As the end of the year approaches, many people are scurrying
to make year-end tax moves to minimize their bills in the coming
tax season. But a lot of the advice taxpayers receive will be
useless if they don't know about a key decision they'll have to
make when filing their returns next year.
In the following video, Dan Caplinger, The Motley Fool's
director of investment planning, looks at the key decision of
whether to itemize deductions or take a standard deduction on
your return. Dan notes that most year-end advice hinges on
reducing your taxable income, with suggestions that include
making gifts to charity, paying state and local taxes early, and
prepaying medical expenses and other deductible costs. But as Dan
points out, most of these deductions are only allowable if you
itemize, making them essentially worthless if you take a standard
deduction. Dan concludes by going through the 2013 standard
deductions of $6,100 for single filers and $12,200 for married
couples and running the numbers to help you make the decision
about when you should itemize.
Know your taxes for 2014
Being smart about itemizing or taking the standard deduction is
just one way you can cut your tax bill to Uncle Sam. In our
brand-new special report "
How You Can Fight Back Against Higher Taxes
How You Can Fight Back Against Higher Taxes," The Motley Fool's
tax experts run through what to watch out for in doing your tax
planning this year. With its concrete advice on how to cut
taxes for decades to come, you won't want to miss out.
Click here to get your copy today -- it's absolutely free.
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