Hereâs how you can significantly decrease the amount of taxes you owe or boost your refund by saving for retirement and investing for the future. Maximize your deduction. You can contribute up to $5,500 to an IRA in tax-year 2014, or $6,500 if you are age 50 or older.If a worker in the 25 percent tax bracket contributes $5,500 to an IRA, he will save $1,375 on his 2014 tax bill.If you make a contribution to an IRA and youâre in the 25 percent tax bracket, a $1,000 contribution is actually only costing you $750, and actually less if you are in a state that charges income taxes.â. Check your eligibility.