5 Sure Ways to Increase Your Tax Refund: Count Your Deductions to the Very Last Penny
In this season of obligatory giving back to Caesar, nothing could be as good as getting the maximum tax refund you can bargain for. I have known people who year after year have their bank accounts piling with refund dollars that at least assuage the agony of having to part with their hard earned dollars.
I also know of a group that performs dismally while it comes to collecting refunds or claiming for deductions. This group that receives nil to dismal tax refunds would swear that tax refunds are as much of a hoax as the sighting of UFOs in Melbourne. Their biggest question remains, how do I ensure maximum deductions and tax refunds? Here are five sure ways to increase your tax refunds and give you a smile to smile even as you prepare to give Caesar (or Uncle Sam) his due.
- Deduct Your Contributions to Nonprofit Charity
We all feel the need to give to charity from time to time. In fact, doing so is not only commendable but also recommendable. And what is more, donations to nonprofit charity organizations such as the Goodwill or the Salvation Army are legal deductibles from your tax!
The only catch here is to know what kind of charity are deductible and up to what threshold you may add these to your refund tax calculations. Try to especially confer with your lawyer/accountant as to up to what amount you may include as charitable deductions. Make sure that you get a receipt for all your nonprofit charity donations and produce it in case of an audit.
Charity donations in the form of the following may be included in your tax deductions.
Mileage: If you used your car for a charitable course, you may deduct some of the mileage as charitable deductions.
Property: Property in the form of furniture, automobiles, real estate, office supplies and/or electronic equipment.
Cash: Cash donations are also deductible
Tithe: Money given to churches and other religious organizations is also deductible.
- Professional Expenses
Expenses incurred at the course of your employers duties can be added to your deductible income tax. Lets say for example that you subscribe to some publications that keep you up-to-date in your line of work, or maybe you use your cellphone’s airtime for the benefit of your employer, these expenses do qualify as deductible tax and can immensely contribute to your tax refunds.
- Review Your Tax Filing status
To a very large extent, your tax filing status plays a crucial role in determining the amount of tax income you are liable to, and what refunds you may get from such returns. For instance, a married couple who jointly file their returns may expect bigger tax returns than one that files their returns separately.
Filing status may also change and affect your tax refunds if you happen to be divorced or your spouse passes away.
In certain cases however, filing separately, works better by beating the threshold of deductibles due.
Don’t forget to include your filing status when filling your 2013 income tax returns.
- Dependents Care
Do you have people who are dependent on you and who you accrue expenses taking care of. expenses spent on Familial dependents, according to the IRS,are deductible from your income tax filing. These dependents may include children and elderly family members. Alimony and health care expenses for dependents are also deductible. You may however want to visit a tax professional to find out how much of the expenses spent on familial dependents is actually deductible.
- Increase your IRA Contributions
Increasing your retirement benefits contributions is one of the surest ways of increasing the income tax refunded back to you. IRA contributions reduce your taxable income.