As we’re getting closer to the holiday season, it means that something else is coming up quickly that we may not feel ready for—tax time! But that doesn’t mean it has to be something you dread and stress out about. Instead, you may find yourself wondering how you can reduce your taxable income at the end of the year and save some money.
Here at Maggi Tax, we’re always helping you find the best ways to save money on your taxes and ensure that you’re getting the most out of all the hard work you put in every year. So, today, we’ve put together our top five tips for minimizing your taxes. This way, you can start saving money on your taxes now without having to worry later!
Feed Your IRA, Lower Your Taxes
If you didn’t know already, all the money that you contribute to your traditional IRA is considered a pre-tax contribution, and it lowers your total taxable income. So, if you’re looking for a way to save money on your taxes, reducing your total taxable income is one of the best ways! Whether you itemize your deductions or take a standard deduction, feed your IRA now, and you’ll end up owing less when the taxman comes.
Donate To Your Favorite Charity
One of the easiest ways to reduce your tax bill is to make a charitable contribution. And you don’t just have to write a check to make a charitable contribution or deduction. For example, you can donate toys, clothing, and other household items to shelters that support the needy.
Invest In a Health Savings Account
Just like feeding your retirement account can lower your taxable income, putting money into your health savings account, or HSA, can do the same. If you haven’t met your annual cap, invest as much as you can afford to. For couples and families, it’s up to $7,000 per year, and every dime you fund your HSA with lowers your income taxes.
Organize Your Receipts
If you’re going to claim deductions or have a home-based business, getting started now on organizing your receipts can save you money. Of course, the more you can prove in write-offs, the better chance you’ll have to actually write it off. But every write-off must have proof, so be sure to start organizing now!
Look For Lesser-Known Deductions
Did you pay interest on your mortgage this year? Or have unexpected medical bills with costly out-of-pocket expenses? These are some ways you can maximize your return on itemized deductions and end up minimizing your taxes.
If you’re looking for ways to lower your taxes before the end of the year, these are great places to start. For other tax savings tips, be sure to check out the Maggi Tax blog posts here!
Remember that the experienced team at Maggi Tax is always available to help you organize and file your taxes so you can save the most every year! So, give us a call today!