7 Tips to Get Bigger Tax Refund for Your 2017 Tax Year!

7 Tips to Get Bigger Tax Refund for Your 2017 Tax Year!

7 Tips to Get Bigger Tax Refund for Your 2017 Tax Year!

Most of us consider tax season to be a burden that should somehow just vanish from the calendar. But there are enough statics and data showing that more than 80% people who file for tax returns receive refunds. And the average refund is about $3000. Here are a few effective ways to boost that tax refund even further up.

Proper utilization of Deductions

Most of us do opt for the standard deductions. But if you itemize your deductions and take lots of them, there are chances of higher refunds. If you haven’t already done that, now is probably the best time to do that. But if you have been through that and don’t see any deductions at hand, see if you can prepone some deductions. That donation you had planned for later in the year, do it within the tax season. This will allow you to claim that for tax refund. There are several deductions that might be applicable for you,

Retirement Planning

Funding your retirement with the help of IRA and/or 401(K) allows for bigger tax deductions from your income. This results in lower tax and also higher refunds. Though there is nothing wrong with traditional methods, there is an alternative in the form of Roth IRA and Roth 401(K). Though you do not stand to benefit from immediate tax benefits of bigger refunds, you do get a chance to withdraw retirement funds as tax-free.

Make the most of mortgage

With the constant fluctuations in the interest rates, refinancing your mortgage can turn out to be a good option. In the initial days of your mortgage repayment, majority of your installments goes in as interest. Look for options that will help you reduce the interest rate. It becomes a win-win situation for you, as you can look for better tax benefits and lower interest rates.

W4 Form

Filling up of the W4 form during job initiation is quite a familiar scene. The calculation for amount to be withheld for tax depends on what you fill the W4 with. Higher the claims you make, lower will be the withheld amount. You do get the flexibility of choosing your claims and also updating the form at different times. For a bigger tax refund, claim lower allowances up front and update the W4 form later on to your finance department.

Filing Status

The amount of your tax refund depends on your filing status as well. You should not select the filing status based on assumptions alone. Certain filing statuses allow for much better tax rates and thus higher deductions. For example, single parents or individuals who support dependents qualify for Head of household, which has favorable tax benefits. Similarly assess your situation if you are married. Filing tax returns together or separately would have their own pros and cons. Filing it together leads to higher tax refunds, but it largely depends on your case.

Work from home benefits

If you are someone who works from home a lot, there are bunch of ways to get bigger tax refunds. If you have a dedicated place in your house for work, you can claim up to a quarter of the annual rent. Along with it utility bills, other expenses such as office supplies, travels, advertising costs etc. would also qualify for tax deductions.

Utilizing the credits

Earned income tax credit is a great way for increasing the tax refunds. In fact, they work more efficiently than deductions. It is worth taking sometime to see if you are eligible and can include the same.  Every credit dollar that you earn helps in bringing down the taxes by one dollar.

A tax refund has the capability of doubling up as a saving scheme. If you haven’t been able to save much during a financial year, optimizing your tax returns can help you get a fat refund. Once you have that refund, you can utilize it for investing or for anything else as well.

3 Quick Tips to know your Tax Refund – Absolutely Free!

3 Quick Tips to know your Tax Refund – Absolutely Free!

3 Quick Tips to know your Tax Refund – Absolutely Free!

If you happen to pay more taxes than you owe, tax returns can help you get them back. But it can be pretty frustrating if you have no idea when and how that is going to happen. Luckily there are ways that can help you to know the exact status of your tax refunds. You can use these methods for determining federal or state taxes and the status of your refunds.

1. Federal tax status online

Though we expect everything to happen at supersonic speeds, there are certain things that take their own sweet time.

If you have filed your tax returns online, give IRS at least 72 hours before you start checking the status.

The duration increases to about 3 or 4 weeks if you mail your tax return.

When you have waited for the minimum time window, make sure you have your tax return copy with you. The IRS website would ask you some basic questions such as your social security number, status while filing returns and exact dollar value that you expect as returns. The tax return file contains this information.

On filling up the above details and selecting the tool “where’s my refund?” you can expect either of the following responses. Your return is under processing, inferring you have to wait for some more time. It can also give the date when you can expect your returns to arrive. And incorrect address resulting in the refund not delivered. Updating the address takes care of the issue.

2. Federal tax status over phone

If you are not tech savvy you can call the toll free IRS numbers to get information regarding your tax returns. If you call at 800-829-1954, you can query for tax refunds. But if you need to know the status of your tax refunds and also your tax related information, you can call 800-829-4477.

Just like the IRS website, for checking status over phone also you would need information present in the tax return.

Kindly have your social security number, status while filing the taxes and exact refund amount mentioned on the tax return, with you while checking the status.

Alternatively you can use mobile based applications to check the same. Just like any other mode, you need to provide some basic information. But the advantage with the mobile app is that you can save these information for later usage.

3. State tax status

Not all the states collect state level income tax. States like Alaska, Florida, Nevada, Texas, Wyoming and South Dakota do not charge income tax. For these states, there are no state level tax refunds.

Each state differs in the way they present the tax information to their citizens. To get hold of that, you need to visit the state’s tax division on their website and get the relevant information. Alternatively, the websites usually offer a phone number of representatives, should you have any questions.

Another aspect in which the state and federal taxes differ is the information required by each. Keeping your tax return handy would help you get through this phase.

Some of the most common data set required is the social security number, along with the exact refund amount outlined in the tax return.

Both the federal and state tax laws and processes differ a bit. Thus you must give them the minimum time frame required before looking for return status. Each of them supports various methods of gathering information, which can be extremely helpful for the citizens. If you do not receive your returns within the stipulated timeframe, the best approach is to reach out to IRS.