You can pay fewer taxes by utilizing tax breaks that come with income taxes. Some claim it is cheating to get a tax break, but it's not. Every incentive you meet the requirements for are yours, guilt-free, and by not accepting tax breaks you are doing yourself a financial disservice. The Judge Learned Hand said that "There is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike, and all do right, for nobody owes any public duty to pay more than the law demands".



Follow these five simple rules when researching tax breaks:

1. Do not falsify information. If certain income exemption, deferment, or cancellation is not applicable, taxes must be paid on that income. Attempting to conceal, change, or make changes about how much money you have made is almost a guarantee that you will be audited, fined, and in some cases, arrested.

2. Obey the spirit as well as the letter of the law. Congress creates doesn't create tax breaks just to be nice. Sometimes they want to boost the economy, sometimes they want to save the environment - whatever the reason, make sure that it applies to you. Bending tax law to fit your situation can be illegal. If you're not sure, consult a tax professional.

3. Tax credits should always be chosen before deductions. Tax credits reduce the amount that you have to pay on your taxes overall while tax deductions just reduce the amount of income you can be taxed on. It makes more sense to choose a tax credit because if you get a large deduction on your taxes, for example $1000, then you still have to pay a certain percent of your taxes with that $1000 subtracted out. It would make more sense if you just accepted a $1000 tax credit you would likely save more because it is a lump sum since if you accepted a deduction you would only see a certain percentage of the $1000 actually taken off of the amount you owe.

4. Make certain you are filing the correct form; for some tax breaks, only a particular tax form will work. Not every taxpayer may file the simplified forms 1040A or 1040EZ. You may need to file the long form 1040. Read all instructions carefully, and if something is unclear, consult a tax preparation professional.

5. Always be sure to watch out for the alternative minimum tax (AMT). It is also known as the "shadow tax system," mostly because it does not follow the same rules as regular income tax. It was made in order to keep a certain minimum tax on people no matter how many deductions one qualifies for. Depending upon your income and type of income you may still have to pay the AMT.

You can begin today - find out what tax benefits you qualify for and start taking a "break" from high taxes!