While you need to start thinking about preparing your 2014 taxes, you also need to shift your thinking to the next year. Since you have a fresh start, you want to try and implement some of the following tips to try and reduce next year’s taxable income.
- Buy things you need last minute. Buying at the very end of the year is a good way to take advantage of deductions. However, don’t buy unless you really need it. Spending money is still spending money!
- Give, give, give. Not only do charitable donations represent one of the best ways to cut down your tax bill, but they also help other people and make you feel better about yourself. Just remember that your volunteering time doesn’t count.
- Maximize home office deductions. You can take a deduction of $5 per square foot on your home office. You are able to do this up to 300 square feet. Make sure though that your home office really is exactly that. You have to be able to prove it if you should ever be audited!