As April 15 draws near, many Americans are searching for ways to maximize their federal tax refunds.
Knowing how critical it is for families to make every dollar count, University of Florida associate professor Michael Gutter, who specializes in family finances, offers 10 tips to saving time and money this tax season. His advice includes:
- Make use of a volunteer income tax assistance site that provides reliable, free tax assistance service to people whose taxes aren't terribly complicated and whose income is under $51,000.
- Keep organized records and take advantage of applicable deductions and credits, such as those for education, child care, home purchase expenses and charity contributions.
- Remember that a number of tax credits are relevant for people with kids, including those with children in college or who are paying for private school.
- Check eligibility for the Earned Income Tax Credit, which is a credit for low-income workers.
- Use Form 8888 to have the IRS deposit any refund into a savings account, IRA or equally safe place where it cannot be spent easily on impulse purchases.
- Amend previous years' returns if there was a missed deduction or credit you were eligible for.
- Except in cases of financial emergencies, avoid tax refund anticipation loans and the fees, or interest, that accompanies them.
- Realize that tax-deductible IRA contributions for the previous year can be made up until tax filing day in April.
- For those receiving a tax refund, don’t delay filing a return. The sooner the refund is received, the sooner that money could be in an interest bearing account.
- Be truthful and make sure to request an extension if the return can't be filed by April 15.