4 Accountant-Approved Tips to Reduce Your Tax Bill
When it's time to file income tax returns, the fear of paying a tax bill causes some people to procrastinate or not file at all. The encouraging news is there are a number of ways to reduce taxable income. As the area's premier accountant, Joe Heard, CPA in Checotah, OK, continues to assist individuals and business owners identify money-saving credits and deductions. Here, he shares several strategies.
4 Ways to Lower Your Tax Bill
1. Use a Health Savings Account
Many companies now offer health savings accounts (HSA) to employees who want an additional source to cover medical expenses. The HSA is ideal for those who have a high deductible with their current health plan. Each year participants can contribute certain amounts to an HSA to pay for prescriptions, vision care, and other expenses. One of the key benefits is if the contributions aren't used up by year-end, you could roll them over to the following year without any tax assessments.
2. Boost Your Retirement Fund
Another strategy to minimize your taxable income is retirement plan contributions. Because the maximum contribution amounts vary each year, talk with a certified public accountant to find out the most current limits. All contributions to retirement plans such as a 401(k) are not included in the filer's taxable income, which can ultimately lower or eliminate tax debt.
3. Ask About Employer Education Assistance
Some companies will offer tuition assistance to employees who want to take college courses. The amount typically ranges up to $5,250 each year without any tax assessments. Essentially, the employer pays for the courses and the amount covered is not included in the employee's salary on their W-2 form. 4. Be Careful With Business Structures
Depending on the type of business structures you choose, the result could impact your taxable income. The most common types are limited liability company (LLC), sole proprietorship, C-corporation, and sub-chapter S corporation. Each model has different tax implications. If you're preparing to launch a business and aren’t sure which type to choose, consult an accountant for guidance.
To learn more about reducing your taxable income, contact Joe Heard, CPA. This accountant specializes in providing customized tax return preparation and accounting services for both individuals and business owners. To learn more or to schedule an appointment, call (918) 473-1492. Visit the website for more information on the firm's range of services.
About the Business
BUSINESS
Accountant
Joe Heard, CPA
711 SW 1st St, Checotah, OK 74426
CALL US+1 (918) 473-1492
CALL US+1 (918) 473-1492
