1. TurboTax /
  2. Tax Calculators & Tips /
  3. Tax Tips Guides & Videos /
  4. Investments and Taxes /
  5. Best Investments for Boosting Your Tax Refund

Best Investments for Boosting Your Tax Refund

Updated for Tax Year 2019


OVERVIEW

If you're like most taxpayers, you're expecting a tax refund this year. The average refund amount for tax year 2019 was $2,725. If you want to boost your tax refund, consider investing in your retirement or your home before filing your taxes.


Folded bills on wood

Retirement Contributions Lead to Bigger Tax Refunds

Favorable tax provisions for retirement planning make investing in your nest egg one of the best ways to boost your tax refund. The IRS even allows you to benefit twice when it comes to a traditional individual retirement account, or IRA. This unique opportunity allows you to both deduct up to a certain limit and get a refundable credit if you earned less than a certain amount of money.

Here's how to take advantage of the same retirement contribution twice to maximize your tax refund:

  • Take the deduction for a traditional IRA, which is limited to $6,000 as of tax year 2019 (or $7,000 for filers ages 50 and up).
  • You can then get an additional credit of up to $1,000, or $2,000 if filing jointly, when you contribute to an IRA or certain other qualified plans. This tax benefit is known as the Saver's Credit, also called the Retirement Savings Contribution Credit.

If you are eligible, you can open a traditional IRA and claim the credit for the previous year up until the upcoming tax deadline, which typically falls around April 15.

Roth IRAs work a bit differently when it comes to boosting your tax refund. You can't deduct Roth IRA contributions, but they do qualify for the Saver's Tax Credit.

Other retirement plans that qualify for the credit include:

  • 401(k)
  • 403(b)
  • SIMPLE IRA
  • SARSEP, or Salary Reduction Simplified Employee Pension Plan

Tax credits boost your refund more so than deductions, but they aren't available to filers at all income levels. They tend to favor taxpayers with low and moderate incomes.

To take advantage of the Saver's Credit for tax year 2019:

  • Single taxpayers can earn no more than $32,000
  • Heads of household can earn no more than $48,000
  • Married taxpayers who filed jointly can earn no more than $64,000

By answering a few simple questions when filing your tax return with TurboTax, you'll receive recommendations for credits and deductions that are specific to your income and situation, boosting your tax refund.

Get Some Credit for Being Energy Efficient

Energy-saving improvements to your home pay off in a couple of ways: You save money over time through low or no energy bills and you get to take advantage of tax credits.

  • For example, through the Residential Energy Efficient Property Credit, you can invest in an alternative energy system and claim 30% of the cost of the system through 2019.
  • After that, you can still claim a reduced percentage of the cost through 2021 for solar electric and solar water systems. The credit applies only to your primary residence and second home, not to rental or investment real estate.

Improvements that the credit covers include qualified:

  • solar electric systems
  • solar water heaters
  • small wind energy turbines
  • fuel cell property (through 2016 only)

The Nonbusiness Energy Property Credit ended on December 31, 2016. Although it didn't offer as much as the Residential Energy Efficient Property Credit, the qualifying improvements were more basic and affordable.

The credit was limited to $500 over your lifetime, and you could claim up to 10% of the cost of doors and windows (not including installation costs). Your windows and doors had to have a manufacturer's certification statement to qualify for the credit.

Remember, with TurboTax, we’ll ask you simple questions and fill out the right tax forms for you to maximize your tax deductions.

Get every deduction you deserve

TurboTax Deluxe searches more than 350 tax deductions and credits so you get your maximum refund, guaranteed.

For only $59.99*
Start for Free

Looking for more information?

* Important Offer Details and Disclosures

TURBOTAX ONLINE/MOBILE

  • Try for Free/Pay When You File: TurboTax online and mobile pricing is based on your tax situation and varies by product. $0 federal (for simple tax returns) + $0 state + $0 to file offer only available with TurboTax Free Edition; offer may change or end at any time without notice. Actual prices are determined at the time of print or e-file and are subject to change without notice. Savings and price comparisons based on anticipated price increase. Special discount offers may not be valid for mobile in-app purchases.

  • QuickBooks Self-Employed Offer with TurboTax Self-Employed and TurboTax Live Self-Employed for Extension Filers: To receive your complimentary subscription to QuickBooks Self-Employed through 10/31/20, you must pay for your 2018 TurboTax Self-Employed or TurboTax Live Self-Employed return between 4/16/19 and 10/15/19 and sign-in and access your QuickBooks Self-Employed account via mobile app or at https://selfemployed.intuit.com/turbotax at least twice by 12/31/19. You will have the option of renewing your QuickBooks Self-Employed subscription by 10/31/20 for another year at the then-current subscription rate. You may cancel your subscription at any time from within the QuickBooks Self-Employed billing section. See https://quickbooks.intuit.com/self-employed/ for price comparison. Offer not valid for existing QuickBooks Self-Employed subscribers already on a payment plan.

  • Pays for itself (TurboTax Self-Employed): Estimates based on deductible business expenses calculated at the self-employment tax income rate (15.3%) for tax year 2018. Actual results will vary based on your tax situation.

  • Anytime, anywhere: Internet access required; standard data rates apply to download and use mobile app.

  • Fastest refund possible: Fastest tax refund with e-file and direct deposit; tax refund time frames will vary. The IRS issues more than 9 out of 10 refunds in less than 21 days.

  • Pay for TurboTax out of your federal refund: A $39.99 Refund Processing Service fee applies to this payment method. Prices are subject to change without notice.

  • TurboTax Help and Support: Access to a TurboTax specialist is included with TurboTax Deluxe, Premier, Self-Employed and TurboTax Live; not included with Free Edition (but is available as an upgrade). TurboTax specialists are available to provide general customer help and support using the TurboTax product. SmartLook on-screen help is available on a PC, laptop or the TurboTax mobile app. Service, area of expertise, experience levels, wait times, hours of operation and availability vary, and are subject to restriction and change without notice.

  • Tax Advice, Expert Review and TurboTax Live: Access to tax advice and Expert Review (the ability to have a Tax Expert review and/or sign your tax return) is included with TurboTax Live or as an upgrade from another version, and available through December 31, 2019. These services are provided only by credentialed CPAs, EAs or tax attorneys. Some tax topics or situations may not be included as part of this service, which shall be determined in the tax expert’s sole discretion. For the Assist & Review product, if your return requires a significant level of tax advice or actual preparation, the tax expert may be required to sign as the preparer at which point they will assume primary responsibility for the preparation of your return. For the Full Service product, the tax expert will sign your return as preparer. Administrative services may be provided by assistants to the tax expert. Payment by federal refund is not available when a tax expert signs your return. On-screen help is available on a desktop, laptop or the TurboTax mobile app. Unlimited access to TurboTax Live CPAs and EAs refers to an unlimited quantity of contacts available to each customer, but does not refer to hours of operation or service coverage. Service, area of expertise, experience levels, wait times, hours of operation and availability vary, and are subject to restriction and change without notice.

  • Tax Return Access, Smart Insights and My Docs features: Included with TurboTax Deluxe, Premier, Self-Employed, TurboTax Live or with PLUS benefits. Access to the prior seven years of tax-related documents we have on file for you is available through 10/31/2020. Terms and conditions may vary and are subject to change without notice.

  • Easy Online Amend: Included with TurboTax Deluxe, Premier, Self-Employed, TurboTax Live or with PLUS benefits. Make changes to your 2018 tax return online for up to 3 years after it has been filed and accepted by the IRS through 10/31/2021. Terms and conditions may vary and are subject to change without notice.

  • #1 best-selling tax software: Based on aggregated sales data for all tax year 2017 TurboTax products.

  • Most Popular: TurboTax Deluxe is our most popular product among TurboTax Online users with more complex tax situations.

  • CompleteCheck: Covered under the TurboTax accurate calculations and maximum refund guarantees.

  • #1 rated online tax prep provider: Based on independent comparison of the best online tax software by TopTenReviews.com January 29, 2018.

  • Get tips from Turbo based on your tax and credit data to help get you to where you want to be: Tax and credit data accessed upon your consent.

TURBOTAX GUARANTEES

  • 100% Accurate Calculations Guarantee: If you pay an IRS or state penalty or interest because of a TurboTax calculation error, we’ll pay you the penalty and interest.

  • Maximum Refund Guarantee - or Your Money Back: If you get a larger refund or smaller tax due from another tax preparation method, we'll refund the applicable TurboTax federal and/or state purchase price paid. TurboTax Online Free Edition customers are entitled to payment of $14.99.

  • 100% Accurate Expert Approved Guarantee: If you pay an IRS or state penalty (or interest) because of an error that a TurboTax CPA, EA, or Tax Attorney made while providing topic-specific tax advice, a section review, or acting as a signed preparer for your return, we'll pay you the penalty and interest.

  • Audit Support Guarantee:
  • If you received an audit letter based on your 2018 TurboTax return and are not satisfied with how we responded to your inquiry, we’ll refund the applicable TurboTax federal 1040 and/or state purchase price you paid. TurboTax Free Edition customers are entitled to payment of $14.99. We will not represent you or provide legal advice. Excludes TurboTax Business.

  • TurboTax Free Guarantee:
  • $0 Federal + $0 State + $0 To File offer is available for simple tax returns with TurboTax Free Edition. A simple tax return is Form 1040 only, with no attached schedules.

  • Satisfaction Guaranteed:
    • If you use TurboTax Online or Mobile:
      Satisfaction Guaranteed — or you don't pay. You may use TurboTax Online without charge up to the point you decide to print or electronically file your tax return. Printing or electronically filing your return reflects your satisfaction with TurboTax Online, at which time you will be required to pay or register for the product.

    • If you bought or downloaded TurboTax from a retailer:
      Try TurboTax software. If you're not satisfied, return it to Intuit within 60 days of purchase with your dated receipt for a full refund.

    • If you bought or downloaded TurboTax directly from us:
      Try TurboTax software. If you're not satisfied, return it within 60 days of shipment with your dated receipt for a full refund (excluding shipping & handling).

TURBOTAX CD/DOWNLOAD

  • Installation requirements: Product activation required via Internet. Install on up to 5 of your computers. Download option requires free online Intuit account. You must accept the TurboTax License Agreement to use this product (www.TurboTax.com/softwarelicense). Not for use by paid preparers.

  • TurboTax CD/Download products: Price includes tax preparation and printing of federal tax returns and free federal e-file of up to 5 federal tax returns. Additional fees apply for e-filing state returns. E-file fees do not apply to New York state returns. Savings and price comparison based on anticipated price increase. Prices subject to change without notice.

  • Fastest refund possible: Fastest tax refund with e-file and direct deposit; tax refund time frames will vary. The IRS issues more than 9 out of 10 refunds in less than 21 days.

  • Pay for additional TurboTax services out of your federal refund: A $39.99 Refund Processing Service fee applies to this payment method. Prices are subject to change without notice. This benefit is available with TurboTax Federal products except TurboTax Business.

  • About our TurboTax Product Experts: Customer service and product support vary by time of year.

  • #1 best-selling tax software: Based on aggregated sales data for all tax year 2018 TurboTax products.

  • Data Import: Imports financial data from participating companies; may require a free Intuit online account. Quicken and QuickBooks import not available with TurboTax installed on a Mac. Imports from Quicken (2017 and higher) and QuickBooks Desktop (2017 and higher); both Windows only. Quicken import not available for TurboTax Business. Quicken products provided by Quicken Inc., Quicken import subject to change.