Let’s face it – none of us want to pay more in taxes than we really have to. As the dreaded April 15th deadline looms ever closer, finding tax breaks can mean the difference between getting a big, fat check back in the mail and having to shell out personally to the Internal Revenue Service. If you exercise a little patience, chances are you can find a few tax breaks that will help you lower your burden and even increase a refund.
7 Useful Tax Tips:
Since those who live in Chicago apartments are lacking some of the big deductions that can come along with homeownership, it can be even more important to find some hidden breaks. To make the most of your return when filing taxes, follow these tax tips:
1. Carefully review your W-2s and 1099s. Make sure all the statements sent to you and the IRS in regard to setting your tax bracket and liability level are accurate. A single misplaced number can spell disaster. If you spot a problem, report it immediately to your present or former employer and the IRS.
2. Use a tax calculator in advance of filling out forms – This can help you get a rough estimate of your liability and let you see how many tax breaks you really need to find. Tax calculator programs are readily available online.
3. Carefully consider your contributions over the year – When filling out your tax forms, don’t forget any and all charitable contributions. They can add up fast. Even if you only gave a few hundred, it can help reduce your liability.
4. Don’t forget child care expenses – Unless you use a voucher program that involves pre-tax dollars, this can prove to be a huge deduction.
5. Remember energy savings deductions – Even those who live in Chicago apartments can qualify for this kind of deduction. If you drive a hybrid car, for example, you might get a wee bit of a break.
6. Don’t forget gambling losses – Do you play the lottery? Go to the track? If so, your losses can sometimes be tax deductible. Looking into this can save you some money.
7. Consider starting an IRA – This is an instant way to help lessen your tax burden. Putting a few dollars away for your retirement now can save you on the bottom line with the IRS.
6 Commonly Overlooked Deductions and Credits
- Job-related moving expenses, travel costs, uniforms and continuing education costs.
- Monetary donations, charitable contributions and even your mileage to and from your the location where you volunteer.
- Energy efficient home improvements including insulation, exterior window replacement, and central airconditioning
- You actually claim either your state and local income tax or your state and local sales tax.
- Medical Expenses like insurance, prescriptions, and traveling mileage in excess of 7.5% of you income.
- Interest on qualifying student loans.
Lowering tax liability or increasing a return is possible if you know where to look for deductions. You do have to itemize on your tax return to get the benefit of some of these and obviously they must meet all of the requirements to qualify. For details and more information, see your local tax professional.
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