Everyone who pays tax knows that it is not very easy to give a chunk out of your hard earned money to the government when you might have a lot of different money problems that require your attention. At that time each and every one of us tries to find a way that we could save some on taxes. Well, yes it is important to pay taxes but what is the point of overpaying it? There are some ways for saving on taxes that can help you save some money and pay for the necessities of your life.
Child and dependent care credit:
This is the one very important tax credit that can help you accrue at least $3000 of one person or child. You can get this credit if you are paying someone for babysitting or taking care of your ill spouse or dependent. This means all you have to do is give a proof that you are paying out the certain amount of money while you are working or not in a position to take care yourselves.
Child tax credit:
The child tax credit is nothing like care credit; this credit is for every parent who has a child and for them they can get at least $1000 for a child under 17 years of age.
Earned income tax credit:
This tax credit is mainly for the taxpayers who are low or moderate income earners. These people if holding down the job or are self-employed they can file for the earned income tax credit. But, the very important thing is that the person who is applying for this credit needs to have some income whether it is in the form of wages or self-employment. The credit though differs from person to person depending on the number of dependents, their income and most importantly the age of the taxpayer.
Savers credit:
The most popular credit is the saver’s credit. Everyone who is working with the establishment that offers 401K that is retirement savings gets to save a certain amount on taxes as the percentage saved for 401K is deducted before the taxes are paid.
Education credits:
If you are a student then you are in for a treat for the tax break, there are three different credits or deductions that are targeted towards the students:
American Opportunity Tax Credit is for the first four years of the college
Lifetime Learning Credit is for the student who is getting the higher education that is working towards postgraduate or the ones who are going to college for more than four years.
If either of the above is not covering you, then the tuition and fees deductions are meant for you.
These are the best ones for the students so that they can get a little bit of a break while they are paying for the expensive colleges and also working alongside the education.
Job search deduction:
The one type of credit that not many people are aware is the job search credit; this is for those people who are looking for a job in their career field. If you are looking to dabble in any other field, then it would not be possible for you to get this deduction. But for many, it is a relief that they would love to take benefit of.
Energy saving credits:
Environmental awareness has made a way to the tax laws, and now people who have renewable energy sources such as wind power or solar energy sources are entitled to get the tax break that they deserve and save the money and also environment while they are at it.
Charitable credits:
The very important of the tax savings that many big businesses take a benefit of is charity credit. Just keep the receipts of all the charities you make every year and when filing taxes make sure to produce them as a proof. This will show that you are improving your society as you go and this means a little bit of tax break for you that we all can use here and there.
With all this information you now know how to have some of the tax savings it is time for you to make some changes in your tax forms.
