Still time for steps on taxes

If you've got nothing to do this afternoon, I'd suggest spending a few moments thinking about your taxes. Some preliminary calculations now would give you three days to make adjustments.

Here are some things to consider, courtesy of Norman Manley, a partner at BDO Seidman in Charlotte; H&R Block and the IRS:

* Contribute to or open a retirement plan to lower your taxable income. Most plans must exist by the end of the year but don't have to be funded until taxes are due. You can contribute up to $5,000 to IRAs until April 15. If you're 50 or older, throw in an additional $1,000 as a catch-up.

* If you bought your first house this year or are thinking of doing so, don't forget the tax credit -- $7,500, or 10 percent of the purchase price. Any home bought by July 1 is eligible for the credit, but only those bought before Thursday qualify for a credit on this year's return. After that, claim it on your 2009 return. Remember, this is essentially an interest-free loan from the feds. The second year after you claim it, you start paying it back over 15 years.

* If you received debt consolidation assistance from a third party this year and the amount you owe was reduced, that could end up as taxable income on your return. The exception? If you're insolvent.

* If it looks like you're going to owe this year, factor in some last-minute charitable donations. If you have little or no credit-card debt, consider charging the donation. It won't come due until January, but be sure to pay it in full.

* Likewise, go ahead and pay spring tuition if you have a child in college. The Hope credit is worth up to $1,800 per student for freshmen and sophomores. The Lifetime Learning credit is worth up to $2,000 for qualified higher education expenses.

* And while you're at it, pay your property tax bill, even if it's not due until January.

* Finally, a reminder to teachers: You can deduct up to $250 spent on class supplies. That deduction, which expired at the end of last year, has been reinstated for this year and 2009. And you don't have to itemize to take it.

READER SHOUT-OUT: Jim Shamp of Durham called the other day with a story he thought I'd like. Indeed, I liked it so much I'm giving it a "How Dumb Do They Think We Are?" award. (If you'd like to nominate a business for the award, drop me a line.)

Bank of America had sent him this offer: Buy three BOFA/American Express gift cards and get a $15 gas card for free.

Mr. Shamp read all the fine print -- how it worked, the conditions, etc. Everything looked good, so he decided, "Why not?"

Well, he found that out when he went to the bank. There was a $3.95 fee for each gift card.

I particularly like that the materials he received in the mail started with "If you're going to spend, spend smart."

Mr. Shamp did, deciding that the bank could keep its gift cards.

Manny Weintraub, a portfolio manager for Integre Advisors, often sends me -- and other newspaper editors -- e-mail. A recent one was "Ten Investment Resolutions for 2009." I liked No. 10, a reminder that "Wealth is relative." It included these wise words: "If you're down but not out, you're in pretty good shape."

As this very tough year ends, I hope you're in pretty good shape. Thanks for reading.