For many, it seems every season is tax season. Though you typically receive your W-2’s sometime in February and have your taxes filed by mid-April, various aspects of Income Tax preparation are probably floating around in the back of your mind all year. Almost every major expense you encounter, and even some of the smaller ones, could either be a deduction or a significant blow to your overall budget.
You can’t avoid paying in taxes in one form or another. As increasingly unpopular as it may be, even being unable to afford health insurance is going to cost you each year. While certain elements will add up over those periods in between tax times, a few considerations can help you combat those mounting expenses.
First of all, if you were forced to pay in state taxes last year, you may be able to use this to your advantage next time around. Any amount you paid must be weighed against the state taxes withheld from your income during the season being filed. In the event you purchased a vehicle, the state taxes you paid as a result could also be figured into your state filing. Whether or not it’ll work in your favor depends on a number of factors.
Acts of charity can also go a long way toward offsetting any amount you may owe. Numerous people donate clothes, old appliances. and household items to Good Will, the Salvation Army or other organizations. In turn, they’ll give you a receipt to count toward your next tax filing. While any number of people receive these receipts, few actually remember to turn those over to their Income Tax preparation agent. They could really add up over the course of a year.
Earned income tax credits are also benefiting a growing number of people. Though you may not consider your household to be in the low-income tax bracket, the government may feel otherwise. If you lost a job after filing last year’s taxes or took a wage or hourly cut, you might easily qualify for this credit. Ask your accountant to check previous years, as well. Those who could’ve claimed this credit in the past, but didn’t, may be eligible for reimbursement. Contact an agent to learn more about ways to combat having to pay in a great deal of money next time you file your taxes.