A Tax Strategy with Tax Credits Saves You Money

When your tax professional talks to you about tax strategy you will be asked whether you have tax credits that you can apply to your taxable income. Examining your tax credits is a vital to any good tax strategy because tax credits can actually lower the amount of taxes that you will pay, and that is money in the bank.
Have you ever wondered exactly what a tax credit is? A tax credit works in two ways with your tax strategy. First, it lowers the amount of income that can be taxed. For example, if you make $40,000 in taxable income but have $10,000 in tax credits, it means that the government will only be able to tax you for $30,000. The second way a tax credit works in your tax strategy is by allowing you to refund the amount of the tax credit, regardless of whether you owe taxes or not.
Congress has recently started using tax credits more and more as a way to encourage Americans to lean toward things like driving a hybrid cars or using energy star appliances in their homes. That is one reason why it is important to use a professional tax preparer as part of your tax strategy. He or she will know and understand current laws and tax credits so that you can get all of the money that is due to you.
Your tax professional can help you claim tax credits by filing your taxes in itemized deductions. That means that every single expense and proof of that expense is listed on your taxes as proof of the tax credits that you are claiming. By keeping the receipts of applicable tax-credit items, you will make an itemized list of deductions easier for your tax professional.
A thorough tax strategy should always include as many tax credits as you can get. It will save you money by helping you to have less available taxable income.

Karla Dennis

As seen in Forbes Magazine, Karla Dennis is an expert tax and business strategist. As an enrolled agent, Karla is licensed to represent taxpayers in all 50 states. She holds a Masters in Taxation and Business Development and is the author of two books, Tax Storm and Against the Odds.

Karla, CEO of consultancy firm Karla Dennis And Associates, Inc.™, has saved her clients thousands of dollars and has been featured in various media outlets such as Forbes, MSNBC, KTLA, Yahoo! Finance, and SmartMoney, marking her as the ultimate tax expert.

As of 2014, Karla became the new host on the “Mind Your Business” radio show, KTLK AM 1150, sharing her financial and business knowledge with the greater Orange County and Los Angeles areas. As a supporter of women’s rights and issues, Karla is part of the Women Network, an organization built to educate and mentor women. In addition, Karla is the radio host for Women Network Radio, a show that aims to uplift and empower women of all walks of life.