As tax season draws near, everyone looks for strategies to increase their refund. Discover the undiscovered tactics that go above and beyond the obvious to make sure you pay what you owe and maybe even get a bigger return. We’ll go over five tried-and-true strategies in this guide to increase your tax refund in 2023.
Reevaluate Your Status of Filing
Tip 1 for Maximizing Tax Refund:
Selecting the appropriate filing status is essential. Although married filing separately might be a game-changer in certain situations, most couples choose joint filing. Experts at TurboTax say that having this status can result in tax benefits, particularly if one spouse has high deductible medical costs or if it qualifies you for a larger Child Tax Credit.
Tip #2: Optimize Tax Refund:
Filing as Head of Household, which offers a bigger standard deduction and more advantageous tax brackets than filing as Single, might be advantageous for unmarried taxpayers with dependents. Interestingly, if they offer more than half of their parents’ financial support, a large number of caregivers for elderly parents can be granted this status.
Tip #3: Optimize Tax Refund:
Discovering frequently disregarded deductions might have a big impact on your tax return. These deductions can add up, and they include state sales tax, reinvested profits, student loan interest, and out-of-pocket charitable contributions. In order to ensure that you take advantage of any potential savings, TurboTax stresses the significance of keeping thorough records for these deductions.
Take advantage of tax breaks
Tip 4: Get the most out of your tax refund:
Putting money into standard IRAs and HSAs can lower your taxable income even more. TurboTax suggests taking advantage of the freedom to put money into a standard IRA until the tax deadline, and you could even use your refund to open the account. Also, until the deadline for filing taxes, pre-tax donations to an HSA can be made as long as certain conditions are met.
Tip 5: Get the most your tax refund
Time is very important. If you plan ahead and make certain payments or donations before the end of the year, for example, your taxable income will go down and your refund will go up. Knowing the calendar can help you get a bigger tax refund by helping you figure out things like mortgage payments, medical bills, charitable gifts, and home office deductions.
To get the most money back from your taxes, you need to make smart filing decisions, take smart deductions, make timely payments, and know about valuable tax credits. These hidden methods will help you get through tax season with confidence, and you might even get a bigger refund in 2023.
