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Lowering your AGI now can help you, come tax time

Posted on August 16, 2019

Getting smart about your adjusted gross income (AGI) now is a smart way to lower how much tax you will potentially owe in April. That’s why the tax team at Teipen Selanders Poynter & Ayres recommends taking the time to do a little proactive 2019 tax planning this summer.

Your AGI includes income from all sources — minus any adjustments or deductions — to your income. Generally, the higher your AGI, the higher your tax rate, therefore, the more tax you pay.

Adjusting your AGI now can help your tax bottom line. Here are some ways to save:

  • Contribute to your Health Savings Account
  • Claim and itemize educator expenses if you’re a qualifying educator
  • Pay down student loan interest
  • Contribute money to a 401(k) or 403(b) retirement plan at work
  • Invest in a traditional IRA plan (your maximum yearly contribution depends on your age)
  • Self-employed SEP, SIMPLE, and other qualified plans are also retirement options that can lower AGI.

There are many more possibilities, too. Check out Schedule 1 of Form 1040 on IRS.gov.

Want to know more? The IRS has several digital tools you can use to stay updated on important tax information that may help with 2019 tax planning.

In addition to visiting IRS.gov, you can also download the IRS2Go mobile app, watch IRS YouTube videos, or follow the IRS on Twitter and Instagram for helpful tips and updates on changing regulations.

At Teipen Selanders Poynter & Ayres, we want to make dealing with taxes as manageable for you as possible. Let us know if you have any questions.