What Can I Do To Lower My Taxes If I’m Single?
Every year I seem to experience the same question. Single people seem to get the short end of the stick when it comes to taxes.
What is interesting is that I asked Chat GPT the question and this is what I got!
- Claim Tax Credits: Funny as! If you are a single parent with children, you can get the Earned income credit anyway. Nothing burger!
- Contribute to Retirement Accounts: This is just like the old charity deduction – contribute $1,000 and only get $200 back. You are still out $800!
- Utilize Tax Deductions: Funny how this came up. It’s like telling a person who wants to swim to go in a pool!
- Health Savings Account (HSA): This has it’s merits if you have high medical expenses. Still not a permanent year after year reduction.
- Education Expenses: Good deduction if you qualify based on your income. Another good credit but not a year after year reduction.
- Tax Efficient Investing: This is an annual tax savings tip given by CNN & MSNBC. Only temporary savings!
- Take Advantage of tax planning services: Not all planning is the same! You just saw tax planning from Chat GPT – Most tax advisors follow the same routine!
- Charitable Deductions: I cannot believe they are still using this one! The IRS basically took away itemized deductions by upping the standard deduction so, for most people, the charity deduction is out the door
Now for the FUN Part!
Yes, on average, single people pay more in taxes. This of course depends on the amount of income and a few other factors.
The BEST way to lower your taxes if you are a single person is to have a home based business (or side hustle).
While some of the aforementioned deductions and credits are somewhat good, they are only temporary. A side hustle can last a long time!
Here are just some of the items you can deduct EVERY year with a home based business:
Charity! (Donate in the name of your business
and many, many, more!
Home based business are very easy to start these days and can be started with little or NO money!
I have been doing home based business taxes for over 45 years and the average money people save is around $2-$3,000/year!
CLICK HERE to download a FREE Report on the Top 7 Businesses to Start with NO Money!