As the end of the year approaches, it’s essential to take a few final steps to ensure you’re maximizing your tax savings. By making smart moves now, you can reduce your taxable income and set yourself up for success in the next tax season. Here are three tips that could save you hundreds, if not thousands, on your taxes.
Maximize Retirement Contributions
Contributing to a retirement account is one of the best ways to lower your taxable income. If you haven’t maxed out your IRA or 401(k) contributions yet, you still have time. The IRS allows you to contribute up to $6,500 per year to an IRA, and if you’re over 50, that limit increases to $7,500. Not only are you securing your financial future, but you’re also reducing your taxable income, which can lead to significant savings on your tax bill.
Deduct Business Expenses
Are you a small business owner? Make sure you’re tracking every deductible expense. Office supplies, business meals, travel, and even a portion of your home if you have a home office can all be deducted from your taxable income. Keep a detailed record of all receipts and expenses. These deductions can add up quickly, giving you more money to reinvest in your business or save for the future.
Claim Energy-Efficient Tax Credits
If you’ve made energy-efficient improvements to your home or business—such as installing solar panels, upgrading insulation, or purchasing energy-efficient appliances—you may qualify for energy credits. These credits directly reduce your tax bill, making them more valuable than a standard deduction. Be sure to check the IRS guidelines to see if your improvements qualify.
These tips are just the beginning. Tax planning is a year-round process, and the more prepared you are now, the better your outcome during tax season. If you’re unsure where to start or need personalized advice, feel free to schedule a free consultation with us. We’re here to help you save as much as possible before December 31.
Contact us today to get started on your year-end tax planning!