5 Hidden Ways to Boost Your Tax Refund
At tax time, everyone dreams about a tax refund – and a large one. As you file your taxes each year, it is helpful to remember that a tax refund is actually an indication that you paid the IRS more taxes than you owed throughout the year. So, realizing that you are likely hoping to get back as much of a refund as is possible (and legal), we have compiled several places on your return where people often leave money on the table. Here are 5 hidden ways to boost your tax return this year.
1. How are you filing?
There are many ways to file your taxes, many forms to complete. Taking a good look at your filing status and your withholdings from many angles may help you determine if you are maximizing your refund. For example, you can change your withholdings each year by making an annual appointment with your HR representative and increase your withholding on your W-4. Increasing your withholding will increase the amount of paid to the IRS throughout the year and give you a larger refund come April. In addition, most married couples choose to file as “married filing jointly”. But you could also elect to file as “married filing separately” to see if that yields a larger refund.
2. Contributions to your own retirement
You already know that a retirement fund is like a savings account with more benefits. You may not be aware that the more income you contribute to your retirement savings account, the less the IRS can count your annual income. This can both help boost your refund and get you ready for retirement as well.
3. Charitable Donations
Keep track of each time you donate to a charity. It sounds simple, but each donation counts and can really positively impact your refund each year. Keep solid records all year round of the donations that you make (clothing and household items in addition to money) and do not be afraid to deduct these items at the end of the year. Volunteer work counts here too, so keep track of mileage and any supplies purchased. You’ll be surprised how much it helps.
Tax laws change each year and your personal status may change as well. Make a point to be familiar with new tax law and deduction programs that might apply to you. In addition, if you have had a significant change in your status (marriage, new child, death), you want to make sure that you are maximizing all possible deductions.
5. Have your return reviewed
Having your return reviewed by a reputable tax firm can very often increase your annual refund. Tax experts know the most current tax laws and can run your tax return several different ways to see what ultimately benefits you the most. While there is a small fee for this service, many times, the addition to the refund offsets this cost.
If you would like more information about how to maximize your refund this year, consider partnering with a company with a track record of success. Success Tax Relief has over 30 years of experience working with customers to get the highest possible refund. Contact us today to make the most of your refund!