With a month left before the tax deadline, there are still 3 simple ways to cut your bill by around $4k

For the majority of Americans, the tax deadline is now less than a month away.

According to the latest data from the Internal Revenue Service (IRS), approximately 63 million returns have been filed so far this season, with the average refund up 5.8 percent from last year.

This is less than half of the 146 million returns the agency expects to receive this year, meaning the majority of taxpayers still have to file returns in the coming weeks.

Although experts warn that the “toolbox” of options is now much smaller to reduce your tax bill with deductions and credits, there are still steps you can take to make filing easier – and cheaper.

Here are three things to consider before the filing deadline.

1. Free Filing Options – Save $160

This season, Americans can choose from several free filing options.

Last week, the U.S. Treasury Department announced that Direct File – the IRS’s free tax filing program – is now fully open in twelve states.

The service is open to taxpayers in Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington and Wyoming.

Americans who live in these states, have simple filing needs and who report certain tax credits and deductions on their tax returns can create an account and file their taxes at any time, the IRS said.

According to a report of the Economic Security Project, the program could save the average filer $160 per year – and hours of their time – within five years.

The project predicts it can collectively save $11 billion annually in filing and time costs.

“By removing barriers to filing, Direct File would also provide up to $12 billion in additional tax credits each year to low-income families that are currently missing out,” it said.

Taxpayers in any state with an adjusted gross income of $79,000 or less can also file for free through Free file.

This service allows eligible taxpayers to use guided software to prepare a return with one of eight tax preparation partners.

2. Claim a lesser-known credit – $2,541 on average

The earned income tax credit (EITC) is a refundable tax credit for low- to moderate-income workers.

To claim the EITC, you must meet income requirements and not be able to transfer a certain amount of investment income.

You don’t have to have a child to claim the credit, but generally the more children you have, the higher the credit amount will be.

For this tax season, the credit amounts are $600, $3,995, $6,604 and $7,430, depending on your filing status and the number of children you have.

Nearly one in five eligible filers misses out on the credit, which averaged $2,541 last season, according to IRS Commissioner Danny Werfel.

“This is a lot of money” and millions of Americans are “simply overlooking it,” he said earlier this year.

According to the agency, some taxpayers may also be eligible for tax credits in 2023 for purchasing an electric vehicle or making energy improvements to their home.

3. Reduce your tax bill – in some cases $1,560

After the calendar year ends, “the toolbox of options is much smaller” to lower your tax bill, John Loyd, owner of The Wealth Planner, told me. CNBC.

For example, to be considered tax deductible, it must be made before December 31st in order to be claimed on a return filed in April next year.

But there are still some steps for which it is not too late, experts say.

There’s still time to make contributions to a pre-tax individual retirement account (IRA), which may offer a deduction depending on your income and workplace plan participation.

For the 2023 tax year, the contribution limit is €6,500 – or €7,500 if you are 50 years or older.

This is possible until the April tax deadline.

For example, an employee who pays a 24 percent tax rate and contributes $6,500 to an IRA would pay $1,560 less in federal income taxes. Of course, they have to keep the $6,500, but it’s money they’re paying themselves to use in the future, so it’s going to a good cause.

And many people don’t know that they can contribute earned income to the IRA account of a low-earning or non-working spouse if they file a joint tax return as a married couple, says certified public accountant Tom Wheelwright.

You can also still contribute to a health savings account (HSA), if you have a qualifying insurance plan.

HSAs offer tax-free contributions, growth and withdrawals for eligible expenses such as doctor visits, dental care, vision care and medications.