This is mainly because there are many taxpayers who are not aware of the tax credits you may qualify for. So, the first tip is to check all the tax credits available and see your eligibility.
Then, you should claim all the ones that you are eligible for. Not doing this may result in the loss of additional money. Tax money that could boost your financial situation.
WHAT CAN I DO IF I DO NOT UNDERSTAND TAX CREDITS?
Undoubtedly, if you are in this situation, you had better ask for help. There are many financial advisors and tax preparers that could give you a hand. It is true that it will not be free, but you may end up getting a lot more.
Otherwise, you may not know you are eligible and the IRS sends that unclaimed money to the US Treasury after the deadline to claim it is over. Exceptionally, the IRS extended the date to file for tax refunds due to the pandemic.
But in general, you just have three years to do so. Workers should also maximize their retirement savings account contributions. Apart from contributing and saving money for the future, you may have tax advantages.
Single filers may not have an option to choose their filing status. Nevertheless, married couples can choose whatever is best for them. Check the tax brackets that are more convenient and opt for the best filing status.
The last tip you should take into consideration is whether to itemize or not. Check if you can benefit from a simple standard deduction or if it is best to itemize. For example, if you have healthcare expenses or you have made contributions to an eligible charity.
Be wary of ads on the radio or TV promising a large refund. It is best to look for a preparer that the IRS recommends. By doing so, you can get out of trouble and make more money.