- There is still time before Tax Day on Monday to nail down everything you need — and take advantage of a few tax breaks before it's too late.
- Here are five tips for getting your taxes done on time and saving some money along the way.
If you're waiting until the absolute last moment to file your taxes, you're not alone.
In fact, 20% to 25% of Americans wait until the last 14 days before the deadline to prepare their returns. But procrastinating is more troublesome this year because it's the first time taxpayers are filing under the Tax Cuts and Jobs Act.
Still, for those 11th-hour filers, it's not too late to make a few last minute moves that could trim your bill — and save you money. Here's how:
Unlike 401(k) contributions that have to be made before year-end, taxpayers have until April 15 to contribute to their individual retirement accounts and still take a deduction on their 2018 return.
If you don't participate in a workplace retirement plan, you can deduct up to $5,500 in IRA contributions and can add in another $1,000 "catch-up" contribution if you're over age 50.
If you are in a 401(k) plan at work, you can still fully deduct IRA contributions if your adjusted gross income is less than $63,000 for singles — or $101,000 for married couples.
Additionally, if your spouse has a company plan, you can still contribute to a spousal IRA and get a full deduction — as long as your combined gross income is less than $189,000.
The amount you save for making a contribution will vary. For example, if you are in the 25% tax bracket and make a deductible IRA contribution of $5,500, you will save $1,375 in taxes the first year. But over time, future contributions can save you thousands, depending on your contribution, income tax bracket and the number of years you keep the money invested.
If your health coverage for 2018 was considered a high-deductible insurance plan, you can still contribute to a health savings account and claim it as a deduction on your 2018 taxes, regardless of your income.
HSA contribution limits for tax year 2018 are up to $3,450 for an individual and $6,900 for a family. Plus, if you're 55 or older, you can add $1,000 in "catch-up" contributions to those limits.
To save money this way, you'll need to set up an HSA and fund it before the midnight Monday the tax filing deadline.
If you drive for Uber on the weekends or rent out your house on Airbnb, you could qualify as a business owner and should be filing a Schedule C tax form.
As a general rule, freelancers can write off expenses for business-related meals, lodging, office expenses and required equipment or materials.
More from Invest in You:
This key thing could be messing with your tax refund: Tax withholdings
Boost your financial IQ by answering these 10 questions
What your FICO score means and why you should pay attention
According to the IRS, those expenses must be ordinary and necessary. That means that if it's something you would have purchased regardless of your freelance gig, it likely would not qualify for a deduction.
Similarly, you can take the home office tax deduction if you legitimately have a room or portion of your home that is where you exclusively conduct business. If that's the case, you may be able to write off some potentially hefty expenses, including rent, utilities, insurance and housekeeping. The percentage of the cost that is deductible is based on the square footage of the office to the total area of the house.
Alternatively, by checking a box on your federal tax returns, you can choose the standard home-office deduction of up to $1,500 for the business use of your home.
Parents can claim as much as 35% of their child-care expenses as a tax credit each year, or up to $3,000 for a single child or $6,000 for two or more children, to cover the cost of day-care programs, preschool and summer camps — including music camps, athletic camps and mini camps — for children 12 and under. If the cost of transportation to and from camp is included in the camp's fees, then that counts, too.
The credit, which varies depending on the taxpayer's earned income, only applies for if you are single and working, or if both parents are working.
For that reason, only the cost of day camp qualifies and overnight camp does not. However, if you have a disabled spouse or elderly parent who is your dependent, care-giving expenses incurred for them may also apply.
Since this is a tax credit, rather than a tax deduction, it directly reduces your taxes "dollar for dollar" — in other words, a $1,000 tax credit would cut your tax bill by $1,000.
If you can't get all of this done by midnight Monday, file an extension and pay the estimated taxes you owe before the due date to avoid penalties and interest. That would give you until Oct. 15 to submit your 2018 return.
You can use Free File from the IRS to request an extension electronically or submit a paper Form 4868. But keep in mind that while an extension grants additional time to file, tax payments are still due.
Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.