Lower Taxes in 7 Easy Steps

Table of Contents......Page 9
1. Winning the War on Taxes......Page 13
Is Tax Planning for You?......Page 14
A Quick Look at the Seven Steps......Page 15
Income Tax 101: How the System Works......Page 16
Icons Used in This Book......Page 22
2. The Best Tax Is No Tax: Income That’s Tax Free......Page 23
Selling Your Home With No Income Tax......Page 26
The Minor Advantage: Tax-Free Income for Children......Page 36
Renting Your Home at No Tax Cost......Page 39
Bonds and Other Tax-Free Investment Income......Page 40
Health Savings Accounts: The Triple Tax Break......Page 52
Employee Fringe Benefits: Don’t Miss These Tax Savings......Page 58
Social Security Benefits: Tax Free Until They’re Not......Page 65
Live and Work Abroad and Avoid U.S. Taxes......Page 68
Don’t Overlook These Other Types of Tax-Free Income......Page 69
3. The Dollar-for-Dollar Advantages: Tax Credits......Page 71
Hybrid Cars: New Wheels and a Tax Break, Too......Page 74
Pain-Free Reduction of Energy and Your Tax Bills......Page 78
Tax Benefits From Your Bundles of Joy......Page 81
Get Educated and Get a Tax Break......Page 85
Save for Your Retirement—Another Tax Benefit......Page 88
Tax Breaks for Good Corporate Citizens......Page 89
The Expatriate Advantage: Credit for Income Taxes Paid Elsewhere......Page 92
Credit to Rehabilitate an Old or Historic Building......Page 94
Benefit From Investing in Low-Income Housing......Page 96
4. Delaying the Pain: Deferring Income and the Tax It Brings......Page 99
Everybody’s Deferral Tool: Retirement Accounts......Page 100
Hold on to Your Investments......Page 123
Happy New Year: Deferring Business Income to Next Year......Page 124
Deferring Employee Compensation: Benefits Served With a Little Risk......Page 126
No Need to Ask: Automatic Interest Deferral on U.S. Savings Bonds......Page 127
Annuities: Complicated, But Sometimes Worth the Trouble......Page 128
Swapping Real Estate: Deferring Taxes on Investment or Rental Property......Page 129
Spreading Out the Profit (and Taxes) With Installment Sales......Page 132
5. Count Every Penny: Reducing Taxable Income With Deductions......Page 135
What Are Tax Donations?......Page 137
Donations Sound Great, But What Are They Really Worth?......Page 138
The Standard Donation: Definitely the Easiest Route and Sometimes the Best One......Page 140
Don’t Miss Out on Itemized Donations......Page 142
Adjustments to Income: Like a Donation, But With a Different Name......Page 175
Do You Have a Business? Don’t Forget to Deduct Your Expenses......Page 178
Make the Most of Your Donations: Plan Ahead for the Greatest Tax Savings......Page 186
6. Join the Low-Tax Rate Club: Reduce Your Tax Rate Through Investing......Page 193
Capital Gains—The Best Rate in Town......Page 194
Dividends: Timing Is Everything When It Comes to Low Rates......Page 205
Tricky Tax Consequences of Buying Mutual Funds......Page 207
Business Property Sales: A Mixed Bag Taxwise......Page 211
What You Can Control: Tips on Lowering Your Tax Rate......Page 212
7. All in the Family: Shifting Income in Your Household to Lower the Tax Burden......Page 223
The Family That Pays Taxes Together Stays Together: How Income Shifting Works......Page 224
Thanks Mom: Giving Your Children Income-Producing Property......Page 227
Give Junior a Job: Employing Your Children to Shift Your Tax Burden......Page 238
Who Said Never Hire Your Relatives?......Page 241
8. Cover the Basics: Making the Most of Your Filing Status and Tax Exemptions......Page 245
Choosing the Classification for You......Page 246
Taking All the Tax Exemptions You Deserve......Page 257
9. Help Beyond This Book......Page 271
Information From the IRS......Page 272
Other Online Tax Resources......Page 273
Tax Publications......Page 274
Consulting a Tax Professional......Page 275
Index......Page 277