Tax Advantaged Options

Conroe_Ag_8

Joined: Oct 10, 2021

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9:06a, 3/3/24

AG

Howdy, looking for advice on reducing tax exposure each April. Currently have maxed out 401k and HSA. Just curious what else I can be doing with my money to keep it and reduce tax exposure. Likely going to hire CPA this year (open to suggestions).

Also, am I correct in understanding that if my tithing doesn't exceed the MFJ minimum deduction threshold, I would have been better off (tax wise, not morally) not donating at all?

TIA

aunuwyn08

Joined: Jan 10, 2006

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10:16a, 3/3/24

AG

If you buy a rental property you can deduct operating losses like depreciation from your top line.

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YouBet

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10:30a, 3/3/24

AG

Try not to make enough money that puts you in the top 45% of earners that actually pay taxes.

Other than that, I would get a CPA and let them figure this out for you.

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Pinochet

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In reply to Conroe_Ag_8 • 11:11a, 3/3/24

Not quite correct on the tithing. You are no better off but not worse off if your charitable contributions and other itemized deductions (taxes, mortgage interest, etc) don't exceed the standard deduction.

If you are close, see how stacking your deductions would impact it. That means pay your real estate taxes in January 2024 and December 2024, then not again until January 2026 and December 2026 (careful of $10k yearly max deduction). Do the same with your charitable contributions. Tithe for the year in January 2024 and then do the 2025 tithe in December 2024. That will result in you alternating between standard and itemized deductions each year, potentially getting significantly more benefit than if you did everything the same each year.

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nactownag

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3:03p, 3/3/24

AG

Do you have any highly appreciated securities in a non retirement account? Consider setting up a donor advised fund and donating the securities. Preferably you would donate two or three years worth of giving so you can itemize.

By doing this you win two ways:

1: itemize your return and lower taxes
2: avoid paying capital gains on the appreciated security

I made a YouTube video explaining this in more detail

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