| Despite its association with death, taxes aren't | | | | state taxes. |
| always that bad. A few of us even get quite a bit of | | | | 3. Use tax credits to your advantage - what are tax |
| money back come tax season. And at the very least | | | | credits? Tax credits are an excellent way to reduce |
| there are ways to curb the eventual April blow by | | | | taxes. Things such as adopting children, paying for |
| planning ahead. Oftentimes, the ways in which people | | | | college education, investing in retirements plans come |
| can offset taxes are financially beneficial as well. As | | | | with tax credits that can be used to reduce the |
| cumbersome as tax planning is, there are a few basic | | | | taxes to be paid. Some examples of tax credit items |
| ways you can learn to save before you're pouring | | | | are the EIC (Earned Income Credit), retirements |
| over old receipts at the 11th hour... | | | | plans, IRA, education at college and above level, etc. |
| Taking a Bite Out of Tax | | | | 4. Use a tax planner - it is advisable to use a tax |
| 1. Reduce Your Adjusted Gross Income (AGI) - The | | | | planner every 2-3 years so one would learn from the |
| American Dream is often emulates thoughts of | | | | returns filed how tax returns are correctly calculated. |
| endless prosperity and capital gain. In reality though, | | | | A tax planner would also be the source of invaluable |
| at least the taxable reality we know, the more one | | | | advice regarding what type of investment needs to |
| makes, the more the government taketh away. | | | | be done when so as to keep the taxes due at the |
| There are ways however, to climb the economic | | | | minimum possible, while still living on the good side of |
| ladder and stowe away hard earned cash rather than | | | | the law. |
| throw it away. what are some ways you can | | | | 5. Research, research, research - continuous updating |
| accomplish this? Very simple - a good portion of your | | | | and research is needed on taxation so as to learn |
| income could be invested into retirement plan (a | | | | (among the first) what the new rules about taxes |
| 401(K) would be a good choice). Other deductions | | | | are; what are the best ways to profit from |
| that will reduce your AGI include money paid towards | | | | exemptions, and so on. Use the Internet to |
| education and an IRA fund. It is important to | | | | accumulate all the pertaining information that would |
| remember that all deductible contributions are | | | | be helpful when working out the exact amount you |
| itemized on the Form 1040, and starting now will | | | | owe the Government. Besides the Internet, there |
| save a ton of time come April. | | | | are other places as well - tax software programs |
| 2. Maximize Tax Deductions - Deductible items such | | | | which do all the calculations for your automatically, |
| as interest paid on mortgage payments, charity | | | | the local library where tax and tax returns would |
| contributions, medical expenses, dependents, | | | | have hundreds of chronicles, seminars/ workshops, |
| education, marriage, can all take an edge off your | | | | freelancing agents. |
| taxable income. You can also deduct state sales tax | | | | Follow any of the above or a combination about two |
| when a state income tax deduction is not available or | | | | or more to get the best out of the tax planning and |
| amounts to less of the two. All investment related | | | | payment. |
| expenses would also be tax deducible as well as all | | | | |