Updated: 11-17-17. This is a post by a guest contributor.
We’re barreling into the new year, guys, and that means tax season is right around the corner. Taxes aren’t fun for anyone, but if you’re anything like me, the hefty return you get after filing can make all the trouble feel more than worth it.
If you’re looking for ways to enhance that return and receive a big check from the IRS, consider these easy ways to see more money back in your pocket—talk about the money-savin’ deal of the year.
How To Get A Better Return On Your Tax Refund
Consider Amending Your Filing Status
Changing your filing status is one of the easiest ways to see a bigger return, as long as the amendment applies to your situation. The IRS offers varied deductions dependent upon your filing status, and some can garner you larger tax refunds. In general, a married couple who file jointly can expect to claim twice the standard deduction in comparison to single filers or couples who file separately. However, this isn’t true in all cases.
While 96 percent of couples filed together in 2009, some couples have found that based on their circumstances, their returns would have been higher had they chosen to file separately. Without a bit of tax prowess, it can be hard to determine.
So if you and your hubby are looking for a way to get more money, think about assessing both options to determine which will be more lucrative, and get professional help to figure it out if necessary.
Recommended Reading: How To Start Your Own Homebased Tax Preparation Business
Look into Tax Deductions
You may be missing out on some lucrative tax deductions. These qualified expenses can reduce your taxable income by an incredible amount. If you’ve made donations to any charitable organizations, the cost of the donated items is deductible.
This can include contributions to charities, nonprofits, and other applicable organizations. So do your research and find out what’s qualified for deductions. Proving this will require receipts so be diligent with your bookkeeping.
You can also deduct any job-related expenses. This may include a home office, out-of-pocket expenses for work that your boss doesn’t reimburse you for; examples include transportation costs, uniforms, or electronics used only for work.
Familial obligations also may give you a larger return. If you send your child to daycare in order to be able to work, or pay for the care of an older dependent, like an elderly parent, you can deduct these expenses as well.
Increase Your Withholding
Your employer probably gave you a W4 when you started your job that determined if you have children or are married. The more people you have in your household, the more exemptions you can claim when it comes time to file.
By asking human resources to drop one of your exemptions, you can withhold more money each month and see a bigger return come April.
Contributing to an IRA
The more you contribute to an IRA—or individual retirement account—the higher the tax break you get from the government, as long as you are not covered by a traditional retirement plan at the office. While there is an annual contribution limit, those who make a higher income cannot deduct all of their IRA contributions.
Also, if you’re over 50, you can add the catch-up provision to your IRA for an even larger return. And that means more money in your bank in the short and long run.
Refinance Your Home
When you refinance your home, you begin a new payment process which makes a larger part of your mortgage straight interest. The IRS allows taxpayers to deduct any interest paid during the year on a home mortgage. This means, the higher rate of interest, the higher your income deductible becomes. So consider refinancing with a company like BB&T, it might be in your best interest!
Use Professional Services
Taxes get tricky, especially if you’re doing all that you can to receive a bigger return. Claiming deductions and credits on your tax return comes with its own set of complicated rules. So it may be wise to seek professional help.
Use a company like Community Tax and find accountants who can help you navigate the waters of securing a larger refund with little stress off your back.
Over To You
I hope this post helps you get a better tax refund.
Now let’s chat!
Do you cringe every time tax seasons rolls around or do you go with the flow? Let’s talk about it in the comments section.