Cool & Simple Year-End Tax Tip

Here's a simple tax tip that will save you money if you have a mortgage on your home.

I'm betting your next mortgage payment is due Jan 1st, 2009. That mortgage payment is made up of interest and principal. I just checked my mortgage statement and interest is approximately $275 of my next payment.

If I make my payment a few days before Jan 1st and the bank posts my payment on or before December 31st. I'll get to take the interest off as part of my 2008 taxes. So paying January's payment a few days early will save me approximately $70 in tax assuming a 25% tax bracket. That's about three weeks of free gas in my tank. I'll take that.

So, if you itemize on your tax return, consider making your January payment in December. It's an easy way to put some money back into your pocket.