Feb 11th
Tips to increase my tax refund for next year?
- Posted in Taxes Q&A
- Comments 7
I am single & use a standard deduction so what tips do you have for me to lower my tax & increase my federal refund.
I cannot make charitable donations because they only work for itemizing..
I live in las vegas so i dont worry about state tax.
Work less, or send in charitable donations, some states allow you to include your sales, home, and car, but then you have to itemize.
Just tell your employer to withhold an extra $100 per week from your pay. BAM! An extra $5,200 refund next year. Not such a good idea, huh? The goal is not a big refund, but coming as close to $0 when you file.
In your situation there are no tax saving strategies available to you. If you’re OK with the chance of owing up to $100 when you file next year and wish to have as much in your paycheck as possible, claim 2 withholding allowances. If you absolutely, positively don’t want to owe next year, then claim 1 withholding allowance. The down side to that is that your paychecks will be noticeably smaller.
If you can contribute to a 401K, that would help. A traditional IRA is deductible too, but not a Roth and a Roth is very likely a better deal for you.
Why do you want a larger tax refund? That is money you are giving the government without collecting interest the entire year. Why not take that money and save it yourself and collect interest throughout the year?
Contribute to 401K and take advantage of other pre-tax payroll items (ie. cafeteria plans, FSA)
If you are not on the company’s retirement plan, you can contribute to a Traditional IRA account which would be deductible
Also, if you are investing on your own, then seek qualified dividends and long-term capital gains, tax rate is 0% or 15% depending on your income.
As a single man who I assume doesn’t own a home. There isn’t a lot you can do. Buying a home allows you to deduct the loan interest and property taxes. Then you can also claim car tabs, donations, job expenses, but this will cost you more money in the end if you don’t have other reasons to buy a home. You could also adotped a child and then you can claim 2 and be head of house hold instead of single, but a tax savings is not a real good reason to become a parent. Depending on your income, you may also be able to contribute to a qualified retirement account and get a deduction for that.
Given those facts, there is no way to lower your total tax. You can increase your refund by increasing your withholding now.