2. You Contributed More to Retirement Accounts
If you made more significant contributions to retirement accounts like a 401(k) or IRA, your taxable income for the year will decrease. The government incentivizes retirement savings by offering tax breaks on your contributions to these accounts. For example, putting money into a tax-deferred account means you pay less in taxes for that year and potentially receive a bigger 2025 Tax refund.
What to Do: If you have the financial flexibility, try to max out your contributions to retirement accounts in 2025. The more you contribute, the more you can reduce your taxable income.
Action Needed: Check the contribution limits for your retirement accounts. And see if you can maximize your contributions before the end of the year to maximize your tax savings.
Also, Check this Update – Significant Changes to Your 401K Plans in 2025: What You Need to Know
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