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Helpful tax tips for the new year

Posted: 8:18 AM, Jan 14, 2016
Updated: 2016-01-14 08:18:33-05

Here's a dose of reality - now is the time to start planning for your taxes.

"January is a good time to start thinking for the New Year and understanding your situation," says the Tax Director for Plante Moran in East Lansing Kurt Beck.

The experts at Plante Moran say the New Year is the time for a new look at your 401(k).

"It's a good way to reduce your taxes while also saving for yourself," says Beck.

Some good news, the tax code hasn't changed much, so you won't have to deal with any major adjustments.

Plus, 2016 promises to be a good year for small businesses. Thanks to Congress, businesses can deduct up to half a million dollars on items like equipment.

Are you planning to buy a home or send a kid off to college? Significant life events like these could really change how you file your taxes.

"If you have a child that is going off to college," says Beck, "there's obviously a lot of added cost with that."

He says, make sure you're aware of what kind of impact those costs will have on your tax return.

Know your tax bracket, especially if you are a young person.

"You can make tax decisions based on what situation falls for you," says Beck, "and make sure you are aware of what deductions are available to you."

Another smart move, get a pin number from the IRS. If you file electronically, you will only be able to submit your taxes if you enter this pin number as well.

These pin numbers prevent a scammer from stealing your identity and filing a return for you. It's all about cutting down on fraud.

It all comes down to planning, the expert's big tax resolution for the year.