8 smart year-end tax moves
6. Harvest investment gains
This move stands traditional year-end tax advice on its head. Rather than deferring taxable gains until next year, clients in a variety of tax brackets may want to cash in gains in 2012. It’s the last chance for individuals with taxable income up to $35,350 or married couples with taxable income up to $70,700 to claim a 0% tax rate for profits on investments owned for more than one year. High-income clients may also want to harvest long-term gains at this year’s top 15% capital gains rate. It’s likely to increase to 23.8% next year and taxes on dividends could jump to a whopping 43.4%.