Donate To Charitable Cause – Donating to Charity is a good way to reduce your taxes. You can write off charitable contributions if you itemize your deductions. When calculating the total charitable contributions, don’t forget gifts of cash, appreciated stocks or non-cash donations. Ideally, you can include even the mileage for transportation to do charity work or the amount of money you spent on preparing meals for the charity.
Strategies for the Self-Employed – If you are self-employed or doing some side projects for extra income, you are eligible for a lot of tax deductions. This can be from expenses related to shipping, advertising, business-related vehicle mileage, website fees, percentage of internet charges used for business, office supplies, business related travel, and any other expenses incurred to run your business.
Home Office – If you work from home, you can also get a deduction by declaring a portion of your house space as your office.
Tax Credits Are Gold – Take advantage of tax credits as much as you can. You can go to college and earn tax credits, invest in IRAs, you can take child tax credits, earned income credit, American opportunity credit, lifetime learning credit and a lot more. Tax credits are powerful since it is being deducted directly to the total tax owed. So if you have a credit worth $5000, you can slash that off of your tax bill. At times, tax credits can even cause you to get a tax refund.
Use Health Spending Accounts – Health Spending Accounts allow you to spend your tax free money for medical expenses. There are many health spending accounts programs that you can choose from. This is an opportunity you shouldn’t miss since it is inevitable to have some medical expenses.
Hire a Professional – Associates at BC Tax have years of professional experience and case knowledge to use at your disposal. Please contact BC Tax for additional information on what can be done to reduce your liability.