4 Ways to Get a Bigger Tax Refund
4 Ways to Get a Bigger Tax Refund – Here’s How You Can Take Advantage of Every Possible Tax Break
While most Americans would probably agree that filing income tax returns is a pain in the neck, it can still be a great opportunity to save or get reimbursed for the money one doesn’t know they were entitled to. You can claim a bigger tax refund by taking advantage of every possible tax break there is.
With the tax deadline extended until the 15th of July due to the coronavirus pandemic, you have no excuse to not find ways to maximize your refund.
Here are four strategies to help you snag a bigger tax refund and reduce your tax liability. Check them out below.
- Choose your filing status wisely.
Many might not know this yet, but your filing status has a huge impact on your tax payment. If you happen to be married, it makes perfect sense to file jointly. However, it doesn’t automatically mean that you and your spouse can benefit from it.
For instance, if you and your spouse have a significant amount of business expenses, computing your taxes separately could lead to a bigger deduction. The downside is, filing individually means losing certain deductions that are only available to joint filers. That said, you and your spouse should weigh in the pros and cons together.
On the other hand, if you’re single with a qualifying dependent, you can cut your tax bill by filing with a “Head of Household” status. To be eligible for that, you need to have paid more than half of your elderly parents’ financial support, even if you don’t live with them anymore. Keep in mind that heads of households receive a bigger standard deduction than single taxpayers.
- Don’t overlook tax deductions.
Taxpayers often forget about their applicable tax deductions. While it’s true that credits yield larger tax returns than deductions, your deductions can still help by reducing your taxable income.
When filing your taxes, you need to choose between itemizing your deductions or taking the standard deduction. Although many filers prefer the more convenient option of choosing standard deduction, itemizing is the wiser choice if you have many deductible expenses that are worth a considerable sum when added.
- Maximize your IRA.
You can make an Individual Retirement Account (IRA) contribution for your 2019 return until the 15th of July, which gives you the flexibility to claim the credit on your return, file early, and open your account with your tax refund. Traditional IRS contributions may reduce your taxable income. With the IRA being an above-the-line deduction, you’re free to take the deduction even if you’re not itemizing.
Your contributions may also allow you to claim a tax credit, such as the Retirement Saver’s Credit. However, you will need to meet income guidelines to qualify. Self-employed taxpayers have until October 15th to contribute to a self-employed retirement plan, given that they file an extension.
- Timing is key.
Being mindful of your schedule also increases your odds of getting a bigger tax refund. Mark your calendar or organizer for contributions and payments you can make before the year ends, and be sure that they will reduce your taxable income. Here are a few tips to try:
- Boost your chances of medical expense deduction by scheduling your medical appointments and exams in the last quarter of the year.
- If you want to claim an extra interest for your mortgage interest deduction, set your January mortgage payment before December 31st.
- If you’re self-employed, you can boost your refund by purchasing office equipment before the end of the year.
Get the Highest Possible Tax Refund!
A sure-fire way of increasing your tax refund is by making an auto donation to us at Kids Car Donations. Since we are in partnership with IRS-certified 501(c)3 nonprofit organizations, all of our donors are entitled to receive maximum tax deductions.
Your donation will help in the treatment and care of children and teens in your community who are facing serious health issues, saving their lives and leading to their recovery.
We’ll sell your donated vehicle and transfer the proceeds to our charity partners. These IRS-certified 501(c)3 nonprofits will use the money to provide their young beneficiaries with comprehensive and quality medical assistance, including free and easy access to vital health services, emotional support, and other essential health care services.
Aside from the privilege of receiving a tax deduction, we will provide you with our free pick-up and towing service wherever you are in the country.
We welcome nearly all vehicle types, including those that need a lot of work.
For more information on our vehicle donation program, including our quick and convenient donation process, visit our FAQs page. To learn what actions we’ve taken to make sure our donors are protected from the coronavirus, you may click this link.
If you have inquiries or concerns, feel free to call us at 866-634-8395 or leave us a message online.
Turn Your Clunker into a Lifesaver Today!
Are you ready to turn your clunker into a tool that can help restore and save the lives of ailing children and teens in your area? Call us at 866-634-8395 or fill out our online donation form now!