The information in this article is up to date for tax year 2024 (returns filed in 2025).
Wondering how to get a bigger tax refund? You’re not alone! Knowing how to maximize your tax return is key to keeping more money in your pocket. One of the best ways to achieve this is by taking full advantage of money-saving tax credits and deductions. But there are also other strategies to help you get a bigger tax refund. Here’s how you can maximize your refund and ensure you’re not paying more than you owe.
Understand Your Tax Situation
Understanding your tax situation is the first step to maximizing your tax return. Your tax situation depends on various factors, including your filing status, income, deductions, and credits. These elements directly impact your tax liability and refund amount. For instance, your filing status can affect your standard deduction and eligibility for certain tax credits, while your income level can influence the amount of tax you owe and the deductions you can claim. A clear picture of your tax situation is essential for maximizing your tax refund.
Maximize Your IRA Contributions
A traditional IRA is a great way save for your golden years and potentially save on your taxes. Traditional IRAs are funded with pre-tax dollars. This means you can deduct your contributions from your taxable income, and your earnings grow tax-deferred until you start taking withdrawals in retirement. Traditional IRAs allow for tax deductible contributions, which can reduce your taxable income. You have until the tax filing deadline to open or make contributions to an IRA. Aim to make the maximum contribution and don’t forget that if you’re at least 50 years old, you can also make an additional catch-up contribution.
Contribute to a Health Savings Account (HSA)
If you’re currently enrolled in a High Deductible Health Plan (HDHP), consider opening a Health Savings Account (HSA). Since your contributions are tax deductible, they can lower your taxable income, and you won’t pay federal taxes on the money you put in, saving you money on your taxes. Your withdrawals for qualified medical expenses are also tax-free. These accounts offer triple tax benefits, making them a smart strategy for how to get a bigger tax refund, especially when paired with your overall tax strategy. HSA funds don’t expire and can be used to pay for deductibles, copays, coinsurance, and other expenses. The HSA contribution deadline aligns with the tax filing deadline, so there’s still time to contribute!
Reconsider Your Filing Status
Your filing status is important because it determines your filing requirements, standard deduction, and which credits you’re eligible for, all of which impact your tax returns. If you got married, divorced, or experienced some other major life change, it’s a good idea to reconsider your filing status. Remember, your marital status on December 31st determines the filing status you’ll use on your return. So, even if you got hitched in December, the IRS considers you married for the entire year and you can file a joint return with your spouse. It’s also worth noting that single parents can benefit more by filing head of household versus single because the standard deduction is higher. A simple change in your filing status can potentially maximize your tax refund and save you thousands. ezTaxReturn helps you choose the best filing status for your situation, ensuring you get your biggest possible refund.
Know Which Receipts Are Worth Keeping
One of the easiest ways to maximize your tax refund is by keeping track of all the receipts that could help you save money, especially if you plan to itemize. Generally, you want to keep anything related to your income, medical expenses, childcare bills, home, and charitable contributions. For a full list of everything that can save you time and money on your return, check out our tax prep checklist. Keeping these documents organized ensures you don’t miss out on any opportunities to maximize your tax refund.
Claim Your Tax Credits
The IRS offers a bunch of tax credits you can claim to reduce the amount of taxes you owe and maximize your refund. Some of the most popular ones are:
- Earned Income Tax Credit (EITC) – The EITC was created to help working families with low to moderate incomes. The maximum credit amount varies depending on your family size, but it is potentially worth up to $7,830 for tax year 2024.
- Child Tax Credit – The credit is worth $2,000 per qualifying child under the age of 17.
- Child and Dependent Care Credit – You may qualify for the credit if you paid someone to watch your dependent while you went to work. For tax year 2024, you can claim up to $3,000 of expenses for one qualifying person and $6,000 for two or more qualifying people. The credit amount is a percentage of your care expenses. The percentage is based on your adjusted gross income.
Using ezTaxReturn ensures you don’t miss any tax credits you’re eligible for, helping you maximize your refund.
Don’t Overlook Tax Deductions
Tax deductions reduce your income before taxes are calculated. Taxpayers have the option of choosing the standard deduction or itemizing. For tax year 2024, the standard deduction is $14,600 for single taxpayers and married couples filing separately, $21,900 for head of household and $29,200 for married couples filing jointly. If your deductible expenses are more than the standard deduction, it makes more sense to itemize. Allowable expenses include:
- State and local taxes
- Gambling losses
- Home mortgage interest
- Medical and dental expenses (above 7.5% of your adjusted gross income)
Tax deductible contributions to retirement accounts, health savings accounts, and charitable donations can lower your taxable income and potentially lead to a larger tax refund.
ezTaxReturn will compare your standard deduction versus itemized deductions, ensuring you choose the option that maximizes your tax return.
Adjust Withholding to Minimize Tax Liability
Adjusting your withholding can help minimize your tax liability and increase your tax refund. If you’re having too much tax withheld from your paycheck, you may be giving the government an interest-free loan. Conversely, if you’re not having enough tax withheld, you could face a large tax bill when you file your tax return.
To avoid these scenarios, it’s important to find the right balance. The IRS’ Tax Withholding Estimator tool is a valuable resource that can help you determine the correct amount of tax to withhold from your paycheck. By adjusting your withholding appropriately, you can ensure that you’re not overpaying or underpaying your taxes throughout the year, ultimately leading to a more favorable tax refund.
Use Tax Preparation Software to Maximize Your Return
Filing your taxes with easy-to-use tax preparation software like ezTaxReturn can help you maximize your refund and minimize your stress. You can quickly find all the deductions and credits you’re eligible for, and avoid common mistakes that might lead to higher bills or missed savings. ezTaxReturn is designed to guide you step by step, making tax season easier and ensuring you get the biggest refund possible—without the need for a tax professional. Just enter your information, and let the software do the rest!
The articles and content published on this blog are provided for informational purposes only. The information presented is not intended to be, and should not be taken as, legal, financial, or professional advice. Readers are advised to seek appropriate professional guidance and conduct their own due diligence before making any decisions based on the information provided.
