Tax moves to make in September 2016

How’s your first sort of full week of September going? The “sort of” question qualification comes, of course, because this week is short, at least for many workers, because Monday was Labor Day. September Bliss via HD Wallpapers Does anyone else find it intriguing that many of us celebrate a holiday commemorating work by taking the day off from our jobs? Even I, a self-employed person, took advantage of Labor Day to be lazy. But now it’s time to get back to the grind, even – especially – when it comes to taxes. Here are some things you might want to put on your tax to-do list for September. File your 2015 taxes: Some of us still have to take care of our 2015 taxes. Yes, my use of “us” means I still haven’t filed my tax return for last year. And while technically the extended filing deadline isn’t until Oct. 17 (the 15th is on a Saturday), I am going to get that sucker done before then! If you’re procrastinating along with me, you might want to consider not waiting until the ultimate deadline either. My motivation is simply to get that freakin’ frackin’ paperwork out of the way. But there are other reasons, three to be exact, as to why you should file your extended tax return before the ultimate deadline. Don’t miss the estimated taxes deadline: While the October extension due date is out there on the tax horizon, there’s a firm tax deadline in September, too. The 15th of this month is when the Internal Revenue Service expects to receive taxpayers’ third estimated tax payments for the current tax year. If you’ve already been making estimated tax payments for 2016, as detailed in the table below, then you know what you need to pay this September. Payment # Due Date* For income received in 1 April 15 Jan. 1 through March 31 2 June 15 April 1 through May 31 3 Sept. 15 June 1 through Aug. 31 4 Jan. 15 of the next year Sept. 1 through Dec. 31 *If the 15th is on weekend or federal holiday, the estimated payment is due the next business day. But if you just now realized you need to pay estimated taxes because, for example, you got paid for that freelance side job you took to earn some extra cash, get to figuring your estimated tax liability now and get your payment in by Sept. 15. Whether it’s your first one of the year – you must start making the 1040-ES payments whenever in the year you get compensation that doesn’t include withholding – or your third, don’t miss the deadline. If you do, you’ll get whacked with a late- or non-payment penalty. Do your education tax breaks homework: September also is one of the most-anticipated months by parents. It’s when the kids, finally, are back in school! If your children are in college, there are many tax-saving ways to pay at least some higher education costs. One of the most popular is the American Opportunity Tax Credit, which now is a permanent part of the tax code. This credit might be able to get you a bit of a tax refund and it even covers the cost of textbooks. If your youngsters are still in elementary or secondary school, make sure you’re saving for their college years. The tax code can help here, too, with two tax-favored saving options. You can put money into a 529 plan, where the investment grows tax-free. Then when the chips off the old blocks are at State U, you can tap the plan at no tax cost to pay certain university expenses. You also can open a Coverdell Education Savings Account. This plan is more limited in how much you can contribute, but more flexible in how to spend the school-related money. Coverdell funds, for example, can be used to pay for computers that your children need for classwork well before they head off to college. More monthly moves: Those are just three tax things to think about this month. You can find more tax strategies in the September Tax Moves list over in the right column, just under the digital clock counting down to the October extended filing deadline. Some are easy, like giving to your favorite charity. Others take more planning, like making sure you’re ready for the possible tropical storms that tend to reach their peak this month. And some won’t apply to your personal tax situation at all. But check them out just in case. The September Tax Moves that do fit your financial and tax needs could save you some tax dollars or at least keep you out of tax trouble.

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Tax moves to make in September 2016