RE: Back taxes and 2023 taxes

M-otwin05g

Greetings, I owe back taxes of $3700. I am sure that I will owe from 2023 as I began working part-time and will receive 1099s. I just started a new job which pays well and I want to get the $3700 paid by 4/15/24. Is there anyone that I can work with to explore tax breaks and planning going forward as a Licensed Mental Health Therapist? Thanks so much!!

kiarab

Hello,

Tax planning is not a service we provide, but I'd be happy to share a few things with you to help you out.

1. This is a link for all available tax credits and deductions on an individual income tax return: https://www.irs.gov/credits-deductions-for-individuals
2. I'd recommend reviewing the Itemized Deduction section. If you are earning more now, you may have increased expenses (like mortgage interest, more state and local taxes paid, etc) which you can deduct and it may add up to be better than the Standard Deduction for you.
3. There are things you can claim a credit for by purchasing, such as an electric car or solar panels. This can be a great way to reduce your tax liability, especially if you were already considering purchasing it. A thing to keep in mind is your AGI. For some of these, there may be an AGI limit for the credit.
4. Contributing to an IRA: The nice thing about this option is you can contribute to an IRA after the year is over and still have it count. You may be able to get a deduction for what you've contributed to an IRA.
5. If you are planning on having children in the future, you will want to look into the Child Tax Credit and Earned Income Credit (although the EIC is more for lower income families)
6. If you are self-employed as a licensed Mental Health Specialist, you will want to keep very careful records of your business expenses. Generally, if something is necessary and ordinary for your line of work, you can deduct it and lower your overall taxable income.