We know we can’t avoid death or taxes, but it sure is worth considering how to prolong life… and pay less in taxes (legally of course). We’re taking a look at some of the lesser-known ways we can see a lower tax bill at the end of the year based on the nuanced situations in which we may find ourselves!
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Disclaimer: We are not tax professionals, we do not give tax advice, this episode is for educational purposes only and if you think something applies to you, double-check it with your tax software or CPA.
This article from US News outlines some of the lesser known tax codes we could be taking advantage of to see a lower tax bill at the end of the year!
What Jen and Jill have to say:
- Contribute to retirement account
- Open a health savings account (triple tax advantage)
- Claim home office deduction
- Deduct half of your self-employed taxes
- See if you qualify for an earned income tax credit
- Make charitable contributions
- Use side hustle to claim business deductions
- Write off business travel expenses (while on vaca) – only if have a side business
- Get credit for higher education
- The American opportunity tax credit can be claimed for the first four years of college and provides a maximum credit of $2,500 per student per year.
- Itemize state sales (can deduct the sales tax paid on items) – for those who itemize their taxes rather than taking standard deduction
This article from Turbo Tax gives us 5 ways to see a higher tax refund.
More from Jen + Jill:
- 1. Rethink your filing status
- 2. Embrace tax deductions
- 3. Maximize your IRA + HSA contributions
- 4. Timing can boost your tax refund
- Look for payments or contributions you can make before the end of the year that will reduce your taxable income.
- 5. Become tax credit savvy
BILL OF THE WEEK – Thank you Natashia for sharing your bill about Christmas gifts and how you decided to repurpose belongings into gifts for others!
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How we save on taxes:
- Jen- We use an accountant!
- Jill- I moved to Florida where I DON’T HAVE TO PAY STATE AND LOCAL INCOME TAX ANYMORE!!!!!!!!!
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