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Extend your tax luck with these 13 year-end moves

Are you hunkered down at home today, hiding out until Friday the 13th passes?

Friday the 13th_black cat_PinterestYou are not alone in suffering from paraskevidekatriaphobia.

The number 13 has been considered an omen of bad luck for ages. One explanation is that 12 has historically represented the number of completeness; examples include the 12 months of the year, 12 gods of Olympus, 12 hours of the clock, 12 tribes of Israel, 12 Apostles of Jesus, and 12 Imams of Muhammad.

Thirteen, on the other hand, is seen as an outlier. However, I will happily take a specially priced Baker's Dozen of pastries on Friday or any day of the week!

As for Friday's unlucky connection, one theory is that it was on the last weekday that Jesus was crucified. Another explanation is that the connotation dates to Geoffrey Chaucer's 14th century work "The Canterbury Tales," in whose stories Friday is viewed as a day of misfortune and ill luck.

Whatever the source of the Friday the 13th superstition, it has endured.

13 lucky year-end tax moves: Another persistent part of our lives is taxes.

For many, taxes can be very unlucky. But there also are things you can do, especially by Dec. 31, to turn your tax luck around.

The following list of 10 year-end tax moves comes from my story, which also is the latest Weekly Tax Tip.

  1. Bunch your deductible expenses.
  2. Add to or open an IRA.
  3. Be generous to charities.
  4. Pay college costs early.
  5. Check your health insurance.
  6. Defer your income.
  7. Add to your 401(k).
  8. Review your flexible spending account (FSA) amount.
  9. Make the most of your home.
  10. Harvest tax losses.

Check out the article for more details on these potentially tax-saving steps to take before 2015 is history.

Rounding out the lucky list: And you are in tax luck this Friday.

Here are three more end-of-year moves to bring the list to a decidedly positive 13.

  1. Harvest capital gains.
    This is the reverse of harvesting your portfolio's losers. Here you sell stocks that have appreciated and that you've owned for more than a year. That way the taxes due are at the lower long-term capital gains rate. Then you buy the stocks back to reset your basis. That means when you sell the asset for good later after it has grown in value even more, the new purchase price will mean more basis, which translates to less taxable profit. And don't worry about wash sale penalties. That rule only applies to tax losses, not gains.
  2. Check the calendar before buying mutual fund shares.
    As long as we're talking investments and the end of the year, be careful about investing in a new mutual fund or adding to an existing one in December. Funds typically distribute dividends in the 12th month of the year. If you buy before this distribution date, you'll be hit with a tax bill for the payout. Check with the fund company as to when the distribution will be and buy after it.
  3. Directly donate your required IRA distribution.
    This option is for older retirement account holders, specifically those age 70½ or older. Once you hit that septuagenarian half-year mark, tax law demands you take a certain amount each year from your traditional IRA. The IRS has worksheets and tables to help you figure the amount, which is known as a required minimum distribution or RMD. Miss the withdrawal and you'll be hit with a stiff penalty. But what if you don't need the money? Then donate your RMD to your favorite charity. As long as you do so via a trustee-to-trustee direct transfer, you'll satisfy your RMD amount and the distribution won't count as taxable income to you.

There's one caveat about #13. That qualified charitable gift distribution option expired at the end of 2014.

The good news, though, is that it's likely to be back on the tax books for 2015 before this year's end. It's part of the extenders tax package, which the House and Senate tax-writing chairmen have both indicted they want to finish soon.

And even if the RMD rollover to charity somehow doesn't get renewed, you can use the direct gift from your IRA to your favorite qualified nonprofit as a deductible charitable donation.

Definitely odd: This Friday the 13th is a special one. It's also Odd Day.

That name comes from the numerical designation 11/13/15.

Today is the last time this century that we'll be able to display a calendar day as three consecutive odd numbers.

If you want to acknowledge the oddest time today, set your alarm for 21 seconds after 5:19 p.m. That moment can be written as 11/13/15 17:19:21, with 17 indicating 5 p.m. in military time.

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