Whether it’s keeping tabs on holiday spending or thinking about our 2021 tax return, we all tend to be hyper-focused on our finances at this time of year. Here are three tax moves you should make now to prepare for 2022…
Be charitable: When purchasing Christmas gifts this year, don’t forget your favorite non-profits and charities. A sizable donation will be a nice deduction to your tax bill. Plus, you’ll be able to help out your favorite charity at Christmas time, and that’ll make you feel good.
Max out your retirement: Maxing out your IRA or 401k is a great idea for two reasons. First, you’re boosting your nest egg, which will make you very happy when it comes time to retire. The second reason is that you’re lowering your amount of taxable income, and that will save money on taxes this year.
Know your FSA rules: Under the current rules for flexible spending accounts, you won’t necessarily lose your FSA balance at the end of the year. But, it’s important you know the rules for your company’s FSA plan. You may have one of two options with your FSA: A “roll over” of up to $550 into the next year’s account or a 2.5 month grace period. Find out if your company provides one of these two deadline extensions before it’s too late.