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HomeTop Global NewsLesser-Known Ways to Lower Your 2022 Tax Bill or Boost Your Refund

Lesser-Known Ways to Lower Your 2022 Tax Bill or Boost Your Refund

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1. If you earn more in 2022, defer your bonus to 2023

Experts say that if you’ve had a good year and expect to earn less in 2023, you may want to try postponing the holiday bonus until the new year.

“It’s always exciting to see hard work rewarded by receiving a year-end bonus,” said Lisa Green-Lewis, a CPA and tax expert with TurboTax. “But sometimes he can bump you into another tax bracket.”

However, by receiving the money in January, you can reduce your 2022 income without waiting too long for the money, assuming your company allows it, he said.

2. Prepay future medical expenses for deduction

For example, with many children in orthodontic braces, you could ask to pay off the balance before the end of the year if you can afford it, she suggested. “The provider may also offer a discount for paying everything off sooner,” said Cheng, a member of CNBC’s Council of Financial Advisors.

Of course, you’ll need to project your adjusted gross income, total itemized deductions, and tally up your past 2022 medical expenses first.

3. ‘Maximize Your Bracket’ With a Partial Roth Conversion

Thomas Scanlon, a CFP and CPA at Raymond James in Manchester, Connecticut, said, “The bottom line is that if you are in retirement or near retirement and your income is low, you may want to consider filling out enough to max out your bracket. want to do.”

For example, if you’re already in the 24% bracket, it’s likely there’s still room for more income before triggering the 32% on an additional amount, he said.

Scanlon said partial Roth conversions work well for retirees who are “income light and asset heavy,” such as someone who leaves the workforce several years before starting required minimum distributions.

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