The end of the year is here and that means it's time to get those last minute tax deductions for 2002. Here are some tax tips from the Internal Revenue Service.
According to the IRS, there are a few simple ways to reduce the amount of taxes you have to pay this April.
The first tax savings tip---make donations. You can donate cash, cars, clothes or other items around the house to charities like goodwill that use your donations to help people in need. "So, that's job programs---that's life skills training for people." Melissa Lyby of Goodwill Industries in Colorado Springs says the last week of the year is their busiest time for donations. "We more than double what we see on a regular day."
You could also donate to your favorite church. In 1999, more than 35 million Americans made contributions. The total---nearly $126 billion.
A second type of deduction would be to sell stocks or other financial holdings at a loss. The only catch---you need have the proceeds in your possession by December 31st.
A third deduction would be to make extra mortgage payments---the extra interest is deductible. But you may come up short next year because you'd make fewer payments in 2003.
Remember, all deductions must be made during the 2002 tax year to qualify. But just like any major financial decision, before you start re-arranging your money matters, get advice from a tax professional.
You can also get more information by calling 1-800-TAX-FORM or checking out the IRS website: Internal Revenue Service