Trying to understand taxes is the absolute worst. However, it’s something that is very important to understand. If you mess up your taxes you will end up in a bad way with the government who will want their money back plus penalties and interest.
Even if you don’t screw up your withholding and/or tax payments you may be leaving pre-tax benefits and deductions on the table.
You can save on taxes by contributing to pre-tax retirement funds, dependent care accounts, health savings accounts, and more. The best way to know what tax benefits may be available to you is to understand what is offered through your employer.
The absolute best way to maximize your tax deductions is to find a really good CPA. If you don’t have one already then you should shop around for one. Ideally, you want a CPA who specializes or has experience working with clients in your industry. They will understand what special rules and benefits apply to you. They will help you make sure your withholding is set up correctly and/or help you make those quarterly payments. They’ll also see if you’re missing out on any deductions. Yes, you have to pay a CPA but I’ve always found they find me more money than they cost.
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