MONEY SAVING TAX STRATEGIES
- Teddy Fragoso
- Jun 22, 2022
- 2 min read
Updated: Jun 28, 2023
Filing your annual income taxes doesn't have to be a daunting, tedious, or
overwhelming task. The following strategies will help you save money when
you file your taxes.
File electronically. Filing electronically will translate into a fast refund with the possibility of fewer errors. Even if you go with a tax preparer, you can still e-file. You can file online for free through the IRS or you can file through a software solution like TurboTax, TaxCut, or TaxAct.
Prepare for retirement. Verse yourself on the IRA limits for retirement, and make sure that you put away the maximum amount toward your retirement before the end of the year. You may qualify for a deduction depending on your income, meaning that funding your IRA may lower your tax bill.
Consider child rearing credits. Child care credits, dependent care credits, and child tax credits all translate into tax savings as long as your children meet the qualifications. For the child tax credit, the child must be under the age of 17 and for dependent-care and child-care, the child must be under the age of 13.
Be a student. Students can deduct as much as $4,000 in fees and tuition for school. There are specific income requirements to consider, however, so talk to your tax preparer to find out if you qualify. Hope Credits and Lifetime Learning Credits are also available, offering valuable tax breaks annually for students.
Profit from self improvement. When qualified medical costs exceed 7.5% of your adjusted gross income, such as classes to stop smoking or weight loss programs prescribed by a doctor, then these medical costs are deductible. Other deductible expenses include braces, chiropractic care, acupuncture, and eyeglasses.
Profit from home improvement. Green and eco-friendly home improvements can also mean tax savings. Check with your tax preparer to find out if any of your recent home improvements qualify for these tax credits. The most popular improvements include the removal of lead paint from your home, solar and wind technologies, improved insulation, weather stripping, and energy-efficient appliances.
Small Business Services, Tax Preparation & Services
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