Although many people equate saving taxes with finding tax deductions, 2 of the very best ways to save on your taxes can be found with your employer.

1.     Max out your retirement savings plans. If you haven't already hit the 2009 maximum of $16,500 in your 401(k) or similar retirement plans, you still have time.  Employees who will turn 50 in 2009 can contribute an extra $5,500 in “catch up” contributions.  If you are eligible for a year end bonus, consider putting all of it in your retirement plan.

2.     Use your employer’s flex account wisely.  You can save big tax dollars using your employer’s pre-tax flex plans to pay out-of-pocket medical costs and daycare costs, but be careful about leaving money in the account at year end.  Although some employers allow a grace period until March 15, 2010, many still have a “use it or lose it” provision which ends December 31^st.   Take a look at what you spent out of your flex plan for this year and and plan your flexible spending account contributions for next year.

3.     Go beyond your employer's retirement plan. Consider funding a Roth IRA if your married joint income is less then $176,000 ($120,000 for single filers).  You have until April 15, 2010 to make the 2009 eligible contribution.  However, the sooner you contribute, the sooner your money will start generating tax free earnings.  Don't wait!

4.     Contribute to a 529 College Savings Plan.  Put away college money for a child, grandchild, friend, or other relative.  The state of Iowa will give you a deduction for up to $2,800 off your 2009 Iowa taxable income per beneficiary for contributing to the College Savings Iowa plan.  For details, go to www.collegesavingsiowa.com

5.      Insulate!  Feel a draft?  Make your principal residence more energy efficient by December 31, 2009 and get tax credit of 30% of the cost (up to a maximum credit of $1,500 for 2009 and 2010).  Other energy improvements may also apply.  For details, go to http://www.energystar.gov/index.cfm?c=tax_credits.tx_index