10 Easiest Ways To Reduce Your Tax Bill

10 Easiest Ways To Reduce Your Tax Bill

When it comes to the savings on your tax bill; the first thing that you need to do is to learn about the tax laws to take every tax deduction to which you’re entitled. Believe me, this advice will help you save thousands of dollars.

If you want to get the detailed information, you can visit the IRS website that will help you further understand the following tax credits and deductions. If you spend some time each year on keeping you aware of the tax law, you’ll definitely save a lot. Here, in this article, I’ve compiled a list of 10 easy ways to cut your tax bill, so you can serve your finances well.

1. Retirement Account Contributions

It’s the first tax reduction tool that mainly serves two purposes. Apart from the Roth personal retirement account, almost all contributions will enable you to deduct the amount paid from your taxable income. It will eventually decrease your total tax income and these funds grow tax-free until retirement. This plan will alone secure your retirement if you start early.


2. Health Saving Account Contributions

If you have a high deductible medical plan, then the best way is to contribute to a health saving account. In this way, your unused medical contributions will overturn for an indefinite period and grow tax-free like other assets in your retirement account.

3. Combining A Vacation With A Business Trip

Another way to cut your tax bills is by merging a holiday trip with a business trip. This way, you can decrease the cost spent on vacation by subtracting the amount of reimbursed business expenses (including the airfare and the hotel payment) from the total bill.

4. Taking Home Office Deductions

If you have a side business, then you are eligible to get the home office deductions. In this way, you can cut the % of your home used for business under the law (Schedule C, 1040). For instance, you’re using the guest room exclusively as a home office, which makes up 1/3 of the entire living space, then you can deduct 1/3 of the utility fees and rent for your home office.


5. Self Employed

If you’re self-employed (full-time/part-time), then you’re automatically eligible for tax reduction scores. Some of these expenses include: advertising, website fees, business vehicle mileage, shipping, % of home internet bills used for business, office supplies, memberships, publications, business trips and any other cost incurred to run your business.

6. Social Security Tax

If you’re self-employed and pay 100% of the social security taxes owed, 15.3% can wave off 50% of the taxes paid. And to claim the tax deduction, you don’t even need to itemize.

7. Reimbursed Vehicle Expenses

This tax break is often overlooked. If you’re traveling to the satellite office and using your own vehicle, then you can wave off mileage costs. But you aren’t entitled to commuting costs deductions.


8. The Lifetime Learning Credit

It’s another great tool for adults to boost up their education and training. This credit will give you a max of $2000/year, which is 20% if you have spent $10000 on your high school education program. You can use this money for your educational expenses.

9. Earned Incomes Tax Credit

When it comes to the earned income tax credit, it will lower down the overall tax bill, especially for lower and moderate income families.

10. State Sales Tax

It’s another type of tax break in which itemizers will get the opportunity to either wave off the state sales or state income taxes paid. It’s a great advantage for those who are living in a state without income taxes and looking for a tax-free gold.


Above are some simple tips on how you can cut more on your taxes by understanding the laws and simple loopholes which can save you lots of dollars on your tax bill.

Featured photo credit: CCI mag via

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Adnan Manzoor

Data Analyst & Life Coach

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Last Updated on March 4, 2019

How to Use Credit Cards While Staying Out of Debt

How to Use Credit Cards While Staying Out of Debt

Many people will suggest that the best thing to do with your credit cards during these tough economic times is to cut them up with a pair of scissors. Indeed, if you are already in huge debt, you probably should stop using them and begin a payback strategy immediately. However, if you are not currently in trouble with your credit cards, there are wise ways to use them.

I happen to really love my credit cards so I will share with you my approach to how I use mine without getting into deep financial trouble.

Ever since about 1983 when I got my first Visa card, I continue to charge as many of my purchases as possible on credit. Everything from gas, groceries and monthly payments for services like my cable and home security monitoring are charged on credit. Despite my heavy usage, I have maintained the joy of never paying any interest fees at all on any of my credit cards.


Here are some tips on how best to use your credit cards without falling into the trap of paying those nasty double-digit interest fees.

Do Not Treat Credit Cards as Your Funding Sources

Too many people treat their credit cards as funding sources for major purchases. Do not do this if you want to stay out of trouble. I use my credit cards as convenient financial instruments so I do not have to carry around much cash. In fact, I hate carrying cash, especially coins. When you buy things on credit, the purchases are clean and you will not get annoying coins back as change.

I do not rely on my Visa, MasterCard or American Express to fund any of my purchases, large or small. This brings me to my golden rule when it comes to whether I will pull out any of my credit cards either at a retail or online store.


I never purchase anything with my credit cards if I do not have the actual cash on hand in my bank account.

If I really cannot pay for the item or service with cash that I already have at the bank, then I simply will not make the purchase. Remember, my credit cards are not used as funding sources. They are just convenient alternatives to actual cash in my pocket.

Make Sure to Always Pay Off Balances in Full Each Month

The next very important part of my overall strategy is to make absolutely sure that I pay the balances in full each and every month no matter how large they are. This should never be a problem if the cash has been budgeted for my purchases and secured in the bank. I have always paid my full balances each month ever since my very first credit card and this is why I never pay interest charges.


Using Credit Cards with Rewards

Most of my credit cards are of the “no annual fees” type, including one MasterCard on a separate account I keep at home as a spare in case I lose my wallet or incur any fraudulent charges. However, I do use a main Visa card which does have an annual fee because all purchases on that card reward me with airline frequent flyer points. For me, the annual fee is worth it since I do travel and I get enough points to redeem many free flights.

You have to decide for yourself if you will charge enough purchases on credit each year without paying interest charges to warrant a credit card that rewards you with airline points (or other rewards). In my case, the answer is “yes” but that might not be the case for you.

I occasionally use a MasterCard or American Express card on small purchases just to keep those accounts active. Also, I have been to the odd retailer that accepted only a certain type of credit card, so I find that having one from each major company is quite handy. Aside from my main Visa card which earns the airline points, the rest of my cards are of the “no annual fees” variety.


So this is how I use my credit cards without getting into any financial trouble with them. This strategy is recommended only if you are not in debt, of course. In fact, it is worth keeping in mind once you’re out of debt so that you can keep your credit cards active and treat them responsibly.

What are your credit card usage strategies? Let me know in the comments — I’d love to hear what methods you use.

Featured photo credit: Artem Bali via

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