A personal finance to-do list for the year’s end

Claudia Buck / The Sacramento Bee /


Published Dec 27, 2012 at 04:00AM / Updated Nov 19, 2013 at 12:31AM

As the calendar ticks toward Dec. 31, here are some last-minute, year-end tips recommended by financial professionals:

Do your donations: If you want a charitable deduction on this year’s taxes, you need to write that donation check by Dec. 31. Donations made on a credit card by Dec. 31 are deductible for 2012, even if you pay the Visa bill in 2013, the Internal Revenue Service says. Gifts to individuals, however, are not deductible.

Max out the 401(k): If you haven’t maxed out the annual contribution to your 401(k) at work, do so now. For 2012, the annual contribution limit is $17,000; next year, the annual limit goes up to $17,500. If you’re over age 50, you can make an additional catch-up contribution this year of $5,500.

Ditto for your IRA: To boost your retirement savings, don’t forget your IRA contributions. In 2012, the maximum contribution to IRAs and Roth IRAs is the smaller of $5,000 or your taxable compensation for the year. For those age 50 or older, the limit is $6,000.

If you’re not covered by a retirement plan at work, you can get a full tax deduction for IRA contributions. If covered by an employer’s retirement plan, you can take a deduction up to certain income limits (i.e. no deduction is allowed for married couples filing jointly with incomes above $112,000).

Spend those FSA dollars: If you have a Flexible Spending Account at work to cover health/dependent care costs, now’s the time to make sure you’ve spent all those tax-free dollars you squirreled away. Since FSA accounts are use-it-or-lose-it, you don’t want to let that money slip away. And once you’ve spent those dollars, you’ll still need to file claims through your employer’s health plan to get reimbursed.

For dependent care (such as child care or adult day care), the deadline to incur expenses is Dec. 31. For health care expenses, many employers offer a grace period through the first part of 2013.

Prepare the paper: Now’s a good time to start gathering the paperwork for filing your 2012 taxes. Even if it’s simply tossing the paperwork into a shoebox, start collecting proof of income and proof of deductions/donations. Getting organized now can save you headaches down the road.