With the vacations over, it’s now time to start preparing for taxes season. Being prepared can mean fewer headaches and potentially more savings when you file a return. The following are guidelines that can help you save money on your taxes. Software such as turbo tax also allows you to prepare and file taxes all in the comfort of your own home.
Save if you have children:
If you have children, your savings will be even greater. As a parent of children 17 and under, you can receive a $1,000 credit. You can also save money if your children are attending college. You may have to look into what credits apply for undergrad students as most credits have limited lifespans and are at times extended or replaced with other credit-based programs.
If you are itemizing and are making a donation, there are limits that apply to how much you may deduct. Charitable contribution deductions cannot exceed 50% of your adjusted gross income. Gross income is your total income including interest and dividends less certain items like IRA contributions and student loan interest. When you or your accountant completes your return, it will be calculated as part of the process.
Save money while helping out nonprofits:
Did you know that many charitable contributions to nonprofits are tax deductible? It is strongly recommended that you have a section in your home with your business as its primary function.That’s right, helping others can help you save some money. Make sure that there is documented proof of your donations.
Running your own home business:
If you are one of the many Americans that works from home, there are many tax breaks that you can take advantage of. Make sure that you are careful to differentiate areas in your home that are used for business. It is strongly recommended that you have a section in your home with your business as its primary function. According to the experts at Hillhurst Tax Group, if you are going to use your home as a tax write off, it is important to keep track of all necessary documentation in case of an audit.
Have you got any recent improvements to your home? Well, some improvements can end up saving you some money when you file your return. Energy saving improvements will earn you credit on your taxes.
These are a few simple ways to save money when filing your taxes. Saving money is all a matter of being aware of all possible options. This can be done with some research or having access to a good accountant.