Knowing the difference between tax credits and deductions can help you maximize your savings. Polaris Tax & Accounting breaks down these tax-saving tools, helping you understand how each can reduce your tax bill.
Tax Credits vs. Deductions
- Tax Deductions
- Deductions reduce your taxable income. Common deductions include mortgage interest, business expenses, and charitable donations.
- Tax Credits
- Credits provide a dollar-for-dollar reduction in your tax bill. Common credits include the Child Tax Credit and Education Credits, which directly reduce the amount you owe.
Maximizing Savings
Polaris’s tax preparation services help you identify all eligible deductions and credits, ensuring you minimize taxes owed and keep more in your pocket.
Conclusion
Understanding tax credits and deductions is key to reducing your tax liability. Schedule your tax preparation consultation with Polaris today, and let us help you maximize your tax savings.