5 Things To Do After You File Your Taxes
Since Tax Day has come and gone, the last thing you probably want to think about now is taxes! But there are a few things you can do right now to be better prepared—or to lower your tax bill—for next year’s filing.
Rethink your refund.
Are you using your taxes as a temporary savings plan or would you be better off increasing your monthly take-home pay? A $1,200 refund equates to $100 per month more in your take-home pay that you could add to your savings or investment accounts—meaning you will be earning the interest on that money throughout the year. Check the online IRS Withholding Calculator for details on how best to adjust your withholdings for your needs.
Decrease taxable income
Make pre-tax contributions to your IRA, 401(k) or a Health Savings Account. You can begin to lower next year’s tax burden now, spreading the cost out over time.
Consider charitable giving
Donations are a feel-good way to lower your tax bill. Donations to 501(c)(3) organizations as well as donations of goods or clothing are all deductible—and help those in need.
Start next year’s tax file
Starting now while things are still fresh in your mind. Drop in this year’s return to start the folder. Throughout the year add documents you’ll need for next year. Gather mortgage interest statements, investment statements and other materials that substantiate deductions you claim.
Buy a home
If you are currently renting, you are missing out on big potential tax savings available to homeowners. The IRS currently allows real estate taxes, mortgage interest and mortgage insurance premiums to be included as itemized deduction on Schedule A. This would be in lieu of the standard deduction. For more information on this, read this article on the IRS webiste.
The tax, interest and mortgage insurance deduction could potentially reduce your taxable income and tax liability
Are you ready to shop for a home? Contact me today and I will get you started with a Free pre-approval.