Here in the U.S., April 15th is the deadline to file your tax return. Not a pleasant day. Want to feel even more depressed? Tax Freedom Day isn’t until April 18th.
Tax Freedom Day is the first day of the year in which a nation as a whole has theoretically earned enough income to fund its annual tax burden. That means that all of the income Americans have earned so far this year is going to the government.
Traditionally paying taxes was a boring responsibility by individuals who were supposed to contribute to the government. After the Bush-era tax cuts, lawmakers started to craft new laws such as health care sometimes known as ”Obama Health Care”, housing bills and e.t.c
Whenever money passes through your hands, it seems that you pay someone kind of tax. Consider the following;
- When you work and get paid, you pay all sorts of taxes i.e. federal, state and local taxes.
- After paying taxes on your earnings and then spending money on things you need and want, you may have some money left over for investing. Guess what? Your reward for being a saver is that you also pay tax on some of the earnings on your savings.
Before we start on the 105 tips on saving money on taxes, let me give you my thoughts on taxes;
According to my thought: Do you feel disorganized? Do you not know where to turn for tax help? Are you in bad mood about all the forms you must complete and the taxes you have to pay? We can’t eliminate all the most forms and taxes, but this content will help you find and save competent tax help, should you be at your wit’s end.
I have a feeling that you’ll really love this tips and share the ideas to your friends via social media sites. For more detail report, check J.K. Lasser’s Your Income Tax 2013
- Convert traditional retirement account to an Roth IRA (Individual Retirement Account): When you convert your retirement account to Roth IRA, it will help you spread your taxes equally i.e. your first Roth conversion tax bill be included on your 2012 return filed in 2013.
- Request your American Opportunity tax credit: If you’ve legitimate education expenses, make sure to claim the American opportunity credit this will help you to save some dollars.
- Pay your tax before time: To pay your tax at the lower rate, I’d advice you accelerate your income into 2013.
- Buy winning stocks that will help you lock in profits on a long-term investments
- If your income is in the higher tax bracket, I’d suggest you chat with your tax advisers on how you can plan ahead
- Limit your alternative minimum tax exposure
- If you’re generous and kind I’d advice you start giving to charity as this will help you reduce your annual tax bill.
- Review your estate tax implications so as to avoid any possible larger federal tax bite.
- For efficiency and reliability, hire a registered Tax- Pro
- For bigger savings, make sure to file your return
- To get more money when you earn it, I‘d suggest you file a new W-4 Form with your employer
- Increase your savings retirement in 2013 and beyond
- Stash money in an IRA as this will help you take free withdrawal.
- Be aggressive with your health tax break sometime known as flex plan
- Pay for your child bill’s expenses with pre-tax dollars
- Request your employer to pay for you, so as to improve your self
- Before you quite job, make sure to pay back 40(K) loan
- Cut your job hunting cost
- Keep track of moving cost
- Cash in on tax credit so as to improve your home design and energy
- Install alternative energy devices so as not to compromise on your taxes
- Put your cheque book away so as to avoid donating fund shares
- When you’re doing charitable work make sure to keep track on your spending activity
- If you plan to get married, my advice would be to get married after April 15th
- This is weird: Adopt a child and you’ll save a lot of money on your taxes (Any issues on this, put your comments below and we’ll square it out)
- Understand deductible IRS
- Create a Google doc and keep all the deductible expenses intact
- Keep track on your mileage expenses
- Remember to deduct medical expenses for your dependents
- Understand the federal taxes: The more deductions you can claim, the less you’ll pay for your taxes
- Report any income you have such a s salary, wages and other compensation to IRS so as to avoid penalty
- To avoid penalty, make sure to put alert on your IPad so as not to forget the due date.
- Claim any refund
- Amend any returns that may occur or that needs to be corrected
- Plan wisely for your medical plans especially for the self-employed individuals
- Tax savings for residence sales
- Tax rates based on filing status
- Computing ”Kiddie Tax” on your child’s investment income
- Figuring your regular income tax liability
- Claim your standard deduction
- Having income from real estate rentals and royalties, can do wonders in your tax reduction
- Make college less expensive with tax planning
- Find the best Nevada Corporation entity for your business
- Beat the dreaded IRS audit
- Convert your home office into a tax-deductible money machine
- Income shifting and income splitting
- Deduct your expenses such as golf, sporting tickets etc.
- Start a home business
- Join investments clubs as they are very promising in investments returns
- Invest your money to binary options so as to maximize your profits and reduce your taxes.
- Take action when you see your deductions are not happening
- Do your own taxes yourself as this will help you save hundreds of dollar
- Understand your marginal income tax rate
- Do your own returns
- Use IRS publications
- Pursuing Tax-Preparation and advice guides
- Buy a software that will help you save money on taxes
- Access intern tax return
- If you have money, then hire a Tax attorney
- Continue to keep good records for your expenses
- Decide when to fund, stash and when to trash
- Reconstruct missing tax records such as property received by inheritance or gift.
- Make sure to request copies of lost tax returns
- Understand the Cohen Rule
- Figuring personal and dependent exemptions
- Securing social security numbers for dependent
- Filing a return for deceased tax payer
- Adjust your income tax for your spouse or your child
- Enter your short term goals in total
- Withhold the right amount of tax
- When investing, make sure to take into consideration the tax menace
- Don’t ignore the financial aid tax system
- Don’t ignore taking tax legal deductions if there is any
- Use your tax advisors effectively
- Separate business from personal finances
- Invest in someone else business
- Buy and hold for long term capital gains
- Invest in tax-friendly stock mutual funds
- Make sure to make a tax-wise mortgage decision preferably 15 year or 30 years mortgage
- Get full time scholarships for your child
- If you’re rich, make sure to reduce expected estate taxes. You can do this by setting up trust and establishing a bypass trust.
- Insure all your assets in your house and in your private office or your private business
- Invest in Hollywood movies, this will totally save you from huge taxes
- If you’re considering doing charitable activities, then the best place to do that is in Africa, particularly Kenya, Malawi, South Africa, Tanzania.
- Invest in Business communities
- When you plan to move in a particular town, make sure to put into consideration, the town expenses e.g. if you live in California Orange County, you’ll pay more tax that living in Manhattan.
- Avoid emotional stress, especially when your Tax math’s don’t add up
- Look for sponsorship who will do business, with you as this will help you save a lot on taxes
- Start an event e.g., sporting event as this will help you spend less and earn more thus lowering your tax cut.
- Do you import or export? Then you should buy a large quantity of products that will suppress the tax to an affordable price.
- Consider tax savings for the following categories: For the young people, single people, young families, older families, affluent families, older affluent people and for empty nesters.
- Avoid taking to much of your paycheck otherwise you’ll end up paying more than you imagined.
- One of the best way to save money on your tax, is by boosting your savings
- Before you consider huge pay rise, make sure try withholding calculator that will help you predict if you really need more allowances.
- Boost your 401(K) so as to avoid tax break
- Make sure you have a stable saving account that will help you augment your finances without jeopardizing your tax
- To save 20% to 70% of your tax, consider going for a big FAT health tax break so as to help you in your retirement.
- Considering using pre-tax dollars if you pay your bills via your child’s expenses
- Don’t take any loan if your Return on Investment will be low
- Consider cost of your workers group health insurance cover as this will help you pay the premiums via your payroll deductions system.
- When filling out forms, make sure to pay close attention to form 1099-K. This form was introduced so as to get hold on small businesses who never disclose other income generated by their business.
- Also make sure to pay attention to basis reporting
- To save a lot money on your tax, it would be better you invest with government securities and treasury bills
- When considering high pay check, make sure to consider more tax payments as this will help you do your math’s correctly
- Last but not the least: Rather than giving to charities, consider establishing your own foundation, as this will REALLY help you save more on your TAX.
- BONUS: If you want more time to finish your income taxes and get up to 6 more months to finish your taxes, then FileLater.com is the better option.
Over to you
Oooo Man Seriously? I cant believe you just read (or at least scrolled through) 105 ways of saving money on taxes and nearly 1593 words. You have time.I LOVE YOU! and i can i assure you that the above secrets will help you alot.
If you want to be a tax free man, then you should follow the above tips. What do you think of the 105 ideas? Leave your comments below for discussion.
Taxation without representation isn’t good, but taxation WITH representation ain’t all that great either.
As a disclaimer, I do use affiliate links for some of the products listed. They are all products I would recommend regardless of whether they have an affiliate program.