How To Boost Next Years Tax Return
June 21, 2019
Did you receive a lower-than-expected tax return this year? If so, you are probably wondering what you can do to keep the same situation from happening again. Thankfully, there are several perfectly legal things you can do with the help of your Encino tax advisors to reduce your tax liability when tax preparation season rolls around. Here are a few suggestions to help you get started:
Adjust Your Withholding Amount
If you don’t receive a refund or if you owe money when you file your taxes, you may want to adjust your withholding amount this year. You can do this by reducing the allowances number you claim on your W-4. Keep in mind that reducing your allowances will increase the amount of taxes that are automatically withdrawn from your paychecks. However, some people prefer to have slightly less money with each paycheck so they qualify for a tax refund at the end of the year.
Rethink Your Filing Status
You have five options when it comes to your tax filing status:
• Single
• Married filing separately
• Married filing jointly
• Qualified widow(er) with dependent child
• Head of household
In some situations, married couples may actually enjoy a more favorable tax situation if they file separately instead of jointly. If you are unsure what filing status you should choose, consult with your Encino tax consultants.
Take Advantage of Applicable Deductions
There are many different deductions and tax credits you could potentially claim on your taxes. If you don’t know about them, though, you probably won’t claim them even if you qualify. Rather than filing taxes yourself, rely on Los Angeles tax preparation services to help you determine which deductions you qualify for on your tax forms.
In addition to these suggestions, your Encino tax advisors may also recommend that you enroll in tax-advantaged spending plans such as a health savings account or other employer-offered programs. You can also increase your refund by contributing to a traditional retirement plan such as an individual retirement account or 401(k).
