Spring is a charming and lovely season for the kids but for adults, not so much. Every spring time, adults wrestle with tax filings, refunds, credits, and audits. A large amount of people’s income goes to tax every year but they can reclaim it. For taxpayers, that’s probably the best part of paying taxes. However, not all taxpayers get equal amount of tax returns especially if you are a seafarer or work on a yacht. The tax laws for offshore residents are entirely different from onshore residents and you may need to consult with maritime tax accountants for your situation. Regardless, here are some tips you can use to get the most out of your tax return this year.
Itemize your Deductions
A great way to increase your tax return is to itemize certain expenses and deductions from the total amount of tax. A few examples of expenses you can itemize are casualty loss, charitable contributions, unreimbursed business and medical expenses, job search expenses, state and local sales tax deductions and mortgage interest, etc. The taxman will consider these expenses and the conditions surrounding them before they can include these expenses in your tax return.
Get a deduction for Relative Support
If you have been supporting a friend or a relative financially for the past year, then you can get a dependent exemption. The dependent exemption includes the amount of money you spent on supporting the relative or friend. You will have to file for this deduction separately from your tax returns. Although, a few rules apply but you can generally increase the amount of your tax return with dependent exemption.
Refundable Tax Credit
Tax credits are dollar for dollar value of the tax you owe and are probably the best way to get the most out of your tax refunds. These tax credits include earned income, child and spouse support credits, education, retirement as well as dependent care credits. Make sure to file for the right claims at the right time and you can get extra tax credits in addition to the tax refund. Refundable tax credits are even better than itemizing the expenses and get you more tax returns.
Add to your Retirement Savings
Another great way to increase your tax returns is to contribute to your retirements account. The government can give you additional rewards if you saved for your retirement over the past year. You can benefit from the Saver’s Credit that allows you’re at least thousand dollars as tax return. This is especially advantageous for seafarers and yacht crew members that work most of their lives on board without having concrete retirement plans. Make sure to consult with your marine tax accountants before taking this step.
The Earlier you File the Better
It is better to file for the tax returns as early in the session as possible. You will be able to get more tax returns if you have adequate time to discuss your case with the tax accountants. Gather all the necessary form and documents and use an online platform for filing, which is relatively faster than going to the local tax office.