Catch a Gideon

Taxes - Personal Finance Tips

January 31st, 2007 by digerati

1. Know when to file your taxes. If you expect a refund, file your taxes as early as you can. If you owe money, file as close to the due date (usually April 15) as possible.
2. Consider itemizing your deductions. If all of those tax breaks receipts you keep add up to more than your standard deduction, it is definitely worth filling out all of the extra paperwork to itemize.
3. Be aware of other tax deductions. Contributions to a traditional IRA, student loan interest payments, alimony payments.
4. Save money on tax credits. Some tax credits to look out for include the Hope Scholarship Credit, Lifetime Learning Credit, Child Tax Credit, Earned Income Credit, and Child Care Credit.
5. Bunch your deductions into one year. If you’re taking the standard deduction this year, consider making charitable contributions and office-related purchases after January 1, so you can possibly itemize your deductions next year.
6. Recheck your withholding every year. If you get married, have kids, or become the head of a household, you’ll want to add these allowances on your W-4 so you can have fewer taxes withheld.
7. Keep your receipts (especially on big ticket items). You’ll want them if you plan to itemize, or in case you get audited.
8. Concentrate on tax-free investments. Tax-free investments, like bonds, allow you to earn interest without being taxed.
9. Buy a hybrid vehicle. Hybrids tend to be more expensive than their traditional counterparts, but you can save money on gasoline and possibly receive a tax credit of up to $3,400.

Source: Your Credit Advisor

Bookmark to: