13 smart year-end tax moves
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If you have your heart set on a Toyota hybrid, half a credit could still help cut your tax bill. If instead you're just looking for any tax break from a more environmentally friendly auto, you can also choose from credit-worthy hybrids built by Honda, Ford or General Motors. In total, there are more than two dozen eligible vehicles from the four manufacturers. Drive one off the lot by Dec. 31, and claim the credit on your 2006 return.

6. Flex your spending account muscle
Do you have a flexible spending account at your job? Does it still have money in it? Does your benefit year operate on a calendar basis? If you answered "yes" to all of these questions, then you're running out of time to maximize this valuable fringe benefit.

Flexible spending accounts allow workers to put away pretax cash to help pay out-of-pocket child or dependent care expenses or uncovered health costs. Not only can these accounts help you meet extra costs, the account contributions are taken out of your paycheck before taxes are calculated.

These accounts are particularly beneficial when you can use them to pay for medical expenses that don't add up to the percentage-of-income threshold (more on this coming up in the next tip. You also can spend account money on over-the-counter medications.

But there's a downside. In most cases, if you don't use your account money in the benefit year that it's contributed, it can't be carried over to the next year. While your eventual tax bill won't be affected if you don't spend all your flexible account money by the end of this (or your benefit) year, failure to do so means you'll waste this tax-advantaged option, not to mention your hard-earned money. So don't lose it, use it!

7. Maximize medical deductions
If you don't have a flexible spending account, some of your medical costs still could reduce your tax bill as long as you get the treatments by Dec. 31.

The key to lowering your tax bill by deducting itemized medical and dental expenses is to have enough of them. IRS rules say you can't count these costs unless they exceed 7.5 percent of your adjusted gross income. If you make $50,000, that means you get no tax benefit until your medical costs exceed $3,750.

You still have time to reach the earnings cutoff. If you've been putting off that elective surgery and can afford it, schedule the procedure before the year's end to bump up your medical bills to the deductibility threshold. You can include any dependent's medical treatment, as well as the installation costs of special, doctor-prescribed therapeutic equipment or medically necessary improvements to your home. And if you must travel for medical treatment, you can deduct the drive at 18 cents per mile for any trips this month (or the previous 11), along with any parking and toll cost you paid along the way.