One of the trickiest things about investing in retirement accounts is that by the time you know how much you could’ve contributed for a tax break, it’s too late (e.g., you can only make 401(k) contributions through Dec. 31).

But there are a few types of investment accounts that’ll help you save taxes, and that allow contributions right up until the tax deadline, making them incredible options for last-minute savings.

After all, I prefer deductions that come from investing over deductions for spending: Why would I *spend* $100 to save $32 when I could invest (read: keep) $100 to save $32?

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Paying taxes is undoubtedly an inevitable part of working and living in any country. As the tax season approaches, the overwhelming thought of having to pay large amounts of taxes can be quite stressful for many individuals. However, with some proper planning and prudent actions, one can lower their tax bill and reduce the financial burden. Here are three easy ways to minimize your tax bill and save some money this year.

1. Make Use of Tax Deductions and Credits

There are several tax deductions and credits available that can help individuals reduce their taxable income. For instance, by contributing to a retirement account such as a 401(k), IRA, or Roth IRA, you can lower your taxable income and defer taxes on earnings until retirement. Similarly, you can claim deductions for charitable donations, interest paid on a mortgage, and medical expenses that exceed the IRS threshold. Additionally, tax credits such as the Earned Income Tax Credit, Child and Dependent Care Credit, and Education Credits can help reduce your tax liability dollar-for-dollar.

2. Maximize Your Allowances

One can make use of various allowances issued by the government by understanding their usage and eligibility. For example, the tax-free allowance or the personal allowance allows taxpayers to earn up to a certain amount before they start paying taxes. Additionally, the marriage allowance allows married couples and registered civil partners to transfer a portion of their tax-free allowance to their partner, resulting in lower taxes for both individuals. Keeping an eye on these allowances and taking advantage of them can make a significant difference to your tax bill.

3. Plan Your Capital Gains and Losses

Capital gains and losses refer to the profits or losses made through the sale of investments such as stocks, mutual funds, or real estate property. By planning your capital gains and losses, you can minimize your tax bill. For instance, if you sell an investment that has decreased in value since purchase, you can claim a capital loss, which can be used to offset any capital gains made in the same tax year. Similarly, if you have held an investment for more than a year and sell it at a profit, you may qualify for a long-term capital gains tax rate, which is typically lower than the ordinary income tax rate.

In conclusion, by making use of these three simple strategies, you can significantly lower your tax bill and save money. However, it is essential to seek advice from a qualified tax professional or financial advisor for customized recommendations based on your specific tax situation. By keeping a keen eye on all available benefits, allowances, and deductions, you can successfully navigate the tax season and reduce your financial burden.