SUBSTANTIALLY reducing taxable income?
I am in 25% tax bracket due to some land I sold for short term gain. I would like to reduce my taxable income by 50K? What are some creative legal ways to reduce taxable income by 50K. This would be for 2008 taxes so I have time.
Public Comments
- Contribute to an IRA. Donate to charities. Sell other assets for a capital loss.
- Maximum contributions to IRA for self and spouse. Sell off stock or property for loss to offset the gain. Short-term losses are used up first, then long term. Donate to charities. Look at all possible Schedule A deductions.
- A few ideas: - Does your employer offer a 401K plan? You can put up to $20,500 into that. - If you're eligible, you can max out your traditional deductible IRA for additional deduction = $5,000 (unless you're over 50 years old, then you can do an additional $1,000). - Take a look at your 1040 form, lines 23 - 35 and see what additional adjustments to income you might be able to take. - Also, look at Schedule A deductions to see what you can take advantage of. - Finally, if you've had some stocks that haven't performed well, you can take a capital loss on those (line 13 on the 1040 form). ==========
