Hey there, loyal, tax-paying and patriotic citizens of America!
Summer is in full swing, and it’s time to embrace the season of fun and sun. We’re sure you’re making the most out of this summer season and while doing so, you haven’t turned a blind eye toward your national duty of filing income tax returns.
While you enjoy your summertime, did you know that activities you undergo to make your summers memorable could impact your tax returns?
While you’re enjoying having your tan, we want to make sure that you do not forget to double down on these memorable times and leverage them in your next tax return.
For that, we’ve got some awesome tips to help you maximize your tax benefits while enjoying the best of summer. Check them out
Summertime activities that might affect your tax return next year
#1. Tying the Knot:
Love is in the air, and wedding bells are ringing! If you’re a newlywed and fortunate enough to tie knots this summer, make your tax filing a breeze by taking these few simple steps.
- Notify the Social Security Administration of any name changes,
- Update your address with the USPS, employers, and the IRS.
- Fill out Form 8822, Change of Address, and send it to the IRS.
These small but crucial timely updates will make filing your tax return a walk in the park.
#2. Summer Camp Adventures
Planning to send your kids off to summer camp? Well, here’s a cool tidbit for you. The cost of summer camp may qualify for the Child and Dependent Care Credit.
That’s right, you can have fun in the sun and enjoy peaceful times while the kids are away (didn’t want to put it that way but who are we kidding? We all are guilty of yearning for some noise-free, non-chaotic time, aren’t we?) while also earning some tax benefits.
It’s a win-win!
#3. Business Travel Bonanza
While the kids enjoy their break, parents are still in work mode. If you’re traveling for business, listen up!
You may be eligible for tax deductions on your travel expenses.
Whether you’re jet-setting for a few nights or taking an extended summer business trip, know the rules and make the most of your business travel.
The eligible business expenses are allowable deductions for tax purposes and you can claim them either in your Schedule C or Schedule E (depending on your business nature).
So make sure you take full advantage of this leniency to lower your annual tax liability. Ensure you have the proper receipts and paperwork to back up your claim.
Very quickly, deductible travel expenses are the necessary expenses of traveling away from home for your business, profession, or job. here are some of the allowable travel expenses that you can claim in your return:
- Travel Expenses: Any means of transport that you use (airplane, train, bus or car, etc) between your home and business destination.
- Using your personal vehicle at a business destination
- Laundry & dry cleaning
- Telephone calls (for business purposes)
- Tips & fees
- Shipping of baggage
#4. Part-Time Power
Summertime often brings part-time work opportunities. Even if you don’t earn enough to owe federal income tax, filing a tax return can still be rewarding. You might be eligible for a refund, so why miss out?
Head over to IRS.gov to learn more about who should file a tax return. And if you’re earning as a gig economy worker, visit the Gig Economy Tax Center for tips on how your gig work affects your taxes.
Plus, keep an eye out for an IRS Form 1099-K if you receive over $600 through payment apps. Stay informed and get those tax benefits!
#5. Home Improvement Tax Credits
Summer is the perfect time to tackle those home improvement projects. And guess what? The IRS has some fantastic tax benefits for you!
If you make energy-efficient improvements to your home from January 1, 2023, onwards, you could qualify for a tax credit of up to $3,200.
Yes, you heard that right—cash in on those home improvement upgrades while saving on taxes.
Head to the Energy Efficient Home Improvement Credit page on IRS.gov to learn more and get inspired.
Remember, energy-efficient improvements aren’t the only ones that could earn you tax credits. Thanks to the Inflation Reduction Act of 2022, there are expanded opportunities!
Think water heaters, windows, doors, heating, and air conditioning installations—all part of the Energy Efficient Home Improvement Credit. And if you’re going green with solar, wind, geothermal power generation, solar water heaters, fuel cells, or battery storage, don’t miss out on the Residential Clean Energy Credits.
It’s time to make your home a tax savings paradise!
So, there you have it, folks! Summer is all about making memories, and now you can make your tax returns even more memorable. Dive into these exciting summertime activities while keeping an eye on those tax benefits.
Happy summer and happy savings!