The last day of the year means so much more than simply planning a party to welcome in the New Year. December 31 is a barometer used by the IRS to measure a person’s existence – what you are on the last day is what you were for the entire year.

Let us start on a happy note; if you welcome a newborn into the world on the last day of the year, then you will have the personal exemption as if you had the child for the entire year. You will also be able to claim the child tax credit of up to $1,000. If you have twins and they split that magic hour and have different birthdays, only the child born on the 31st counts as a dependent.

On a mixed note, are you planning a marriage or divorce late in the year? Whatever your status is on December 31 is going to be what your filing status is when you do your taxes. These life-altering decisions will have major tax consequence because you may have been planning or receiving tax credits and now become ineligible or vice versa. If you get married late in the year, you have two choices on how to file. One is married filing jointly and the other is married filing separately. Single is no longer an option.

Each has its own set of ramifications and you should seek professional advice before hand, for the financial aspects not the marriage, of course.

If you are divorced then your options are single or head of household, if you have eligible dependents and meet the criteria.

How about income? The IRS considers individuals to be on a cash-basis, meaning that the day that you receive the money is when you have the income. Getting checks in December and holding them for deposit until January may not cut it in an audit. You should recognize the income when you receive the money.

If you are required to take money from an IRA, it must be out of the account by December 31. If you fail to take your Required Minimum Distribution then you face a penalty of 50 percent of the amount that you failed to take. I just finished working on a case where the client was facing a penalty of $31,000 due to not taking the money out for a few years. That is a lot of anxiety and money, but I did get the penalty abated. For your own safety, do not wait until the last minute and do it no later than Christmas to be safe,

Giving to charity? Usually it is the date of delivery that matters. If you are paying by check, that means the postmark on the envelope. If you are paying by credit card, it is the date of the transaction. From my own personal experience, when I have contributed by credit card, I would get an email acknowledgement and the credit card statement would have the proper date. Having said that, why wait until the last day. Remember for any transactions over $250 you will need a written acknowledgement from the charity with the proper verbiage.

If you are donating stock or other securities to a charity, remember that the process does take time and the date that the charity receives the stock is the applicable date. Work with your financial firm to make certain that you are aware of the processing deadlines.

Do you have capital losses? The date of the trade, not settlement, determines the applicable year. Any transactions made on December 31 are for the current year. You may exclude up to $3,000 dollars of capital losses against ordinary income and you can carry forward any excess losses to use in subsequent years.

If you are saving for your children’s education and contributing to either a Coverdell IRA or a 529 plan, the delivery date (postmark) determines the year that it effects.

There are certain tax credits that may expire in 2017 but as of now, the law is uncertain. The $7,500 tax credit for buying an electric vehicle may end this year. That is something that you may wish to consider taking advantage of while it is still available – if you are in the market for an electric car!

On the gloomiest note, if you die on December 31, then you have not earned that month’s social security or VA payment and the government will reclaim it if paid. Individual pensions have their own rules and regulations.