Although it's obviously very important to file your taxes in a timely manner and pay anything you owe, you want to optimize your return to claim all eligible credits and deductions. Since that can get quite tricky with the wide range that is available, we want to share 6 smart ways to optimize your tax return.
In most cases, pooling itemized deductions are going to have the biggest impact on your return. You can definitely lower your income tax bill by taking as many available deductions as possible over the two percent threshold for adjusted gross income.
There has been a persistent myth floating around for a number of years that taking a deduction related to a home office will trigger an audit. As long as you follow the guidelines related to exclusive business use, that's unlikely to happen. The same is true for deducting mileage. The most important thing is to be accurate with these deductions and to have supporting documentation/logs for all of them.
When people think of deducting charitable donations, they often focus solely on very large donations. However, if you look at everything you donate over the course of a year, it likely adds up to quite a bit. That's why it's important to document and track donations of all sizes. Having this information when tax time arrives will help out a lot.
Another area where you can really optimize your tax return is in regards to what you contribute to retirement. This includes accounts like a Roth IRA or Roth 401(k). Not only are you improving your overall financial health, but these accounts will grow your nest egg in a tax-free way for years to come. If you have an employer who offers any type of matching, try to take full advantage of that opportunity.
As you progress in your financial life, investing becomes more important. While it's great when stocks perform well and you're able to sell for a profit, those amounts do get taxed. One strategy for minimizing the tax implications of capital gains is to offset profits by also selling some holdings for a loss.
If you want to work with an experienced and affordable professional to get your taxes filed, we're here to help. We will ensure that your return is fully optimized and that you're able to take full advantage of all credits & deductions that you're entitled to receive.
For more information, visit us at Alpha Tax or give us a call in Anderson at (513) 832-0026 or in Georgetown at (937) 378-3111.
We're in the middle of the first quarter of the year, which means one of the things you're likely thinking about a lot is getting your taxes filed. And after you finish filing your taxes, you'll probably want to know when to expect your refund this 2018 season.
Understanding the Filing Process
To fully answer this question, let's add a little context. This year, the IRS announced that their first official acceptance date was 1/29. That date was for e-File applications. Not that long ago, the only way to file taxes was by mailing in a return. Then once the IRS received your return, a computer had to scan in all the information. Going even further back, the entry was done manually by an office worker.
Once the return was entered and confirmed, the IRS could mail a refund check back. If that sounds like a long and convoluted process, it's exactly what it was. Fortunately, e-filing has completely changed things. Not only can all tax return information be filed online, but there's now an option for a refund direct deposit.
Factors That Affect Getting Your Refund in 2018
For filers who go with the direct deposit option, it can take as little as eight days to get a refund. Just keep in mind that's if everything is exactly in line and there aren't any credits claimed that require extra time to confirm. The official estimate the IRS gives for receiving a refund is twenty-one days.
There are two main credits that require a hold by the IRS. Those are the EITC and ACTC. Anyone who claimed either credit and filed before 2/15 had their refund held until that date. Most likely, it wasn't released until 2/27.
One thing to keep in mind about filing taxes on your own with the use of the software is even though they may claim to let you submit early, your return isn't actually filed with the IRS until the first date of acceptance, which as previously mentioned was 1/29 this year.
The other issue with using software to file your own taxes is it only takes a single mistake for your return to be automatically rejected by IRS filters and sent back to you. When this happens, a filer has to dig through their return, find their mistake and submit again. That can easily delay how long it takes to get a refund.
If you want to work with an experienced and affordable professional to get your taxes filed as soon as possible, we're here to help. We provide an instant $50 check when you file with us. And we can also provide a refund advance of up to $2500. For more information, give us a call in Anderson at (513) 832-0026 or in Georgetown at (937) 378-3111. You can always visit Alpha Tax online too!