Year-end tax saving strategies / A sample of 2013 tax saving and deferral strategies available to you by acting prior to Dec. 31

Barry Dolowich for the Monterey Herald writes:  A s the end of another year rapidly approaches, it is important to review your tax position to insure that you take advantage of every possible tax saving tool. Remember, 2013 tax planning in January 2014 will be too late!

A sample of 2013 tax saving and deferral strategies available to you by acting prior to Dec. 31:

1. Capital gains can be offset by capital losses. Therefore, it is recommended that you review your investment transactions for the year to ascertain your capital gains position. If you have a net capital gain position to date, you may want to review your investment portfolio for a loss position to sell before Dec. 31 to offset your net capital gain. Likewise, you may want to sell appreciated securities to take advantage of a capital loss position. Do not forget the capital gain income you may receive through your mutual funds.

2. Mortgage interest is generally paid in arrears (we pay interest on the first of each month for the prior month's interest). Therefore, by accelerating the Jan. 1 mortgage payment by paying it in December, you will be able to deduct the December 2013 mortgage interest in 2013 instead of 2014. It is recommended that you make this payment by the middle of December to insure that your mortgagee receives and records the payment prior to Dec. 31 and that your Form 1098 agrees with the deduction on your tax return.

3. Charitable contributions, when possible, should be accelerated into December instead of waiting until January. This is the time you should be packaging your unwanted clothing and furnishings for pickup by your favorite charity. Make sure to get a detailed receipt and retain it for your tax return preparer.There also can be tremendous tax saving opportunities by donating appreciated property (stocks, bonds, real estate, etc.) to charitable organizations by deducting the fair market value of the gift without having to recognize the capital gain.

4. Other deductible expenses, such as medical expenses, medical insurance premiums, real estate taxes, state estimated tax payments, etc., should be reviewed for possible acceleration into 2013. Please note that lumping of medical expenses in the same year may help you exceed the 10 percent (7½ percent for those over 65) adjusted gross income limitation.

5. Deferral of income into 2014 can often be accomplished with a little planning. There are numerous situations in which you may be able to elect to delay the receipt of taxable income until January.

6. Real estate tax payments can be accelerated and deducted in 2013 by paying your 2013/2014 second-half bill due April 10, 2014 by Dec. 31, 2013 instead.

The above is just a sampling of simple strategies that can help you reduce your income tax liability. Prior to taking any of the actions detailed above, I recommend that you consult your tax adviser to determine if you may be subject to the Alternative Minimum Tax. In addition to tax savings planning, this is the time of the year that many taxpayers should consider a tax projection to minimize, or eliminate, potential underestimation penalties.