Expert shares how to maximize your tax refund

JACKSON, Tenn. — The deadline to file your taxes is quickly approaching. Experts say it’s not about how much you make, it’s about how much you keep.

A common mistake many make is treating your tax refund like free money. Finance experts say it’s not — it’s an opportunity and it starts with knowing what is available to you. For example, the earned income tax credit or EITC.

“Its actually cash back in your pocket, but as long as your income is up to a certain threshold,” said Greg Clement, personal finance expert for Freedomology.

Around 20% of those eligible miss out because they do not think they qualify. According to the IRS, in Tennessee, the average EITC amount received in tax year 2023 was more than $2,800.

Experts say to put that refund into something that creates long-term value. For example, a health savings account or a high-yield savings account. It is also recommended to use a professional and file electronically.

“It’s faster, it reduces errors and that direct deposit component means it’s going to get your refund quicker,” said Clement.

If your only source of income is through your job, experts suggest starting your own business.

“I think a huge benefit would be to become an entrepreneur, you know, start a side hustle or a business. You have so many more deductions and credits available if you are actually trying to generate income through an asset like a small business,” said Clement.

It’s also recommended to use your refund to invest in stocks or buy a course to learn high-value skills like generative AI or data analysis.

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