Category: Taxes

If you are about to retire, then you know how important it is to file your taxes. Fortunately, the strategies you will learn in this article will be of great help to you. There are various ways you can maximize your returns, protect your wealth, and save on taxes. If you are not read for filing or do not have money to pay, consider asking for an extension from the IRS. The following are some of the tips you should consider.

Itemize Charitable Contributions

In most cases, you can deduct up to 50% of your taxable income in charitable contributions if they are tax-exempt organizations. Also, monetary donations, stocks, volunteering expenses, and personal property count as contributions.

Itemize Job-Related Deductions

Some of the expenses you incur with your job, you can also deduct them from taxable income. The following are some of the things that are related to your job: home office, education expenses, and auto expenses.

Consider Your Filing Status

If you are married, then you will want to plan on joint filing with your partner. Usually, this is the best thing you can do. However, certain circumstances can help you save a lot of money by filing separately. Usually, both of you will have a lower adjusted gross income. Therefore, if you have medical expenses, then you will need to file them separately to reach AGI percentage required for deductions. It is advisable to consult your CPA or financial advisor to see whether this is the right thing to do.

Claim Dependent Care Credit

If you are responsible for various expenses such as caring for dependents, such as a spouse or child, you are eligible for dependent care credit. For one person, the maximum credit you can get is $3,000.

Deduct Medical Expenses

You need to do this if your medical expenses exceed 10% of your adjusted gross income. If you are over 65 years old, this will continue until the end of the year. For instance, if you or your spouse is over 65 years, you can deduct the unreimbursed medical expenses that exceed 7.5% of the adjusted gross income.

Deduct Rental Property Expenses

If you earn income from rental property, then you can use some expenses such as insurance and utilities, as a deduction. You should to your tax accountant as certain stipulations depend on the value of your rental property.

Deduct Self-Employment Expenses

Self-employed people can enjoy certain tax breaks that can save you a lot of money when filing. Some of the things include education expenses, home office, equipment like telephones, and computers can be deducted.…

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