As the 2015 tax year winds down, there is still time left to plan and prepare any last expenses and deductions to help you save money on taxes. The key for taking these deductions is to keep accurate and detailed records. Business and personal deductions, as well as exemptions and tax credits, are all significant items to consider for year-end planning. Here are a few reminders that will help minimize tax liability for your business and personal benefit.

1. Take Note of the Deduction Allowance Limit

The issue at large for most businesses in 2015 is the status of Section 179. This tax provision allows for a greater deduction on assets purchased and placed in service during the year. The higher expense limit of $500,000 under Section 179 expired at the end of 2014. This currently leaves the Section 179 deduction for 2015 at $25,000.  Meaning, you may immediately expense, instead of capitalize and depreciate over time, the cost of assets placed in service during the tax year, up to $25,000. However, Congress will likely increase the higher Section 179 expense limit effective for the 2015 tax year, which would raise the Section 179 deduction back to $500,000.

Also Read: A Common Tax Misconception

2. Perform Truck Maintenance Before December 31, 2015

Some expenses for truck improvements and repairs are eligible for a tax deduction. Should the expense fall under or around the amount of $500 for an item, the business may claim the purchase as a deduction under a safe-harbor tax election. To add to business deductions and further reduce tax liability, perform repairs and preventative maintenance on your truck before December 31, 2015. Remember, document and save invoices/receipts for all business expenses, and send them to ATBS before your taxes are prepared.

3. Keep Track of Personal Tax Deductible Expenses

Track and detail personal expenses (itemized deductions) to further reduce tax your liability. Medical and dental expenses, home mortgage interest, property taxes, charitable contributions, tax preparation fees, unreimbursed employee expenses (for company drivers), and losses of property are all itemized deductions. However, only medical and dental expenses above 10% (7.5% for individuals or households 65 years of age or older) of adjusted gross income are deductible. Should total medical and dental expenses be at or near the 10% threshold, it may be beneficial to plan final doctor visits and medical purchases before the end of the year. Unreimbursed employee expenses and tax preparation fees are also bound to a deductible threshold amount (above 2% of adjusted gross income).

Also Read: Tips to Start Planning Next Years Tax Return

4. Claim Dependent Deductions and Education Credits

Lastly, claim all personal tax exemptions and credits available. Dependent exemptions and education credits provide significant tax benefit. There is a $4,000 dependency exemption for qualifying children (under 19 or a full-time student under 24) given more than half of their living support. As to education credits, there are two options for parents of students: the American Opportunity Tax Credit (AOTC) and the Lifetime Learning Credit. The AOTC offers the maximum credit of $2,500 for students enrolled at least half-time in a degree program (limited to the first four years of higher-education). The more available Lifetime Learning Credit allows a credit up to $2,000 per household with a student enrolled in at least one education course.

If future tax-liability is a concern, perhaps convert funds into a traditional IRA to a Roth IRA. Although conversion from a traditional IRA to a Roth IRA requires taxes paid for the year of conversion, the choice may dole out rewards at a later date in the form of tax-free distributions.

As always, if you have any tax questions as to the qualification of an expense deduction, exemption or tax credit, please ask your business consultant or tax consultant. We are always happy to help!

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