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Review Tax Credits
These are a dollar for dollar reduction in tax. Some of the most popular ones are the: Earned Income Credit, which helps workers with low or moderate incomes (https://www.efile.com/ tax-credit/earned-income-credit/) Savers Tax Credit, which helps with retirement saving (https://turbotax.intuit.com/tax-tips/tax-deductions-and-credits/what-is-the-savers-credit/L3LyopRkK) Child and Dependent Care Credit, which helps with daycare and after school care costs (https://turbotax.intuit.com/tax-tips/family/deducting-summercamps-and-daycare-with-the-child-and-dependentcare-credit/L8aAzvmjB) The American Opportunity Tax Credit, which helps with college costs (https://turbotax.intuit.com/ tax-tips/college-and-education/what-is-the-american-opportunity-tax-credit/L1Mzj4ybX)
Take Advantage of Retirement Deductions
If your employer offers a 401K plan be sure to contribute to it, at least up to the percent that your employer will match. The employer match is a 100% return on whatever you contribute. You are leaving money on the table if you don't take advantage of it. You can also take deductions for IRA contributions (traditional or Roth).
Use Losses to Your Benefit
If you have an investment that has been losing money consider selling it to offset those losses against gains from other investments that are doing well. This is called "loss harvesting", and you can offset those gains on investment income dollar for dollar. If your losses exceed your gains by $3,000 then you can use that amount to offset other income. Losses in excess
of $3,000 can be carried forward to future tax years.
Invest In A Tax Professional
Enough said. Let the pro's do what they do. Accountant Malaki Sims ’00 lives with his wife and two sons in his hometown of Houston, TX. Malaki earned a degree with a concentration in Accounting in 2000, and after Morehouse, he attended The University of Texas Red McCombs School of Business where he earned an MPA in Accounting. After starting his career as an auditor at Arthur Andersen, Malaki was a Senior Auditor at Ernst & Young as well as McConnell, Jones, Lanier and Murphy. He was a Corporate Accounting Manager at PM Realty Group and an Associate Vice President at Merrill Lynch. A proud Houstonian, Malaki served as president of the Houston chapter of the Morehouse College National Alumni Association, and was responsible for the establishment of several fundraising and engagement events that the chapter still employs today.
TAX DAY: TUESDAY, APRIL 17, 2018 • When Do You Want to Pay? • File Timely or Get an Extension • Don't Chase Tax Deductions • Review Tax Credits • Take Advantage of Retirement • Deductions • Use Losses to Your Benefit • Invest In A Tax Professional We Are Morehouse Monthly|Page 13