Steps you can take now to cut your 2012 tax bill / It's not too late to put money in an IRA, organize your records and make sure you're claiming all the deductions you can. But don't wait until April 15.

Kelley Holland for CNBC/MSN Money writes:  April 15 is right around the corner -- and that means the tax man cometh.  If you are among the millions of Americans who file tax returns later in the game -- perhaps you've been busy getting that root canal -- it's time to start looking for moves you can make to reduce your tax bill.

"Once December 31 comes and goes, there are not a lot of action items" to save on taxes, says Jackie Perlman, principal tax analyst at the Tax Institute at H&R Block. "But there are some things to consider."


For starters, take a look at your retirement accounts. If you are an employee, IRS rules allow you to put away $17,000 per year in a 401k account for 2012 at any time up to April 15. (If you're over age 50, you can increase that amount to $22,500.) As soon as you put money in that account, any gains are tax deferred, and the contribution comes off your income for the year. You can also put away money in your individual retirement account.

Self-employed workers can cut their tax bills using SEP retirement accounts. "You get a current tax deduction and save for your retirement," says Mackey McNeill, a CPA and personal finance specialist who is also president and CEO of Mackey Advisors Wealth Advocates.
McNeill says she tells self-employed clients to put away at least 30% of their gross income so they can fund things like retirement accounts. Not saving regularly "is the number one reason people don't take advantage of their tax deductions," she says.

For taxpayers with eligible high-deductible health plans, contributions to a health savings account, or HSA, are another last-minute option. For 2012, it's possible to put in as much as $6,250 for a family plan and $3,100 for an individual.


When "the money goes in, you get a tax deduction for it," says McNeill. "If you use it for health expenses later, it's never taxable to you at all. The money can grow the same as in a 401k, or you can treat it as a money-market slush fund for health care expenses," she says.

Casualty losses are another opportunity for reducing your tax bill. If you suffered losses from Hurricane Sandy -- or any loss in a federal disaster area -- you can claim that on either your 2012 or your 2011 return. Only you know which year will net you more savings. This year the IRS is giving you until Oct. 15 to figure it out, even if you don't file an extension on your 2012 taxes.

McNeill points out that parents who are unmarried or divorced may be able to benefit from careful attention to their child deduction. "Sometimes people just assume one person is going to take the child deduction," she says. But the higher earner will actually receive less of a tax break from the deduction than the low-income spouse. If the plan is to share the savings equally, she says, "be really careful and run the numbers both ways."


Whatever your tax circumstances, financial advisers suggest you stay organized. If your idea of record keeping consists of stashing receipts in a paper bag all year and hoping for the best in tax season, you'll likely miss opportunities for savings. Many attractive deductions only become apparent when you sort through your records, according Perlman. "If you're doing your return on April 15 at three in the afternoon, that's a lot harder," she says.

Perlman says that if you go through your records and tally up your deductions, you may find that itemizing is a better bet than taking the standard deduction, even if you don't pay property taxes or mortgage interest. "You need to test it," she says. "If you're paying a lot of state taxes, it can put you over the standard deduction." So can significant charitable contributions, for that matter.

In addition to finding tax savings, you may be able to save on taxes by avoiding what Perlman calls "a huge tax mess." If you turned 70.5 years old in 2012, you are required to take your first minimum distribution from your retirement account by April 1. If you don't, she says, the penalties are steep.

Even for accountants, tax season is no fun. But with a little planning and attention to detail, it can be a lot less painful.