Score A Big Refund – How I Shaved $41,000 Off My Taxable Income

Hello Sophisticated Spenders!

This post was originally written in January of 2012 but the ideas still apply!

Today I would like to share with you a few of the ways that I reduced my Adjusted Gross Income (AGI).

I shaved $41,000 off my taxed income!

First I reduced my gross income by:

1. Contributing to my retirement account.

2. Making Charatable Contributions thru CFC (my employer).

3. Taking advantage of my company’s medical saving account.

In 2010, I grossed approx $79,000.  I reduced my Adjusted Gross Income to $68,000.

I reduced my Adjusted Gross Income by the first $10,000 by:

1. Having Rental Real Estate

2. Student Loan Interest

3. Taking a dance class at the local community college

Next, I reduced my Taxable Income to $38,000 because I itemize.  Here are my items:

1: State and Local Income Taxes

2: Paying Real Estate Taxes

3: Personal Property Tax (Virginia Drivers have to pay this)

4: Home Mortgage Interest and Points

5: Mortgage Insurance Premiums

6: Gifts to Charity (Donations)

7: Tax prep fees (includes books and software)

[tweetthis]Tax advantages of home ownership, college, saving for retirement, owning rental real estate & donating to charity. [/tweetthis]

[tweetthis]Spending all of your money on McDonald’s, Starbucks and other “stuff” does not pay off. [/tweetthis]

[tweetthis]Try to spend a decent amount of your money on things that can pay you back![/tweetthis]

TurboTax has an app called Tax Caster.  It will give you an expected refund amount.  I entered last year’s tax info and it was pretty accurate!

Good luck and I wish you a big refund!

Any other items that are missing from the list???