Death and taxes. The two things people commonly refer to as being inevitable parts of life and understanding the reasoning behind each can often be difficult. However, there are a few ways to lessen the burden of the latter and those who are able to take advantage of some potential deductions, credits, or both can lower their current tax imprint. No matter your filing status, ensure you have counted on each of these potential devices in order to pay exactly what may be owed and nothing more.
The standard deduction has been raised significantly in recent years, advocating for even more individuals and couples who are filing to utilize this measure. Doing so not only reduces the amount of paperwork individuals need to keep up with throughout the calendar year but also serves to benefit a majority of Americans. While there are a few instances where itemizing a return can be helpful, given the timely increases, most of those who are filing will be better served by administering these preset amounts.
Tax deductions are a way to lower the overall amount of income for which taxes are due. Common tax deductions include charitable contributions, medical or long-term care expenses, property taxes, and contributions toward a retirement fund.
These deductions are used to lower the amount of taxable income which is reported and are seemingly opposite of credits by the manner to which they are applied.
Tax credits are amounts which may apply directly to your refund depending on type. There are both refundable tax credit applications and those which are regulated as non-refundable. The difference here is refundable credits can actually increase an individual’s refund, whereas those of the non-refundable variety may only serve to decrease a person's tax liabilities.
Common credits include the Earned Income Tax Credit and Child Tax Credit, which both qualify as refundable options. Some non-refundable credits which may apply to certain individual returns include an Adoption, Lifelong Learning, or Mortgage Interest credits - among others which may be applied in conjunction or as a stand alone item. While these particular adjustments may not result in a sizable refund, they still help to reduce the tax liability of those individuals who qualify for their use.
If you’re ready to file a return or need help determining exactly which potential credits and deductions may apply to your given situation, then let the tax professionals at Bloch Rothman and Associates
assist you today. In addition to providing answers to your deduction or credit tax questions, they can also take care of multiple other issues dealing with paying or owing back taxes, required audits signaled by either the IRS or an outside agency, or any other personal or corporate wealth management issues. Along with providing a quality tax service, our group can also complete all types of returns or answer any other factors associated with financial issues or concerns you may have. Serving Denver and all of the surrounding areas for 35 years, our firm has an extensive history in helping clients with any and all of their tax issues or dealings with the Internal Revenue Service. If you have questions about your personal, business, estate, or any other filings, don’t hesitate to contact us today. Available for all of your tax needs, there are also a number of bookkeeping and payroll services offered to assist you and your business. We look forward to meeting you and providing the type of service you can rely on whatever your needs may be very soon!