Generally, financial planners recommend basing investment decisions on your needs and on the economics of the investments themselves, not on taxes. However, if you've already sold off some winners this year, you could offset some of that gain by selling off, before the year's out, those losers you've been meaning to sell, anyway. Make charitable plans now, such as donating stock or mutual fund shares. Determine from your 1999 tax return what marginal tax bracket you're in. That's the rate at which your last dollar of taxable income is taxed.
Marginal rates are important when making investment and other financial decisions.
The rate also helps you determine the tax benefits of charitable contributions and other deductions, as well as employee benefits such as retirement plans and flexible spending accounts. Review with your tax advisor any significant changes in your life this year, such as marriage or divorce, the birth of a child, or a death in the family. All these can have major tax consequences. Reviewing them now gives you time before the year is out to make appropriate plans. The planning door closes December 31, 2000.