Although tax preparation can be a daunting task, it often results in a substantial payout. Many people rely on this large chunk of cash every year to accomplish important goals, such as making home renovations, paying down debt, or building an emergency fund. Therefore, you want to do whatever you can to minimize your tax liability and boost your refund. Here are a few strategies to accomplish this. 

How to Maximize Your Tax Refund 

1. Review Your Filing Status 

During tax preparation, you must designate a filing status on your return. The options are single, married filing jointly, married filing separately, head of household, and qualified widow(er) with dependent child. Choosing the right status is essential for getting a bigger refund. For instance, it makes sense for some married couples to file separately if one spouse has a great deal of medical or business expenses. This will lower their adjustable gross income and increase the amount they’ll be able to deduct.                                                                                                                                                                                  

2. Know What Credits & Deductions You Qualify For 

The IRS offers numerous tax credits and deductions you can claim to decrease your tax obligations. Credits are subtracted from the amount of taxes you owe while deductions are subtracted from your income. Some of the most common credits and deductions available are the Earned Income Tax Credit, Child Tax Credit, education expenses, mortgage loan interest, student loan interest, and charitable donations. Also, if you’re a teacher, you can deduct education materials and supplies you brought with your own money. 

3. Invest in Your Retirement 

Contributing to a retirement account helps you plan for the future, as well as reduce your taxable income. The government allows each person to apply a certain amount to their retirement accounts annually, and you have time to contribute for the previous year all the way up until the April deadline to file returns. Furthermore, any funds you invest in a traditional IRA or 401(k) may be partially or equally deductible. Setting aside as much as you can for your retirement will ultimately put more money back in your wallet.

No one wants to pay more in taxes than they have to. You can avoid this and even increase the amount you get back with professional tax help from ZP Tax. They offer accurate and efficient tax preparation services that will lay the groundwork for you to secure a sizable refund. Over the years, their knowledgeable staff members have guided numerous Montgomery County, MD, residents through the filing process, providing them with sound advice on limiting their tax obligations throughout the year. Call (301) 587-4829 to schedule a tax preparation service appointment.