Tip - Tax evasion is illegal. Tax avoidance is smart

Tax evasion is illegal. Tax avoidance is smart. Non-itemizers pay too much. Don’t miss out on valuable tax credits and deductions. For instance, if you are a single filer earning up to $27,750 and you contribute $1,000 to a qualified retirement account, take the Savers Credit worth $1,000. Similarly, joint filers earning up to $55,000 who make a $2,000 contribution get a $2,000 credit. That’s free money. Then there’s the American Opportunity Credit, which lets families claim up to $2,500 for the first four years of college for each student. It often goes untaken. The bottom line: It pays to be thorough when filing your taxes. If you think you’ll miss savings, bring in an expert or use a software program that offers expert advice.

by Jean Chatzky