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WASHINGTON, D.C. – As the April 15 deadline looms, millions of taxpayers are rushing to file their returns, hoping to avoid penalties and maximize savings. According to the IRS, nearly 18 million people wait until the final week to submit their forms, leaving little time to get organized. However, financial experts are urging taxpayers to take a few simple steps that can make a big difference, even at the last minute.
Financial experts emphasized the importance of organization. “Being organized is key to ensuring you don’t miss any opportunities. Set up a folder—either physical or digital—where you can store all of your key tax documents, such as 1099s, W-2s, and 1099-Rs,”they advise. This simple step can save precious time and reduce the risk of missing deductions or credits that could maximize your refund.
Last-Minute Moves to Maximize Tax Savings
- Maximize IRA Contributions: If you have an IRA, now is the time to contribute before the April 15 deadline. These contributions may reduce your taxable income and increase your refund.
- Tax Loss Harvesting: Review your taxable investment accounts for underperforming assets. Selling these can offset gains and lower your taxable income, a strategy known as tax loss harvesting.
- Claim Available Tax Credits: Don’t overlook credits such as the Electric Vehicle (EV) tax credit, home energy-efficient credit, or childcare tax credits. These can provide substantial savings, especially if you haven’t yet applied for them.
- Plan for Next Year’s Taxes: If you owe money, it’s wise to start making estimated quarterly payments for the next tax year to avoid interest or penalties.
IRS Extension: What You Need to Know
If you’re not ready to file by the deadline, you can request a six-month extension. However, keep in mind that an extension only gives you more time to file, not to pay. Payments are still due on April 15 to avoid penalties and interest.
2024 Tax Changes: New Inflation-Adjusted Brackets
For the 2024 tax year, taxpayers will benefit from inflation-adjusted tax brackets and higher standard deductions. The standard deduction for single filers is $14,600, and $29,200 for married couples filing jointly. This change is expected to provide relief for millions of Americans, with around 90% of filers opting for the standard deduction.
E-Filing: The Fastest and Safest Option
Experts continue to recommend e-filing as the fastest and most secure way to submit your tax return. E-filing not only speeds up the process but also reduces the likelihood of errors, helping you avoid costly mistakes that could delay your refund or result in penalties.
With the deadline fast approaching, these last-minute tips can help you maximize your savings and avoid the stress of scrambling at the last minute.
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