Tax Doctor Questions - Tips on How To Save on Your Taxes.
April 10, 2017
1. Launch a business.
Becoming an entrepreneur can improve your tax situation because business owners can take more control over how they pay taxes. Entrepreneurs have the option of keeping more money in their company instead of drawing it down as income and they can also count certain costs as expenses. Come see us at ATAG and we’ll help you navigate the ins and outs of the Internal Revenue Service rules on eligible expenses.
2. Track your medical expenses.
Certain health-related expenses, including supplies like bandages and breast pumps are tax deductible. For a complete list of eligible items, visit irs.gov, and be sure to always keep all receipts.
3. Are you documenting the money you give away or pay in tithes and offering?
Charitable contributions aren’t the only type of tax-deductible gift. Individuals can also receive up to $13,000 without paying taxes, and parents can join forces to give each child $26,000 with a technique dubbed “gift splitting.”
4. Keep your mortgage longer.
Mortgage interest payments are tax deductible, which means homeowners benefit, from a tax perspective, by keeping their mortgage for as long as possible (as opposed to paying it off early). Of course, you have to balance that tax benefit against the additional interest payments incurred, and the satisfaction of paying off the debt if you have the savings to afford to do so.
5. Save more money for retirement.
Voluntarily lowering your take-home paycheck by upping your retirement contributions might be painful in the short-term, but it offers two benefits:
First, you beef up your retirement savings and
Second, you lower your tax burden. Money funneled into certain types of retirement accounts, including 401(k)s and IRAs, is tax deductible, within limits.
To see past questions and answers from Facebook live sessions, visit the Tax Doctor home page. If you have a question for the Tax Doctor, fill out the get in touch form below or contact us to get your questions answered. We also have a frequently asked questions page which has answers to typically asked questions. We look forward to helping you with all your accounting, tax and financial planning needs.
