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Debra Daniels

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End-of-year tax planning: How to maximize tax credits now

The end of the year is fast approaching, but there is still time to do year-end tax planning to reduce an individual tax liability for 2011. Arizona offers several tax credits that redirect money to local, charitable organizations, reducing the amount of taxes paid in April. The maximum amount a person filing single, married filing separately or head of household can put toward the Working Poor Credit is $200, with married filing jointly, $400. Taxpayers need to itemize deductions on their Arizona income tax return, but not on their federal return. It’s always a good idea to calculate medical expenses, medical insurance premiums (including Medicare premiums), state income taxes withheld, property taxes paid, mortgage interest and miscellaneous deductions for Arizona income tax purposes because itemized deductions are not subject to the same limits as the federal income tax return.

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