Tax cleaning

I am sure you have heard of spring cleaning, but tax cleaning?  Since it is the end of the year, it is time to do some tax cleaning.  You ready? Ok great, let’s start:

Portfolio investments

Begin cycling through your investment portfolio; if you have sustained losses on some of your investments sell them now. Don’t worry if you like the investment buy it back immediately with just a few clicks of the mouse. We want the loss for your tax return.


Go through your closets, basements, garages and other “storage” areas.  There are hidden deductions, I meant donations there I am sure. Search for useful things that you haven’t used in the last few months or forgot that you had. Donate those items to a tax exempt organization before the end of the year. Be sure to retrieve a receipt from the organization signifying your name, the date the item(s) were donated and a description of the item.  Be sure the organization is a charitable organization with its tax exemption currently in place.

Maybe you have some extra cash lying around, if so make a yearend contribution to your favorite charity.


If you owed money to the IRS or state you reside in over the past year or two, it maybe a good idea to increase your withholdings at work.  Do this by completing Form W-4 and submitting it to your employer immediately.  Be sure to claim one or two less exemptions that you originally did. Note: you want to do this soon as some employers don’t process W4 changes right away. You can change your W4 back to its original number of exemptions at the start of 2012.


If you are over 70 ½ years of age you are required to take a distribution from your IRA or employer sponsored plans.  Be sure to do this before December 31st. If you don’t take the distribution timely you will certainly pay a penalty for it.

Tax payments

If you pay estimated taxes during the year, make your January 2012 payment before Dec 31, 2011.  This will assist you in lower any potential tax burden in 2011.

You have some information to start with, now start cleaning! Speak with your tax advisor about how this information will impact you specifically. Tax planning is unique to the individual, his/her income and their overall financial health. If you don’t have a tax advisor then visit us at

Year Closing Tax Tips

As we approach the end of the year many people are thinking about the upcoming Christmas holiday, spending time with relatives and friends.  While that is good, we should also think about how we can lower our tax liability before December 31st arrives.  Here is a short laundry list of things that most of us can do:

Spring cleaning in December - Go through your closets and sort out items that you truly need and items that you do not need.  What you don't need give to charity but remember to itemize a list of what you are donating.  Also give the item a true value based on the age of the item and the wear the item has.  This might be a good time to go through rented storage space.

Rid yourself of under-performing securities - If you have securities that are losing money you might want to consider selling the securities in order to take the loss on the sale of stock.  Don't worry, if you don't want to get rid of the security you can always buy it right back at the lower price.

Charity - Consider making a year end gift to a charitable organization.  This will assist in meeting the need of others and give you a deduction all with one stroke of the pen.

These are just a few simple things that do not take a long time to do.  Take some time and save some tax dollars before 2010 is complete.

The Towles Group Inc can assist you further, give us a call at (516) 522-2676 or visit us at