Smart Tax Tips

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    • Tackle your taxes armed with knowledge.TAX TIME image by brelsbil from Fotolia.com

      While refund recipients commonly enjoy tax day, many tax owners greet the season with chagrin. Regardless of your income and deduction opportunities, there are things you can do to increase the amount of money you get back or reduce your IRS deficit. By considering some smart tax practices you can ensure that, upon completion of your taxes, you add or retain as much money in the bank as possible.

    Try an Assortment of Options

    • Before marrying yourself to one tax completion option, try an assortment of possibilities to prove unequivocally which one is more advantageous for you. For example, if you're married, complete your taxes both as joint tax filers and separate. Until you move through the tax completion process in its entirety, you can't really see which option will ultimately be most beneficial to you. After trying both options, submit the one in which you have the least tax responsibility. This may mean that one party ends up owing. If the total sum you and your spouse receive back exceeds your refund when filing jointly, give it a go as separate tax filers.

    Consider the Impact of Income

    • While it may seem that the more income you make the better, in some instances this is not true. Many tax payers get burned when they work a small second job, as this job often does not withhold enough taxes and, in some instances, the additional income can push the tax payer into a new bracket. Before picking up a second job, explore the tax bracket system and ensure that your secondary employment will prove beneficial.

    Increase your Green Savings

    • Decrease your carbon footprint and receive tax benefits simultaneously. As tax season approaches, purchase a green vehicle or make energy efficient upgrades to your house to reap the benefits of green tax credit opportunities.

    Avoid Cash Contributions

    • While you can deduct charitable contributions made in cash, doing so is much more difficult than deducting contributions that are better documented. Instead of pulling cash out of your pocket the next time you are in a giving mood, write a check so you have a paper trail to follow when tax-prep time arrives.

    Let the Return Rest

    • Many tax preparers are eager to send their tax forms on their way. Instead of mailing yours out as soon as you complete them, MSN recommends that tax payers let their refund rest at least overnight. After a good night's sleep, look back over the prepared refund and check it for errors or missed dedications with fresh eyes. Taking the extra time to do this could save you money in the long run.

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