Wouldn’t it be nice to start now employing a few simple techniques to minimize next year’s tax bill? Or, if you don’t expect to owe, why not maximize your refund? Both strategies are possible, and the only requirement is that you do a bit of planning to make it happen. For instance, most taxpayers don’t take advantage of their full IRA retirement contributions, have no idea whether they’ll owe or be due a refund, are unsure whether they’ll owe self-employment tax on a home-based business, aren’t aware of the various energy credits and deductions, and ignore the benefits of using a paid preparer to file their returns early and accurately. There’s plenty you can do to get up to speed on what you might owe or having coming to you, as well as how to keep the bill as low as possible or the refund as high as it can be.

For Optimal Planning, Know Where You Stand

Job one is knowing where you stand. The single most effective way to know is to use a tax calculator to estimate your refund (or bill). For instance, if you expect a refund, you can easily and quickly estimate the amount with TaxCaster, a no-cost tax calculator that shows you how much you have coming to you, or what you might owe. The best part is that you can have all that information even before filing your return. Knowledge is power, and figuring out your situation is the initial step to paying less or getting more money back when April finally arrives.

Leverage IRA Contributions

The exact amounts vary, but for the most part, if you’re under the age of 50, your maximum IRA contribution, which is a fully deductible amount from taxable income, is $6,000. However, age has its advantages because if you are 50 or older the amount is $7,000. That means a husband and wife who file jointly can deduct as much as $14,000 off their taxable income if they contribute the maximum amount to their IRAs.

Don’t Get Sidelined by Self-Employment Tax

If you operate your own business, expect to pay self-employment tax. The rate is 15.3 percent on your bottom-line income from the business or businesses you own. Many taxpayers are surprised the first year they file as business owners because the 15.3 percent is in addition to their personal bill. Reduce this amount by being sure to deduct every legal business expense possible.

Use the Energy Credit

If you own a home and purchase an energy system like solar panels or an efficient HVAC system, there’s a high probability that you can directly write off as much as $500 of the cost from your bill. Check with your preparer or the IRS website to see which devices and systems qualify for the credit.

File Early and Use a Paid Preparer

There’s no better way to make sure that you file an error-free, accurate return than to use a paid preparer. For about $100, you can rest easy, knowing that the preparer will alert you to most of the deductions and credits for which you qualify.