3 Tax Moves to Make by Dec. 31
Thanksgiving is almost here, and before you know it, it'll be time to start planning parties for New Year's Eve. But on top of holiday shopping, planning family trips, and everything else that comes with the holiday season, it's important to get a handle on your tax planning before December ends.
In particular, there are a few things that absolutely have to get done by Dec. 31. If you don't, you could miss out on valuable tax breaks or even face even more unexpected surprises. Below, you'll find three tax-related moves to get done over the next several weeks.
Those who are 72 or older typically have to start taking money out of traditional IRAs, as well as from 401(k) or similar employer-sponsored retirement accounts. In addition, those who inherit IRAs and qualify to take annual withdrawals that stretch across their projected life expectancies also have minimum amounts that they have to withdraw every year. These mandatory withdrawals are known as required minimum distributions . Calculating the amount involves looking at the balance of your retirement accounts at the beginning of the year and applying a life expectancy factor to determine the fraction of the balance you have to withdraw.
Source Fool.com
