When Tax Day comes, will you be ready? April 17 is fast approaching, and while filling out all those forms can be a real slog, there is no reason why, even if it’s down to the wire — no judgment, we’ve all been there — you can’t make your taxes work for you and save you some money.
Jeff Rose, the CEO and founder of Alliance Wealth Management, shared his top three last minute tips with Entrepreneur.
1. Fund an individual retirement account (IRA).
Remember that you have until April 15 to make a contribution that will reduce your taxes for 2017. If you’re married, you can also file an IRA for your spouse. “If your spouse doesn’t hold a job outside the home, he or she can qualify for a full IRA contribution and deduction,” Rose says. “Both you and your spouse can contribute up to $5,500 each, or $6,500 each as long as one has sufficient earned income to cover both contributions.”
2. Fund a health savings account (HSA).
This is an account that is similar to an IRA in that you can make a tax-deductible contribution by April 15 for 2017. “The limit is $3,400 for an individual, and $6,750 for a couple or family,” Rose says. “There’s also a $1,000 catch-up contribution if you’re age 55 or older.”
3. Adjust your withholding.
As we head into tax day, Rose suggests making sure that your withholding taxes are as closely aligned as possible with your liability — the amount of taxation an individual or business has to pay based on the current laws. “If you don’t pay enough, you’ll owe a big tax bill next year,” he says. “But if you over-withhold, you’re giving the government free use of your money for up to one year.