Taxes must be paid and they must be paid on time. That is the reality we are faced with every year. But did you know that the amount of taxes be reduced to ease the burden. There are steps to follow in order to save taxes and keep more of your money with you. Let’s face it. Tax payments are necessary but sometimes they can seem a bit overwhelming. Renowned financial advisor David Justin Urbas works with individuals and businesses around the USA as a consultant. Let us look at some of his tips on tax saving that can help you out.
Tax Saving Tips That Can Help You Out
1. Donate to charity – Donating to charity is a good way to save taxes and reduce the annual tax bill. It is advisable to donate towards the later half of the year, and you can enjoy tax return benefits when April comes. It is one of the smartest way to contribute to causes you believe in, while saving up on those tax Dollars.
2. Open up a business – Launching a new business can help you save taxes this year. Business owners have more flexibility over the way, and within which time, the taxes are paid. If you’re running a business, there are more opportunities to keep capital, and put it in the expenses column. Thus having a business can help one save significantly on their taxes.
3. Prolong your mortgage – The mortgage on your house needs not be paid in a hurry. One can benefit from prolonging the mortgage on their property. Due to mortgage interests falling under the tax deductible category, you stand to benefit financially.
4. Check tax credit eligibility – In certain cases, low and average income earners have a clear advantage. If you’re making less than 50K a year, you might qualify for tax credits. Credit amounts can be significant and come to your rescue.
5. Keep medical receipts – Certain medical costs, like those of particular medical equipment and appliances are tax deductible. You can do a little research to obtain the list of items that are included in the list of deductible items. This is yet another valid and legal way of saving on taxes.
6. Prolong education loans – Student loans are another way of saving taxes for a considerable amount of time, the more you stretch the payments. The interest that you pay with student loans is the beneficial factor. The amount can be deducted from one’s adjusted gross income. Thus it is advisable to do the loan payments in a slightly delayed manner.
7. Invest in 401Ks or IRA – Reducing your adjusted gross income by investing in 401 K and IRA retirement funds are a valid way of saving on tax payments. While less take home income might be hard to accept, it is for the greater good. You are saving up more for a secure retirement and effectively reducing taxes.
By following the tips mentioned above, you can save taxes and get better returns. As always, keeping your spending in check is essential too.