Year Round Tax Savings

Year-Round Tax-Saving Strategies to Lower Your 1040 Taxes

Saving money on taxes isn’t just for tax season—it requires year-round planning. Here are proactive strategies to help you lower your 1040 tax bill and maximize deductions throughout the year.


1. Adjust Your Tax Withholding Early in the Year

✅ If you received a large tax refund, you’re overpaying taxes throughout the year.
✅ If you owed taxes, you may need to increase withholdings or make estimated payments.
✅ Use IRS Form W-4 to adjust your withholdings at work.

🔗 Related: Understanding Your 1040 Tax Return


2. Max Out Retirement Contributions

401(k) contributions reduce taxable income—limit for 2024 is $23,000 ($30,500 if 50+).
Traditional IRA contributions are tax-deductible—limit is $7,000 ($8,000 if 50+).
✅ Self-employed? Consider a Solo 401(k) or SEP IRA.

🔗 Related: How 2025 Contributions to IRA & 401(k) Can Reduce 2024 Taxes


3. Take Advantage of Tax Credits

Earned Income Tax Credit (EITC) – Available to low-to-moderate income taxpayers.
Child Tax Credit (CTC) – Up to $2,000 per child.
Saver’s Credit – For contributing to retirement accounts.

🔗 Related: Your Guide to Tax Credits & Deductions


4. Track and Deduct Work-Related Expenses

Self-employed? Deduct business expenses like home office, internet, and vehicle costs.
Employees working remotely? Check if you qualify for home office deductions.
Freelancers and side hustlers should keep receipts and mileage logs.

🔗 Related: How Small Business Owners Can Reduce Their Tax Burden


5. Contribute to a Health Savings Account (HSA) or Flexible Spending Account (FSA)

HSA contributions are tax-deductible, grow tax-free, and withdrawals for medical expenses are tax-free.
FSA funds are pre-tax but must be used within the year.

🔗 Related: The Health Savings Account (HSA): A Triple Tax Advantage


6. Harvest Capital Losses to Offset Gains

✅ Sell underperforming stocks to offset capital gains taxes.
✅ Can offset up to $3,000 in ordinary income per year.

🔗 Related: IRS Tax Law Changes for 2025


Final Thoughts

Lowering your tax bill requires planning all year long. Take advantage of deductions, credits, and tax-saving investments to keep more of your money.

🚀 Next Steps:

  • Adjust your tax withholding today.
  • Contribute to retirement and HSA accounts.
  • Keep organized records of expenses and deductions.

🔗 Need more tax guidance? Visit our Tax-Saving Blog & Expert Insights.