The April tax deadline is about eight weeks away. So, as you prepare to have your taxes filed, you'll want to make sure you save all of the cash that you can and receive all of the deductions you qualify for.
You'll want to keep in mind some ways to help reduce the amount of taxes you owe this year. Thus, helping you save some cash for retirement.
"We all need to save money for retirement, you know Americans aren't very good savers," said Brooks Mosley, president of Security Ballew in Jackson.
Mosley says anyone making an earned income needs to know about traditional deductible and Roth IRAs. With a traditional deductible IRA, if you're not in a qualified retirement plan and you're under fifty, you can deduct up to $5,000. If you're over fifty, the deduction goes up to $6,000. Now, the scenario changes a bit if you are signed up in a retirement plan.
"If you are a participant in a qualified retirement plan, there's some income limitations on how much can be deductible if any can be deductible at all," said Mosley.
Now, if you don't qualify for a traditional deductible IRA, there's a good chance you're eligible for a Roth IRA.
"A Roth IRA you fund it, you don't get a tax deduction for it, but the beauty of it is when you pull the money out at retirement it's not subject to income tax," said Mosley.
In addition to saving, make sure your tax preparer tells you about all of the refunds you may qualify for. For instance, the earned income tax credit can amount up to $5,700.
"You'll want to make sure that you get those dollars because it could mean the difference between getting a sizeable refund and not having a refund at all," said DeWayne Thomas, an office leader for H&R Block.
To experience less stress when you're preparing to have your taxes filed, make sure you're organized. You want to make sure you put important information like charitable contribution statements and other important tax information into one folder. Organization can save you time and money.
"By bringing it all organized, it reduces the number of hours the tax preparer has to spend therefore it'll reduce their fee that they have to pay," said Mosley.
For information on free tax service, contact the United Way's 211 line.
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