CEDAR RAPIDS, IA--(Marketwired - Dec 9, 2015) - It's never too soon to think about taxes or too late to plan for the best outcome. As 2015 comes to a close, TaxAct®, the critically acclaimed leader of affordable digital tax preparation solutions, has compiled a list of five tips to help consumers maximize their deductions before the end of the year. From small business owners and freelancers to multi-income families, all tax filers can benefit from getting ahead of their returns before the new year arrives.
"We understand that filing taxes can be a stressful process, especially when left until the last minute," said TaxAct President JoAnn Kintzel. "It's our mission to serve as a source of year-round support to tax filers of all return types, so we've shared some simple tips taxpayers can take by Dec. 31 to ensure the greatest tax savings and guaranteed maximum refund."
TaxAct's tips for maximizing refunds, including taking advantage of any applicable breaks and navigating new changes, include:
- Give and you shall receive - The holidays are the perfect time to get into the giving spirit. Fortunately, donating cash or assets no later than Dec. 31 can reduce taxable income for those who itemize deductions. Filers should obtain a bank record or receipt from the charitable organization as proof of the donation.
- Evaluate how your health insurance affects your taxes - The Patient Protection and Affordable Care Act (ACA) affect federal income taxes for nearly every American. The tax impact primarily depends on whether an individual has health insurance and from where their insurance is obtained. Taxpayers who have been uninsured for three or more months in 2015 should visit healthcare.gov to see if they qualify for an exemption. Those that qualify should apply as soon as possible in order to avoid a delay of next year's refund. Those who don't qualify for an exemption can get ahead by calculating their 2015 individual shared responsibility payment with TaxAct's Tax Penalty Calculator at HealthcareACT.com.
- Take stock of major life events from the year - While writing your holiday brag letter to family and friends about the year's achievements and major events, make note of the tax implications for each of those occurrences. For instance, purchasing a home, a change in marital status, having a child or a change in employment may have a considerable effect on taxes. Filers can visit www.taxact.com/taxinfo to get a closer look at the impact of these and other life changes.
- Understand the implications of a high household income - If filers have high adjusted gross incomes, they should be prepared that they may not be able to capitalize on all of their itemized deductions due to the Pease provision. Now is a good time for filers to determine what can be done differently next year to place them in a lower tax bracket. Some popular strategies include restraining income below the specified threshold, spreading income out over a number of years or counterbalancing with both above-the-line and itemized deductions.
- Keep tabs on potential tax legislation renewals - The Senate Finance Committee passed a package of 56 temporary tax breaks in July, which will extend the tax breaks through 2016. This stands to benefit big and small businesses, commuters who use public transportation, teachers who spend their own money on classroom supplies and people who live in states without state income taxes. TaxAct will account for these and any other last-minute tax law changes starting in its Final Editions available in early January 2016.
For more helpful tax tips, tools and calculators, visit https://www.taxact.com/. Filers are encouraged to use TaxAct 2015 Preview Editions to get a clear picture of what their federal and state refund or tax liability looks like. TaxAct 2015 Preview Editions are currently available and can be used for tax planning for no charge.
About TaxAct
TaxAct is a leading provider of affordable digital and download tax preparation solutions for individuals, business owners and tax professionals. Its mission is to empower people to navigate the complexities of tax and finance with ease and accuracy at a fair price. The company has long-offered a Price Lock Guarantee on its products, ensuring its customers pay the price listed for their selected product at the time they started their return, no matter when they file. TaxAct was one of the top three visited online tax preparation destinations last tax season.[1] The company has assisted with approximately 60 million e-filed federal returns since 2000. To learn more about TaxAct, a business of Blucora, Inc. (NASDAQ: BCOR), visit www.taxact.com or connect with us on Facebook.com/TaxAct, linkedin.com/company/taxact and twitter.com/taxact.
[1] According to collective week end reports for taxact.com released by Compete Inc.