Just filed the taxes and paid a hefty amount of tax. Need to do proper tax planning for 2018 especially coz SALT deductions would be capped to 10K and for folks renting their homes, mortgage interest deduction was anyways not an option. Although no one buys home to save on tax, but looks like even new home owners would be able to deduct maximum 31K (interest for whole year on 750K loan @4.25% approx values ) and add 10k SALT, brings deductions to around 40K. Standard deduction would be 24K. So that would mean different of 16K. Share your best ways of saving your money from Uncle Sam!
Not much you can do about your w2 income being taxed, aside from moving to a no-income-tax-state.
Not reporting earnings has made taxes pretty straightforward for me
Wht u mean?
This is the IRS b rite over k thx.
Max out 401k. Get married.
Doesn’t help if your partner is a high earner as well.
In fact it hurts. We've though of strategic divorce to stop paying an extra 10 to 15k a year in taxes.
Open a business. Unlimited deductions over there. That’s what I heard in most of the tax seminars I have been to. Going forward it would be personal plus business income which would give the max benefit.
Like an LLC or an actual business?
Itemize and depreciate what you can. Work with an accountant if it's worth it. Also, if you get get an investment property, that sweet sweet depreciation is a nice offset.
What do you mean depreciation on the investment property? Hopefully that property would be increasing in value right?
Yes, that's the ridiculous beauty of it. Half the reason why people get into real estate. Basically, you take how much you paid upfront for it (cost basis), figure out the building value (subtract the land, which is maybe 20% of the value), and for the period where you have tenants, you can pretend the value of the building is linearly depreciating over 27.5 years, and treat it as an operating expense... Regardless of what property values are doing. (I am not an accountant, nor do I play one on TV)
Earn less