Finance & Insurance · PromosPro US News

If You Haven’t Filed Yet, Read This!

Did You Know…

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  • The IRS receives about $950 billion per year in taxes from US Citizens and about $325 billion dollars is paid out in refunds. If you are getting a refund, you are paying too much in taxes. You do NOT want a big refund. The government does not need an interest free loan paid out by you.
  • The top 1% of earners actually only make about $370,000. The top ten percent make about $117,000. Ninety percent of people make less. About 275,000 tax returns showed adjusted gross incomes of at least $1 million. Over 40,000 of them are in California and the least are in Vermont.
  • Ninety percent of tax returns are filed electronically. About half are done by a paid professional. Check out H&R Block if you need help, but not if your taxes are complicated.
  • Itemize and claim the standard deduction. The average standard deduction is $7-8,000 dollars.
  • The US Tax Code is an ever-changing 4 million word document.
  • Those who earn $100,000 to $200,000 pay an average federal tax rate of only 12%, while those earning $200,000 to $500,000 pay 19.6%.

Ever wonder where it goes? Check out this chart from money.cnn.com:

uncle sam spend taxes

Here are some helpful hints and reminders when filing…

  • Remember to deduct donations, including your church and Goodwill, the two most popular.
  • Deduct professional expenses, including union dues. Just be prepared to justify these deductions. You don’t want to red flag yourself.
  • Deduct childcare expenses, including daycare (the biggest expense).
  • Increase IRA contributions for 2017. These are tax deductible.
  • Take an opportunity to refinance your home. When begin a paying a mortgage, you pay out much of the interest up front, which is tax deductible. When you refinance, you go back to that stage of front loading interest, creating a bigger deduction.
  • Use current tax laws. Have there been any changes to energy efficient homes and cars? You may need an accountant to be sure you’re totally up to date and reaping every possible advantage.
  • Withhold more in 2017 if you’re getting a large refund. The government shouldn’t be holding on to your money.