"Get the face lift right away, but put off the wedding until January."
People used to get advice like that from palm-readers, astrologers or the person who cut their hair. Today it could just as easily come from a tax accountant.That number-crunching counsel has a special immediacy at the moment, with an income-tax year about to end and a set of new rules, passed by Congress a few weeks ago, ready to take effect in 1991.
Any financial adviser with a reasonable sense of perspective will hasten to acknowledge that man, or woman, does not live by calculator computations alone.
Still, experts on these matters say, if there aren't any other overriding factors involved, some judicious tax timing right now on matters ranging from cosmetic surgery to marriage or divorce can make a significant dollars-and-cents difference.
Consider the common tummy tuck, hair electrolysis or any other procedure designed to improve one's appearance.
The cost of cosmetic surgery has heretofore been eligible for inclusion in the list of medical expenses that may qualify for a tax deduction, if the total exceeds 7.5 percent of your adjusted gross income.
But starting Jan. 1, that will no longer be the case. The Revenue Reconciliation Act of 1990 decrees that costs of cosmetic surgery will no longer be deductible except in cases arising from injury, disease or congenital defect.
What's more, note the professional tax-watchers at the New York firm of Matthew Bender & Co., if you get reimbursed for non-deductible surgery expenses by a health insurance plan at work, the money paid is "not excludable from gross income." In other words, it could result in a bigger tax bill.
The logical response to all this, as summarized by another tax reporting firm, the Research Institute of America: "Consider having the surgery done in '90 if the expenditure will yield a '90 deduction."
The "think taxes first" message also applies to a couple who are mapping plans for a wedding or a divorce around New Year's.
Schedule the nuptials or the official divorce date for the right side of midnight Dec. 31, tax experts advise, and maybe you can use the tax savings to pay for a chunk of the honeymoon.
"A taxpayer's marital status for the entire year is determined as of Dec. 31," the Research Institute of America points out. "If he gets married (or divorced) on that date he will be treated as if he were married (or single) all year long."
Because of various quirks in the tax system, money owed to Uncle Sam can vary substantially with marital status.
To illustrate, the RIA cited the example of two people making $50,000 each. Filing jointly as a married couple, the firm reckoned, they would owe about $1,625 more in federal income taxes than they would as separate, single filers.
But if one half of the couple has a large income and the other a relatively small one, the effect can be reversed, giving a savings of a few hundred dollars to the marrieds.
Therefore, says the accounting firm of Ernst & Young, a couple with approximately equal incomes might opt for a January marriage or a December divorce; a couple with a big difference in incomes might be better off choosing marriage in the old year or divorce in the new.
Some years ago, the existence of the "marriage penalty" gave rise to an especially exotic tax dodge: To save on taxes, a couple could theoretically divorce each December and remarry in January.
That trick won't work now, the Internal Revenue Service asserts. People who get a temporary "tax divorce" will be required to file as a married couple anyway.