Ways to reduce taxable income | TigerDroppings.com
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jimbeam
USA Fan
University of LSU
Member since Oct 2011
37643 posts

Ways to reduce taxable income

Putting the horse in front of the carriage here, but I plan (and hope I'm on the way) of having a successful career and all that jazz. With the way our future looks (to me) the wealthy will be supporting this country more and more.

What are some ways that people don't realize they can reduce taxable income?(legally of course)


MoreOrLes
LSU Fan
Member since Nov 2008
18582 posts

re: Ways to reduce taxable income
HSA
PreTax IRA
Max on the 401K



TJG210
LSU Fan
New Orleans
Member since Aug 2006
23294 posts
Online

re: Ways to reduce taxable income
Goodwill Donations!


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jimbeam
USA Fan
University of LSU
Member since Oct 2011
37643 posts

re: Ways to reduce taxable income
quote:

PreTax IRA
b/c if you're making bank there's a good chance you can't do a roth anyway right?


iknowmorethanyou
LSU Fan
Paydirt
Member since Jul 2007
5067 posts

re: Ways to reduce taxable income
Right. Maxing out life insurance is referred to as "The Rich Man's Roth"...obviously no tax deductions though.

ETA: Folks have had success with cattle, but it's cyclical.
This post was edited on 7/10 at 4:21 pm


jimbeam
USA Fan
University of LSU
Member since Oct 2011
37643 posts

re: Ways to reduce taxable income
currently single and the near future looks to remain that way. would I even need life insurance


iknowmorethanyou
LSU Fan
Paydirt
Member since Jul 2007
5067 posts

re: Ways to reduce taxable income
Not the death benefit, but the tax-deferred and potentially tax-free income from the policy cash value is worth a looksee.


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gatorsimz
Florida Fan
cafe risque
Member since Feb 2009
5522 posts

re: Ways to reduce taxable income
quote:

b/c if you're making bank there's a good chance you can't do a roth anyway right?



you can't deduct your IRA contributions if you're making bank. you can contribute but pay taxes

ETA: that's if you're covered by a retirement plan at work
This post was edited on 7/10 at 4:47 pm


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gatorsimz
Florida Fan
cafe risque
Member since Feb 2009
5522 posts

re: Ways to reduce taxable income
Also..

quote:

With the way our future looks (to me) the wealthy will be supporting this country more and more.


wouldn't that mean higher taxes in the future on the wealthy. if you believe this then you'd want to limit your future tax liability


Bubba Bexley
LSU Fan
Member since May 2007
3579 posts

re: Ways to reduce taxable income
You could give it all to TAF


MG
LSU Fan
New Orleans
Member since Dec 2007
271 posts
Online

re: Ways to reduce taxable income
Hide your money in Iraqi Dinars. Profit.


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jimbeam
USA Fan
University of LSU
Member since Oct 2011
37643 posts

re: Ways to reduce taxable income
Exactly


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TigerTatorTots
New Orleans Pelicans Fan
Mandeville, LA
Member since Jul 2009
69371 posts

re: Ways to reduce taxable income
Someone on the same subject- is buying physical metals a tax write off?


TJG210
LSU Fan
New Orleans
Member since Aug 2006
23294 posts
Online

re: Ways to reduce taxable income
quote:

is buying physical metals a tax write off?


I don't think so, but out of curiosity, what makes you think it would be?


wegotdatwood
Member since Aug 2009
17094 posts

re: Ways to reduce taxable income
Will the saver's credit still be around next year? After deductions we'll be south of 53k. We'll get 10% credit of the $6700 we've put in retirement accounts this year.

It doesn't matter the type either. 401k, roth, traditional etc.


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Poodlebrain
LSU Fan
Way Right of Rex
Member since Jan 2004
17396 posts
Online

re: Ways to reduce taxable income
There are three different concepts of income to keep in mind. The first is gross income. You can reduce your gross income by incurring losses, or simply earning less income. You can also try to influence the character of the income you earn to minimize your tax liability. This is done primarily through investment decisions.

The second is adjusted gross income. Adjustments to income include things like qualified retirement plan contributions, HSA contributions and certain education expenses. Some of the adjustments to income are limited by types of gross income you earn. Minimizing adjusted gross income is beneficial since some deductions and credits are limited based on a taxpayer's AGI.

The third is taxable income, and it is simply your AGI less allowable deductions. The only discretionary deductions are charitable contributions, and they are limited to a percentage of AGI based on the type of property contributed and the type of organization.

Effective tax planning can be quite complicated as it needs to focus on all three areas, and it should take into consideration multiple years rather than just a single year.


BestBanker
LSU Fan
stuck in a moment
Member since Nov 2011
4089 posts

re: Ways to reduce taxable income
Legitimately there are only two ways to answer your question:
Don't accept it as income, and/or
Give it away.


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RickAstley
LSU Fan
Reno, Nevada
Member since May 2011
1663 posts

re: Ways to reduce taxable income
You could try listing yourself as Democrat. You're less likely to be targeted for underpaying that way


jimbeam
USA Fan
University of LSU
Member since Oct 2011
37643 posts

re: Ways to reduce taxable income


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wegotdatwood
Member since Aug 2009
17094 posts

re: Ways to reduce taxable income
PB, will the savers credit still be in place next tax season?
This post was edited on 7/11 at 2:12 pm


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