End of Year Tax Tips

WORCESTER, MA

It's that time of the year; no, we aren't talking about holiday
shopping or gift giving guides...it's time to put those last minute
tax strategies into place before the end of the year. Act now and
chances are you will have just enough time to implement these money
saving tips:

1. Transfer Assets: Have a high income with a stay-at-home spouse?
Talk to your accountant about transferring income-producing assets
into their name instead of yours. For example, if you currently own
investment properties worth $500,000 which produce an income of 5
percent or $25,000 annually you could be hit with a tax bill of up to
$12,500 for high income earners. On the other hand, by transferring
these to your spouse, it may be possible to save half or more in taxes
alone.

2. Buy Now - Sell Later: High net worth individuals may find it
beneficial to close on short sale property prior to the end of the
year and/or hold of selling until the beginning of 2010 in order to
reduce 2009 taxes. Likewise, purchase supplies and materials needed to
renovate or sell a property as well as office equipment before the end
of the year.

3. Pay Property Taxes & Insurance Early: Strategically time the
payment of property taxes and insurance to get maximum impact; most
locations allow property taxes to be paid between November and
April...by delaying payment or paying early, it is often possible to
show two payments in one year thereby offsetting a high income year.
Just remember, should you exercise this option you will not have any
deduction the following year. However, it's a great way to help reduce
high income years for short sale investors that have several
properties under contract.

4. Make Contributions: Don't forget to make pension contributions
prior to the end of the year. If you've had an especially good year be
sure to maximize contributions.

5. Donate to Charity: Rather than tossing away building supplies, old
office equipment and even personal belongings put them to good use by
donating to charity. Not only will it help others in need but can also
help offset taxes.

6. Take Write-Off's & Make Large Gifts Now: If you intend to help
family or friends with the purchase of a large item or cash gift, do
it sooner rather than later. Under the current guidelines, you can
give up to $12,000 tax free to any individual making it a great way to
distribute assets rather than leaving it for estate taxes. Remember,
even debt forgiveness has tax consequences. Be sure to document
everything.

7. Review Family Trusts: Depending upon your individual circumstances,
family trusts make great financial sense but be sure to review them
annually to determine when to begin drawing down benefits or make
further contributions.

8. Take a Loss: Many short sale investors have had a very profitable
year but nearly everyone has at least one under-performing investment
lingering around their portfolio. Whether it's a cherished stock
you've been holding or dismal bonds of some near bankrupt company -
offset taxes by taking a loss now.

9. Verify Tax Credits: First-time homeowners aren't the only people
who may qualify for some form of tax credit so be sure to check.
College expenses, continuing education courses, new car purchase and
even energy efficient upgrades are just a few of the potential tax
credits that may be of interest to short sale investors.

10. Begin Planning for 2010: The last thing you want to think about is
next year's taxes but it's never too early to get organized. In fact,
that new PDA, NeatReceipt Scanner and other helpful gadgets may just
qualify for additional write-offs!

Adam Pasquale