many of them are overlooking some of the easiest things that they can do to reduce their tax burden.
Below are three tips that everyone can implement immediately that will drastically reduce a tax burden.
Start a side business
There is no reason that you cannot combine your passions and your economic stream. As long as
you have a legitimate profit motive, the expenses from any business that you start can provide quite a sizable tax haven for you.
Be sure to look into local law to see exactly what constitutes a "profit motive," as it varies from
industry to industry. However, from this you will be able to deduct all of the supplies and the other expenditures that you have.
As your own boss, you will also be able to deduct things like health insurance, use of your computer, and even use of your living space as a place of business. These things are never deductible for an
Organize, organize, organize
To reduce your tax burden, a simple re-organization can give you a huge advantage. Finding the
loopholes in your own expenditures can give you the leverage that you need to maximize your own tax havens.
Simply knowing exactly what tax bracket your income puts you in gives you the leverage to ask for larger deductions. Keep up with all of your side income producing activities. In order to make that money, you will have had to expend some sort of resource. These resources can be deducted.
Being organized will also help you a great deal of leverage if you should be audited randomly. Agents will be much more likely to believe your deductions if they are written down and organized as if you took the process seriously.
Know the rules
There are always new deductions that you can take advantage of from year to year. Do not wait until the last minute to figure out the new rules. If you keep up with the tax news as it happens throughout the year, you can begin to organize your finances in a way that gives you the ability to take advantage of the year to year changes.
There are also many politically based changes that are taking place in the tax code as this article is being written. In the wake of the Great Recession, many concessions are being given to the average taxpayer that are usually not given. Depending on your personal finances, you may be able to take advantage of many government sponsored tax havens that will only be available for a few years.
As always, make sure that you consult with a licensed professional before implementing any tax
Author Bio : Ari is one of the leading tax experts in Australia. He is the most respected accountant North Sydney has to offer, and as a result, Ari’s services are always in high demand. When he is not busy with his work, Ari likes to spend time with his family and keeping fit by going to the gym and mountain biking.