Tips to Combat Smaller Tax Returns

Employees eagerly await tax season. Why? Because that’s when they get their tax refund! This year, workers have been eagerly filing their taxes only to find that they received less money than last year.

Employees eagerly await tax season. Why? Because that’s when they get their tax refund! This year, workers have been eagerly filing their taxes only to find that they received less money than last year. But why? Well, if you remember, 2017 was the year that mandated a tax reform. Tax reforms are supposed to be beneficial. The goal of tax reform is to save money. What changed this year? Payroll comes into play. The amount of money withheld from your paycheck adjusted to match the projected tax amount. Fewer funds coming out of your paycheck decreases your tax refund. Keep reading for tips on how to offset smaller tax returns.

Invest in a Savings

Saving money can be hard. Bills prevent money saving. Still, discipline is needed. Saving even a small amount of money each paycheck will help. You’ll be happy to discover that during tax season, funds won’t look so low because they were there all along.

Do Monthly Checkups

Waiting until the last minute to assess your income can be stressful. Let’s say you’re a small business owner. You have a lot more to account for than an individual just filing taxes. It may be helpful to consult with one of our professionals each month who offer tax and accounting services. Doing a monthly check-up and reassessing what your return might be each chance you get, will prevent surprises. Make sure to check your paycheck each month as well to discover what payroll adjustments may have taken place.

Create monthly budgets for yourself as well. Can you think of something that you spend money on each day? You may find that lessening this specific purchase intake could help you put more money into a 401K retirement plan or a 529 college plan for your child.

Discuss Income With Your Spouse

Are you married?  Do you and your spouse both work? Two incomes can bring financial stability into a household. However, earning a high amount of money without also taking more deductions can even cause you and your spouse to owe in taxes. Did you or your spouse start a new job? Has one of you been promoted recently? Make sure to account for life changes that can affect your withholdings.

Track Transactions and Receipts

It’s a tough task to keep track of all the bills you’ve paid. However, this will help majorly. Small business owners can plan out deductions. Log any rent payments or mileage used in your company car. Do you donate each year to several charities? Charitable donations can be used for a tax write-off as well. You’d be surprised at all the ways that you can earn more money.

Next year will prove to be a better season if you follow these tips. You work hard and deserve to be financially secure.

PL Consulting Can Help You Plan Your Budget!

PL Consulting offers a diverse range of bookkeeping and other financial services. Each of our services is customized to fit the needs of our client and his or her business plan. Our team can help you with each step of your business from organization, to budget, to financial maintenance.  We are located in Pikesville at 119 Old Court Rd Baltimore, MD 21208. Contact us at 410.764.3731 or info@www.plcfo.com so that we can assist you with your bookkeeping needs. Remember to stay up to date with everything PL Consulting by following us on our social media platforms via Facebook, Twitter, and LinkedIn.

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