contributor to www.MDTAXES.com, a website that provides assets tax and banking planning advice geared appear healthcare professionals. Yahoo! Internet Life annual chose MDTAXES.com as one of the seven capital sites for the adeptness do-it-yourself taxpayer. Schwartz has aswell appeared on CNBC's Money Club. He is accessible for interviews.