Blog Home

Tax Preparation Tips for Seniors: Navigating 2024 Tax Season

“If you get up early, work late, and pay your taxes, you will get ahead — if you strike oil,” joked J. Paul Getty. Who knew he had such a sense of humor?

A little less surprising, but equally as humorous, is this observation by Jay Leno:

“Worried about an IRS audit? Avoid what’s called a red flag. That’s something the IRS always looks for. For example, say you have some money left in your bank account after paying taxes.That’s a red flag.”
The internet is loaded with funny tax quotes. And yet, it’s a safe bet that most seniors don’t find this particular subject to be that amusing. Oh, the irony.
Signing the check might be the most painful part of paying Uncle Sam, but getting there can be equally as stressful and confusing – not to mention unpleasant.
Maybe these tax tips for seniors and retirees will help streamline this year’s process.

Don’t be a Victim

Fact: The IRS will never call you with threats of any kind. But scammers pretending to be the IRS will inundate you with calls hoping to get a bite – and some of your hard-earned cash. Ignore, ignore, ignore.

Also, it’s imperative to maintain security when communicating with your tax preparer. Sensitive information should never be sent via email or over public Wi-Fi. If you suspect you’ve been a victim of identity theft, report it to the IRS immediately.

Reap All You Deserve

Taxes change as we age. Make sure you are aware of all the senior tax deductions including:

  • Charitable Contributions
    • For tax years 2023 and 2024 60% of your gross income is eligible for deductions. Take a look at your cash and con-cash donations and make sure you apply them to your list of deductions.
  • Social Security Tax Savings
    • Social security income may be exempt from federal taxes. If your earnings are less than $25,000 annually, you may not have to pay federal income tax. If your earnings are over $25,000, you may be responsible for only a percentage. Your tax advisor will know which category you fall into and how much you will be able to save.
  • Educational Savings Accounts
    • If you are funding a 529 or Coverdell Education Savings Account, there is no federal savings but your state may allow deductions. Whether you are saving for the kids, grandkids, or yourself, be sure to include the paperwork documenting your investment.
  • Medical Expenses
    • It’s fair to say seniors may have a medical expense or two. The good news is many of them can be included with 2023 deductions. Prescription drug costs, mental health expenses, health insurance premiums, even parking fees at health centers could potentially be deductible. So not only will proactive medical care keep you healthy, it may benefit your wallet as well. Be sure to keep track of your medical info so you can be prepared when you meet with your tax pro.
  • IRA Contributions
    • Whether you are working past retirement age, or independently funding an IRA, there may be some savings in it for you. If you are not covered by an employee plan, your contributions are fully tax deductible. Conversely, if you are contributing to a company sponsored IRA, look into a partial deduction. Present the information to your tax professional to determine your level of benefit.
  • Just Because
    • Depending on your age, filing status, and income, you may be eligible for additional tax credits. Make sure to ask your tax professional if  you qualify for anything extra..
When choosing a tax advisor, be sure to ask the right questions:
  • Do they have a Preparer Tax ID number? This is required for anyone preparing federal tax returns.
  • Check out background and level of experience.
  • Ask about the paperwork they require.
  • Be skeptical if they promise you a large refund up front – without even analyzing your information.
  • Determine the fee schedule up front so there are no surprises later.
  • Ask about electronic filing and who will sign it.
The more organized and prepared you are, the better chance you have of taking advantage of all the potential refunds. Once you rightsize into the Overture senior apartments of your choice, you’ll have the support of a community who shares your concerns. Maybe your walking buddy, or friend from book club, or fitness classmate will share a tax tip that will make all the difference. Book a tour today.
And celebrate that refund tomorrow

No comments yet

Leave a Comment

  • 0/256