5 Smart Tax-Saving Moves to Make Before January 1
If you want to shrink your tax bill for the year as much as possible, then now is the time to take action. Wait until next April (or even January), and it'll be too late to make any of these smart tax-busting moves.
Choosing whether to itemize your deductions or take the standard deduction is probably the single most important decision you'll make regarding your tax return. If you don't even consider itemizing your deductions, you could miss out on thousands of dollars in tax breaks. On the other hand, taking itemized deductions when the standard deduction would be bigger is just plain silly.
Most taxpayers can get a sense of whether or not itemizing is a good idea just by looking at a few of the bigger deductions. For example, if you're making payments on a mortgage that you took out just a few years ago, then the mortgage interest deduction will probably make itemizing worthwhile all by itself (during the first few years, mortgage loans have the highest percentage of the payment going toward interest that they'll ever have, so you're most likely to have a substantial deduction). Other potentially large itemized deductions include the charitable contribution deduction, the medical expense deduction, and the state and local taxes deduction.
Source: Fool.com