An effective tax strategy to minimize the taxes you pay is a critical component to anyone’s overall financial plan.
Everyone knows that tax-time is never too far off in the future. As inconvenient and time consuming as filing and paying taxes may be, the IRS-imposed penalties for failure to do so are even less pleasant. Fortunately, there are some methods that may be able to potentially save you money on your next tax bill.
Taxes. Just the word can fill people with anxiety, but the truth is, with careful planning and excellent record keeping, most tax troubles can easily be avoided. Here are some tips for some of the most common sticky tax situations and tax related questions.
Solar tax credits are available for both residential and commercial solar technology implementations which were originally installed in between the above mentioned period, or in case of new home occupancy – If the occupancy date falls in between the above dates. While it is not entirely clear whether the tax credits are available for additional capacity installations or purchase and installation of previously used equipment, the language of the law seems to favor any kind of expenditure on installation of solar technology.
Tax management may not rank high on your list of favorite phrases, but the truth is, staying on top of your taxes now is the only way to prevent IRS headaches later. Here are five essential ways to manage your taxes, and avoid potential trouble:
A critical component of any financial or retirement plan is a comprehensive tax strategy. In a nutshell, the goal of such a strategy is to capitalize on every opportunity the government makes available to you to cut the taxes you will pay on your income, investments, retirement portfolio and estate.
Parenting is one of the most rewarding, and important jobs that a person can have, in addition to being one of the most expensive. The good news is that there are two tax breaks offered by the federal government that the majority of parents can qualify for, which are the dependent exemption and the child tax credit.
Tax planning involves far more than scrambling in April to defer income and boost deductions. If you want to minimize what you pay in capital gains tax, reduce your year-end tax bill, and give less of your estate to Uncle Sam, you should be aware of the short- and long-term tax consequences of all your financial moves.
A qualifying child, as per the IRS, is defined as your son or daughter, stepchild, foster child, brother, stepbrother, stepsister, or a descendant of any of them (for example, your grandchild) who is aged 17 or under, unable to provide for more than 50% of his or her own support, has lived with you for more than half of the tax year and is a U.S. citizen, resident or national. These eligibility requirements are also met by adopted children.
The Coverdell Education Savings Accounts, once known as Education IRAs, can help taxpayers save for a child’s education. Contributions to a Coverdell ESA are nondeductible, but the earnings on the account grow tax deferred and distributions are treated as a tax-free gift to the beneficiary. The contributor does not have to be related to the beneficiary.