The looming fiscal cliff has been a constant reminder for millions of taxpayers that tax returns checks won't be as much as they were in the past.
"This could really create a lot of havoc. It already is going to, its just how much havoc is it going to create? That's the question," said Carlos Lopez, CEO of Lopez Tax Services.
Lopez said there are several changes expected to take place starting Tuesday. And while it may cause some headaches there is a small light at the end of tunnel.
Lopez said there are several things you can do to reduce your taxes before the new year.
First, maximize your 401K or IRA. "Look into your retirement planning to try to lock away a little extra if you can," said Lopez. He said this may be the ideal time to reduce your tax rate.
Another option, clean out your closet, garage and attic and donate what you don't need. Charity donations of over $250 can be a write off, and helps you increase your charitable contribution for 2012, that will help decrease your tax rate. Remember to always keep the receipt of your donated item.
Thirdly, for anyone who owns a house, try and make an extra interest payment now. "If you can afford it, I know it's the holidays," said Lopez.
Lopez said capital gains will increase so if you own stock that has appreciated value this may be the year to sell it.
Bottom line: "Prepay any taxable expenses this year and make sure you keep receipts," said Lopez.
For any business owners planning on purchasing equipment, doing so before the end of the year, is ideal to get a higher write off. Right now, businesses are allowed to write off up to $500,000 but that is expected to go down substantially next year.
Also, if your employer requires you to have a cell phone or they require you to pay certain expenses, its a good idea to prepay some of those now.
Experts also say if you are in your first four years of undergraduate school, to pay your January tuition by the 31st.
Saturday, May 18 2013 11:14 PM EDT2013-05-19 03:14:07 GMT
BRIDGEPORT, CT -- Federal investigators are in Connecticut inspecting the scene of a commuter train crash. Officials said it could take days before the busy section of track reopens. During the FridayMore >>
Federal investigators are in Connecticut inspecting the scene of a commuter train crash. Officials said it could take days before the busy section of track reopens.More >>
Saturday, May 18 2013 11:08 PM EDT2013-05-19 03:08:19 GMT
DAMASCUS, VA -- According to the Associated Press, a car drove into a group of hikers at a parade in Damascus, a small Virginia town. Around 50 to 60 people were hurt, according to reports. No fatalitiesMore >>
According to the Associated Press, a car drove into a group of hikers at a parade in Damascus, a small Virginia town.More >>
Saturday, May 18 2013 9:08 PM EDT2013-05-19 01:08:42 GMT
SANTA MARIA, Calif. -- The 4-H kids program trains future leaders in agriculture and community service across the Santa Barbara County but it is in danger of being cut altogether. The 4H program receivesMore >>
The 4H program receives $143,000 from the county which is scheduled to decide if it will continue or cut the funding this June 10th.More >>
Saturday, May 18 2013 9:06 PM EDT2013-05-19 01:06:55 GMT
PISMO BEACH, Calif. -- Some like to show off vintage cars while others in Pismo Beach like to show off vintage trailers. The Pismo Beach community got a blast from the past as more than 300 vintage trailersMore >>
The Pismo Beach community got a blast from the past as more than 300 vintage trailers rolled through Pismo Coast Village this weekend. More >>
Saturday, May 18 2013 11:15 AM EDT2013-05-18 15:15:59 GMT
LOMPOC, Calif. - The Lompoc Fire Department held its lottery on Friday morning for local groups to sell "safe and sane" fireworks for its upcoming Fourth of July celebration. Fire officials held a blindMore >>
LOMPOC, Calif. - The Lompoc Fire Department held its lottery on Friday morning for local groups to sell "safe and sane" fireworks for its upcoming Fourth of July celebration.More >>