Table: Tax Tips: Making the Best of Bad Times
HARVEST YOUR LOSSES
Now might be a good time to dump that losing stock and write off the loss. In general, push income into next year, pull deductions into this one. Remember, your income will be taxed at a lower rate in coming years.
BEWARE THE ALTERNATIVE MINIMUM TAX
If you live in a high-tax state or have lots of long-term capital gains, you've just become more vulnerable to this shadow tax system.
CONVERT TO A ROTH
With your retirement portfolio down, you'll owe less tax when converting a traditional IRA to a tax-free Roth.
PUT OFF THOSE COLLEGE BILLS TILL NEXT YEAR
A short-lived deduction may let you write off $3,000 in tuition in 2002 and 2003, and $4,000 in 2004 and 2005.
SET UP A DONOR-ADVISED FUND
Need a big deduction? Here's a way to donate a lump sum for charity but have it doled out over time.