Any way to reduce tax owed?

Find and share ways to earn extra cash. No schemes or scams allowed.
Forum rules
No schemes, scams or advertisements allowed -- just legit ways to make extra money.
Post Reply
paguy215
Posts: 1
Joined: Wed Mar 20, 2019 4:01 pm

Any way to reduce tax owed?

Post by paguy215 »

Hello,

I just ran through numbers and it looks like I will owe taxes this year...I expected to owe since I had an early 401k withdrawal and all, so not shocked. However, my tax bill is still pretty high. I currently have an installment plan from 2017 taxes but I don't want to modify that by adding this in, since I'm afraid it could prompt a lock-in letter. I have enough where I can pay it off, but really just *BARELY* enough.

I'm wondering if going to a tax professional might be worth it...like can they find ways to reduce my tax bill that maybe I don't know about? Our taxes are pretty basic...we bought a first home in 2018 but there are no real breaks for that, so we don't itemize...we have a little student loan interest to deduct, as well as small amounts for charity and teacher expenses. So do you think there's something else out there, I should I just bite the bullet and file myself online?

floridacatlover
Posts: 3945
Joined: Fri Aug 28, 2015 7:21 am

Re: Any way to reduce tax owed?

Post by floridacatlover »

I am not a tax expert so take this information with a grain of salt.

But if your income is $55k or below, you can get help from a Volunteer Tax Assistance person. This is a program sponsored by the IRS.

Check here to find a location near you.

https://irs.treasury.gov/freetaxprep/

Personally I would not pay to go to a tax professional in your circumstances.

If you have owed in both 2017 and 2018, be sure to adjust your tax withholding at work.(It sounds, however, that the 401k withdrawal was a one-time thing.)

Just thinking about it, if you used the 401k withdrawal to buy your home, there may be special rules/tax breaks for you using the hardship distribution rule. I cannot post a link so search the IRS website for more details.


Good luck.

Post Reply