If all of your children have left home and moved on, it is time to start thinking about ways to save on your tax bill. There are actions you can take throughout the year that will keep your taxes low, and put money back into your pocket.
File a brand new W-4.
If you have received a tax refund this past year, chances are you are paying too much on taxes from your earnings each time you receive a paycheck. Put money back in your pocket by filing a new W-4 with your employer to guarantee you get more money as you get paid.
Place money in a self-employed retirement account and save.
If you are a business owner, make sure you are putting money in an individual 401(k) or a Simplified Employee Pensions (SEPs). Every time you save money and place it in one of these accounts, you lower your taxes while your tax-deferred earnings increases in your retirement account.
Pay all back taxes.
It is impossible to start saving on your tax bill, until you pay all delinquent tax bills owed to the IRS. Paying the IRS now will help save you time and lots of money down the road. It is important to meet with a tax resolution lawyer immediately to resolve your IRS debt.
Pay back all 401(k) loans.
If you fail to pay back a 401(k) loan, the loan amount will be deemed a distribution. This means you will be taxed, with penalties, in your top bracket if you are younger than 55.
Keep all documents.
Well-documented tax deductions will save you time and money come tax season. Remember, most donations and business expenses are tax deductible, so do your research and save your receipts.
Find an expert.
If you or someone you know needs the help of tax resolution specialist, it is important to contact U.S. Tax Shield today. Our tax resolution lawyers will help you develop a method to pay back the IRS and stay out of debt.