My Personal Financial Cliff: Thoughts on Saving Money in 2012/2013

I am concerned about all the talk about higher taxes. Any suggestions?

I am assuming that you are or are about to be divorced and will be filing as single or head of household in 2013. Capital gains taxes are expected to increase next year. Therefore, if , as part of the divorce settlement, you will be required to sell the marital home,  try to sell in 2012.

Since you really only have a few weeks until year end, and the real estate market is notoriously slow between Thanksgiving and Christmas you can assume that your house will not sell until 2013. In that case, take as many capital gains as possible this year when a lower tax rate is still in effect. For instance, if you have a stock portfolio with a lot of gains consider stock sales to capture capital gains this year rather than the next. Additionally push charitable contributions into 2013 to offset gains.

Will you be receiving alimony!? Don’t forget alimony is considered income to the person receiving it and is deductible to the person giving it.

If you haven't legally divorced by year-end, you are married for tax purposes. That can lead to some strategizing for those whose divorces are nearing conclusion . While some people may want to just “get it done”, there may be financial benefits to waiting for the new year and filing jointly one last time.

All in all, in this uncertain tax climate, it might be advisable to seek counsel for an accountant. They are probably also up in the air about the future but one thing is for certain…taxes are going up!!!!