February is already here, which means that the tax deadline is drawing closer. There’s still plenty of time to file your taxes—the deadline is April 18th this year—but getting an early jump on them is never a bad thing. And with the apparent new tax laws coming in from Washington sometime soon, it’s a great idea on focusing your efforts on cutting your tax bill as much as you can for 2016. And according to a report from Time, TurboTax CPA Lisa Greene-Lewis states, “There are still plenty of last-minute moves people can make.”
If your occupational situation changed last year, whether it be bad or good, it might be in your best interest to reclaim a social security overpayment. In the same Time report, H&R Block Tax Institute Director Gil Charney states that if you changed jobs last year, with a combined income of over $118,500, you overpaid Social Security Tax. You could also save on any schooling that you’ve done last year with the Lifetime Learning Credit. The LLC can reduce your bill by up to $2,000 for single filers if your income didn’t exceed $65,000 or $131,000 for joint filers.
For any college graduates who are new to their respective fields, you have many tax breaks at your disposal. One such break is student loan interest deductions. If you can’t be claimed as a dependent, the loans are in your name and your income didn’t exceed $80,000 last year, a potential $2,500 can be deducted from you bill. Or, if you are currently paying for college, there are avenues that can help alleviate your bills. For example, the American Opportunity Tax Credit (AOTC) is a great break, even more so than the Lifetime Learning Credit. If you earn less than $90,000, you could potentially save $2,500. Unfortunately, only the first four years of an undergraduate degree can qualify. Other than that, it’s amazing break.
Other large scale life events that are non work or occupation related could also prove as a potential boon for your bill. The birth of a child is one way to get a nice little tax break. As long as the child has a social security number or taxpayer identification number, you can claim a child tax credit of up to $1,000 per child, as well as an exemption for your bundle of joy. Or, if you’ve recently divorced, claim yourself as the “head of household.”
These are just a few of the dozens of ways to cut your tax bill for last year. For the full list, visit the original Time article here.