How to Save Money on Taxes: Free Filing, Credits, Deductions and Scams to Avoid

1. File for free if you can

Paying to file is optional for a lot of people. Check these free options first:

• IRS Free File: the IRS partners with tax software companies so eligible taxpayers can prepare and e-file a federal return for free. Guided software has an income limit, and each partner sets its own rules, so start on the IRS Free File page (opens in a new tab) rather than a company's own site. Free File Fillable Forms, electronic versions of IRS paper forms, are also listed there.
• VITA and TCE: IRS-certified volunteers prepare returns for free through the Volunteer Income Tax Assistance and Tax Counseling for the Elderly programs. VITA serves people under an income limit, people with disabilities and limited English speakers. TCE focuses on people 60 and older, with help on pensions and retirement questions. Find a site through the IRS free tax help page (opens in a new tab).
• MilTax for the military community: MilTax, from the Department of Defense through Military OneSource, offers free tax software and free help from tax consultants for active-duty service members, eligible family members, survivors, and veterans up to 365 days after separation or retirement. See MilTax on Military OneSource (opens in a new tab). Many military bases also run VITA sites.

2. Claim the credits you qualify for

A credit lowers your tax dollar for dollar, and some credits are refundable, which means they can increase your refund. These are worth checking every year, because eligibility depends on your income, family and situation:

• Earned Income Tax Credit (EITC): for working people with low to moderate income. The IRS says many eligible people miss it, so check even if you didn't qualify before. See the IRS EITC page (opens in a new tab).
• Child Tax Credit: for taxpayers with qualifying children. See the IRS Child Tax Credit page (opens in a new tab).
• Saver's Credit: a credit for contributing to a retirement account such as an IRA or a workplace plan, for eligible taxpayers. See the IRS Saver's Credit page (opens in a new tab).
• Education credits: the American Opportunity Tax Credit and the Lifetime Learning Credit can help with qualified college and training costs. See IRS education credits (opens in a new tab).

3. Standard deduction or itemize?

Most people take the standard deduction. You may save more by itemizing if your deductible expenses add up to more than your standard deduction. Common itemized deductions include mortgage interest, state and local taxes (up to a limit), charitable gifts and medical expenses above a share of your income. Tax software and preparers can compare both ways for you.

If you're self-employed or run a side business, business expenses are a separate set of deductions. See our small business deductions checklist.

4. Lower your tax with IRA and HSA contributions

• Traditional IRA: contributions may be tax-deductible, depending on your income and whether you or your spouse have a retirement plan at work. Roth IRA contributions aren't deductible, but qualified withdrawals later are tax-free. See IRS IRA basics (opens in a new tab).
• Health Savings Account (HSA): if you're covered by a qualifying high-deductible health plan, HSA contributions can lower your taxable income, and money used for qualified medical expenses comes out tax-free. See IRS Publication 969 (opens in a new tab).
• Timing: in general, you can make IRA and HSA contributions for a tax year up until that year's filing deadline, not counting extensions. Check the IRS pages for current limits.
• Workplace plans: contributing to a 401(k) or similar plan through payroll can lower your taxable wages, and a contribution may also count toward the Saver's Credit.

5. Keep records that make tax time easier

Good records help you claim every deduction and credit you're entitled to, and back them up if the IRS asks. The IRS generally says to keep records that support your return for at least 3 years, and longer in some cases. See IRS recordkeeping guidance (opens in a new tab).

• Keep W-2s, 1099s, receipts for deductible expenses, donation receipts, and statements for retirement and health savings accounts.
• Use one folder, paper or digital, for each tax year.
• If you have lots of receipts, especially from a side business, a receipt scanning app can help keep them organized. We list one in the recommended links on this page.

6. Avoid tax-prep scams and costly refund products

• Choose a preparer carefully. Paid preparers must have an IRS Preparer Tax Identification Number (PTIN) and must sign the return. Avoid anyone who won't sign, bases their fee on the size of your refund, or asks you to sign a blank return. The IRS explains how to choose a tax professional (opens in a new tab).
• Know the season's scams. The IRS publishes its Dirty Dozen list of tax scams (opens in a new tab) each year, including fake IRS calls and texts and bad tax advice on social media.
• The IRS won't call to demand immediate payment by gift card, wire transfer or cryptocurrency. See our money scams to avoid guide.
• Be careful with refund advances and refund transfers. These are offered by some preparers and can come with fees or interest, or with higher prep fees. Ask for every cost in writing. Filing electronically with direct deposit is usually the fastest way to get a refund at no extra cost.

7. Florida and state taxes

Florida has no state personal income tax, so most Florida residents file only a federal return. The Florida Department of Revenue's new resident guide (PDF) (opens in a new tab) covers the taxes Florida does have.

Florida also holds sales tax holidays, and some items are exempt from sales tax all year. See our Florida tax-free hurricane supplies guide. If you split time between states, residency rules matter. See our snowbird residency and taxes guide.

8. Adjust your withholding

A big refund means you lent the government money all year for free. A big bill can mean penalties. Use the IRS Tax Withholding Estimator (opens in a new tab) after a life change such as a new job, a marriage, a new child or a side business, then give your employer a new Form W-4 if needed. If you're self-employed or have income without withholding, you may need to make estimated tax payments.

9. When to talk with a tax professional

Consider a qualified tax professional, such as a CPA, an enrolled agent or an attorney, if you started a business, sold a home or investments, moved between states, received an IRS notice, or simply want a second look. A good one can often save more than they cost. Ask about fees up front.