It’s never too early to start thinking about taxes, especially when tax moves you make right now could save you cash in the New Year. To help taxpayers gain a better understanding of tax savvy moves to make before Dec. 31, 2010, Bob Meighan, CPA and VP of TurboTax, recently released a new video (To learn more about maximizing your refund for 2010, view Bob Meighan’s video here: https://www.youtube.com/watch?v=eomiSFIRo0U) providing tips for taking advantage of end-of-year tax deductions and credits.
According to tax expert, Bob Meighan, the following are smart tax moves taxpayers can make before year’s end to maximize their refunds:
• Invest in making your home more energy efficient – Spend money to insulate your home, replace drafty windows, replace creaky old furnaces and water heaters or install residential solar, wind turbine systems or geothermal heat pumps to slash your energy bill now and increase your refund at tax time. You could be eligible for up to $1500 federal tax credits for investing in these energy savings.
• Give back - Donating to qualified charities helps those in need and can increase your tax refund. Obviously you can get a tax write-off for cash contributions, but don’t overlook donations like clothing, furniture, toys and bikes. Even the miles driven to and from volunteering can be deductible. Remember to keep receipts and documentation for all donations. There are free ways to find out how much your items are worth: visit ItsDeductible.com. Keep track of donated items here so it’s easier come tax time. Visit IRS.gov to make sure your chosen charity qualifies.
• Invest in your retirement plan – Investing in your 401k or IRA can increase your tax refund and fund a more comfortable retirement nest egg – tax free. Contributing to retirement accounts before the end of the year will decrease taxable income, boosting this year’s refund.
• Use tax software or go online – Despite pending tax law changes, taxpayers using tax software or going online can be confident that tax software will be updated when they are ready to file. Also, most of the pending tax legislation applies to 2011 and beyond. Very few of the pending tax bills affect one's 2010 tax return.
• Ask questions - If you have questions on deductions and credits, there is still time to get free answers to your questions. Visit freetaxquestion.com to have a tax expert call you back with a free answer between now and the end of January 2011.
Bob Meighan, CPA and VP of TurboTax, is the past chairman and current member of the Electronic Tax Administration Advisory Committee. He joined Intuit in September 1991 and served most recently as vice president and general manager of the consumer tax group. Prior to joining Intuit, Mr. Meighan spent 11 years with the 'Big 6' accounting and consulting firm, Price Waterhouse, where he served as a senior manager in the advanced technology group. Because of his extensive tax knowledge, Meighan has been featured on ABC News, Fox, CNBC, CNN, Bloomberg Radio, and countless local and national television and radio programs, as well as contributing tax tips and information to the Wall Street Journal and New York Times.
To learn more about maximizing your refund for 2010, view Bob Meighan’s video here: https://www.youtube.com/watch?v=eomiSFIRo0U.