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3 shrewd year-end tax moves

By Kemberley Washington · Bankrate.com
Thursday, December 19, 2013
Posted: 4 pm ET

Another year is almost over, but that doesn't mean making the right choices for your finances ends now. Before Dec. 31 approaches, take time to reduce your 2013 taxes.

Here are three smart year-end tax moves.

Homeowners

If you own your home, consider making the January mortgage payment or prepaying your property taxes by Dec. 31.  Making these extra payments before the year ends will allow you to deduct additional expenses and reduce your tax liability.

If you are in the market for energy-efficient appliances, consider purchasing these items now. The current tax law allows individuals to take a deduction of up to $500 for the purchase of some energy-efficient appliances.  However, this tax break is set to expire at the end of the year.

Teachers and students

Whether you are a student or teacher, take advantage of specific write-offs before year's end. Kindergarten through 12th-grade teachers are eligible to deduct up to $250 for supplies purchased for their classrooms.

College students and parents of those in college should take time now to pay college tuition and fees.  Currently, the law allows a tax break of up to $4,000 for tuition and fees.  However, both the teacher deduction and tuition and fees are scheduled to expire at the end of 2013.

Business owners

Lastly, if you have equipment needs for your business, make your purchases now. The current bonus depreciation tax deduction allows business owners to deduct up to $500,000 for equipment purchased and placed into service before the end of the year. However, this depreciation deduction will reduce to a fraction of the amount -- $25,000 -- for 2014.

Kemberley Washington is a certified public accountant and professor at Dillard University in New Orleans. Follow her on Twitter.

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