8 Smart moves to make by year end
These strategies will cut your taxes and prep you for the new year. But you have to act by Dec. 31.
By George Mannes, Money Magazine senior writer
Retirement
Get IRA smart
Are you (or a relative) older than 70 1/2? Be sure to take the required minimum distribution from your IRA by Dec. 31 (April 1 if you turned 70½ in 2006). Otherwise you'll get walloped by a 50% tax on the money you should have pulled out but didn't.
"It is astonishing how many people miss the deadline," says Jay Hutchins, a certified financial planner in Lebanon, N.H. And here's a new option: In both 2006 and 2007, you can donate up to $100,000 directly to charity from your IRA, by-passing the usual taxes on withdrawals - and the gift counts toward your required distribution.
Move quickly, though: The gifting deadline is Dec. 31. And because of the extra paperwork and logistics involved, some IRA administrators are setting deadlines earlier in December.
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