Most people assume that their mortgage or rent, student loans, or childcare costs eat up the majority of their income, but the truth might surprise you. Most of your money has gone—and continues to go—to taxes.

There are federal/state income taxes, Social Security taxes, payroll taxes, sales taxes, property taxes and more. In fact, if you take a close look at how much you pay for various taxes, chances are this number would be more than 50 percent of your overall expenditures.

While no one can avoid taxes completely—not legally anyway—there are almost certainly ways to reduce your bill. If you want to change your taxes from your biggest expense to your biggest saving opportunity, here are a few tips:

A trusted financial advisor

Find an advisor whose primary goal will be to help you achieve your long-term financial objectives. You need a financial planner who can analyze your status and assist you in setting up and implementing a program to achieve your ultimate goal of financial independence. Develop a close relationship with your advisor. The better your financial advisor knows you, the more effective they will be at finding tax credits, deductions, etc., that apply to you.

Get organized

Do not walk into your tax preparer’s office with your W-2 and a few receipts and expect to have a wealth-building experience. Tax records, such as records of income received, work-related expense reports, medical expense information, information about home improvements, sales, refinances and so on should be carefully kept on a year-round basis.

Retro-file of missed deductions

Using your taxes as a way to actually save money is probably a new concept for you. Chances are high that you have missed out on ways to save in years past. Some good news is that those savings are not lost forever. You can file an amended return to claim an additional refund. Generally, the statute of limitations is three years from the date you filed your tax return.

Get credit for your kids

Put together a list of all expenses related to your kids. You will want to include child care, tuition payments, 529 plan contributions, donations, medical expenses, etc. Ask your tax preparer to explore every tax credit that might be available to you, such as the child care credit, child tax credit and the earned income credit. For older children who are in college, you must consider the education tax credits, such as the Lifetime Learning Credit and the American Opportunity Tax Credit.

Taxed and untaxed insurance payouts

Generally, the cost of personal homeowner’s, automobile, and boat and umbrella liability insurance are not tax deductible. However, insurance reimbursements to the extent of your loss are generally not taxable. Keep in mind that if you own a rental property, you can generally deduct most of the expenses associated with maintaining and managing the property, including the cost of property insurance.

Retire from a big tax burden

Many Americans are not saving enough for retirement. If your employer offers a 401(k) plan, invest as much as it will allow. Making elective salary deferrals to your company’s retirement plan allows you to defer tax on your salary and get a tax-deferred buildup of earnings within your plan until you start making withdrawals when you retire. Other options include IRAs, which are available to all wage earners at any salary level, as well as to nonworking spouses.

Contributions to traditional IRAs may be tax deductible if you meet the requirements, which gives you a tax deduction in the current year and a tax deferral for any earnings, but ultimately you will pay tax when you withdraw from your account.

Contributions to a Roth IRA are not tax deductible, but qualified withdrawals are tax free, which gives you a tax deduction in the current year, but ultimately your qualified withdrawals including earnings will be paid out to you tax free. Compare the benefits of a traditional IRA to a Roth IRA and choose the one that is best for your particular situation.

Get the most out of Social Security

If you are collecting Social Security benefits, up to 85 percent of these benefits could be subject to federal income tax. However, it is important to note that you can avoid paying income tax on your Social Security benefits depending on your provisional income. Planning your retirement income to include tax-free withdrawals, such as from a Roth IRA account, may allow you to keep your income under these thresholds and ultimately avoid paying tax on your Social Security benefits.

Do not get taxed by your health

Take full advantage of medical insurance premiums paid by your employer on your behalf. This is considered a tax-free fringe benefit. These medical insurance premiums are 100 percent deductible by your employer and tax free to you. If your health insurance qualifies as a high-deductible plan, you should establish an HSA and fully fund tax-deductible contributions to cover future medical expenses.

Do not let taxes deflate your ROI

Inflation and taxes are perhaps the two biggest drains on your investment returns. When investing, you must always consider the tax consequences of your investment when determining your true rate of return or you may be paying significantly more in taxes than the law requires.

Give a gift

Take advantage of gifting strategies that can help you prevent losing some of the value of your estate to taxes. Making a gift in the right amount to anyone every calendar year will not be subject to gift tax or included in your taxable estate. Furthermore, it will not be added back to your lifetime exemption. This can be a great way to transfer assets to children, grandchildren and other intended heirs while you are still alive.

When you understand how paying your taxes work and know where to look for opportunities, you can actually minimize your tax payout. As a result, you save a lot more money and can then pave your way to financial independence.

By John J. Vento, author of "Financial Independence (Getting to Point X)"