Money, its the root of all happiness (that’s how the saying goes, right)? Well, at least that’s how it goes for me because when I get more money from a tax refund, I get more happy. There has to be some correlation, right? Well of course there is. Tax refunds can be a source of extreme happiness. So the question is, how do we get bigger refunds which lead to more happiness? See what I did there? So lets look at some ways to help bolster those tax refunds this year.
Check Into Your IRA Contributions.
Did you know that you have until April 15th to set up a traditional IRA for the year prior? This means you can file early and use your refund to open the account. Savvy, huh? Most people don’t know that. Contributions also reduce your taxable income, which really is the key element to a refund of any sort.
Check All Tax Deductions.
Many people are afraid of deductions, but really, there are a lot of legitimate deductions which everyone should take advantage of. Have you been job hunting or doing volunteer work? What kind of travel have you been doing (auto gas and plane tickets and baggage fees)? The amount of miles you’ve driven should play a role as well. Keep records of all this stuff. If you don’t have it right in front of you potentially from being a touch unorganized, go back through your credit card statements and see what you come up with. If you moved that year at least more than 50 miles, there is a good chance you can deduct all kinds of moving expenses (as we all know there are many). And don’t forget the charities you’ve given to, they are deductible as well.
The biggest thing here is learn to keep track all year long of what you spend on so you have the opportunity to lower your taxable income. You’d be surprised at how many items people never deduct due to forgetting they even spent it! You don’t want to lose out during tax season!
Maybe Say No To A Joint Filing Status?
Its something to look into, particularly if one person has way more deductions than the other. Married couple often think they have to file jointly, but that isn’t really true. Do your research, talk to your accountant…the more you know!