Although 2024 is behind us, you still have time to take action and reduce your tax liability. Here are five key strategies that could help lower your 2024 federal income tax bill before the April 15 deadline.
1. Make a Deductible HSA Contribution
If you had qualifying high-deductible health insurance in 2024, you can still open and contribute to a Health Savings Account (HSA) for the 2024 tax year. Contributions must be made by April 15, 2025.
Self-only coverage: Up to $4,150
Family coverage: Up to $8,300
HSA contributions are above-the-line deductions, meaning you can claim them even if you don’t itemize. Plus, there are no income limits—even high earners can benefit.
2. Choose to Deduct State & Local Sales Taxes Instead of Income Taxes
If you live in a state with low or no income taxes, you may benefit from deducting state and local sales taxes instead. This deduction is only available if you itemize, and remember that the total State and Local Tax (SALT) deduction is capped at $10,000 ($5,000 if married filing separately).
For larger purchases like cars, boats, or home improvements, adding up receipts could result in a higher deduction than the IRS-provided table amount.
3. Make a Deductible Traditional IRA Contribution
If eligible, you can still make a deductible traditional IRA contribution for 2024 before April 15, 2025:
Up to $7,000 ($8,000 if 50+)
Must have earned income
Deduction may be reduced if you or your spouse had a tax-favored retirement plan
4. Deduct Medical & Health Insurance Costs
You can deduct medical expenses exceeding 7.5% of your adjusted gross income (AGI), including:
Health insurance premiums
Long-term care costs
Out-of-pocket medical expenses
For self-employed individuals, health insurance premiums (including Medicare) may be deducted above-the-line, even without itemizing.
5. Claim a 2025 Personal Casualty Loss on Your 2024 Return
If you've been affected by a federally declared disaster in 2025, you can choose to claim the loss on your 2024 return to potentially lower your tax bill sooner.
Recent tax relief laws allow eligible taxpayers to claim certain disaster-related losses without itemizing deductions, making it easier to recoup losses.
Need More Time? File an Extension!
If you’re not ready to file by April 15, you can request an automatic six-month extension (until October 15). However, this only extends the filing deadline, not the payment deadline—you must estimate and pay any owed tax by April 15 to avoid penalties.
Get Tax-Smart Before the Deadline
Need help maximizing deductions or filing an extension? Contact Verity CPAs today at info@verity.cpa or 808.546.5026.
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