Tax and Insurance
September 15th, 2020
Help and How To’s in Trying to Reduce Your Taxable Income
Let’s face it: taxes are overwhelming. They are hard to understand, and even harder to manage. We want to simplify this concept and give a couple ways to reduce your taxable income to Uncle Sam.
As your income increases your tax rate increases. The complexity arises from the various types of income as well as deductions and credits available to taxpayers that plan carefully. The tax code, however, has a number of loopholes within itself which a CPA can help taxpayers sort through.
Can you as the average American reduce your tax bill?
Regardless of your income, it is financially wise to take any available tax deductions and credits you qualify for.
So, how do you reduce your taxable income?
- Contribute as much as you can to pre-tax retirement savings plans
- Participate in pre-tax health savings accounts like HSAs
- Pay attention to potential tax credits
- Practice tax-loss harvesting with your investments