Tax time can be stressful for anyone. It’s a time when you have to fork over a lot of money to the Government. However, many end up paying much more than they have to. If you don’t know what you’re doing, you could find yourself paying more than you owe. Here are some of the hidden ways to boost your tax refund beginning with tax debt negotiation.
Hidden Ways To Boost Your Tax Refund:
1. Tax Debt Negotiation
One of the best ways to boost your tax refund is by opting for tax debt negotiation. If you are unable to pay your taxes when it’s time, you could find yourself qualifying for some relief. This is typically done through a settlement with the IRS. This can help you minimize the associated costs of not paying your taxes on time and in full.
2. Find More Deductions
Another good way to reduce your taxes owed is by finding more deductions that you quality for. You need to look at a list of deductions to ensure that you are using all of the ones you qualify for. If you aren’t doing this, you could be leaving money on the table. There are a lot of commonly overlooked deductions that you may not even be thinking about. These can include but aren’t limited to student loan interest, child care, sales tax, charitable contributions, and more. You want to think hard about all of the deductions you qualify for because they can play a big role in limiting your tax liability.
3. Have You Reconsidered Your Filing Status?
Your filing status plays a big role in determining how much you owe. This is easily one of the best ways to boost your refund. Many don’t consider this when they are filing taxes and it can result in them paying more on their taxes as a result. The status you choose can dictate how much of a refund you get. This is especially true if you are already married. A lot of married couples already file jointly even though it’s not always the best option available. While married filing separately does require more work, it can be advantageous to certain families. For instance, if one of the people has a lot of deductible medical expenses, it could make more sense to file separately. Likewise, certain things like The Child Tax Credit are only available to spouses who are filing separately [1].
4. Invest More
Whenever you are looking to file your taxes, it may be time to start thinking about adding to your IRA. Whether you have a traditional or ROTH IRA, you want to make any contributions during this time. By doing so, you can easily reduce the total amount of taxable income you have. This alone can be an effortless way to reduce your tax liabilities. You should be able to leverage the maximum contributions which can help when you are looking to minimize your taxable income.
Overall, there are a lot of different ways to boost the refund you get at tax time. Many file their taxes without even thinking about the many ways they can reduce tax liabilities and increase their returns. If you aren’t claiming all of the deductions that you qualify for, you could be leaving money on the table. Look carefully through the list of eligible deductions to ensure you aren’t doing that. Also, you may want to look into tax debt negotiation if you aren’t able to pay the full amount. Investing more into your IRA can be an easy and effective way to minimize the tax owed. Exhaust all options when it comes to finding ways to reduce your tax liabilities and you’ll find yourself paying less and enjoying a bigger refund during tax season.