Lower Your Taxes
By William Perez, About.com Guide
Tax Basics
Understanding how the tax system works is the first key to lowering your taxes.
- 5 Basic Tax Ideas
- 3 Basic Ways to Reduce Your Taxes
- Understanding Your W-2
- How One Couple Eliminated Their Taxes
- Tips for Filing Your First Tax Return
- Avoid Taxes When Selling Your Home
- Capital Gains Can Lower Your Tax Rate
- Paying Estimated Taxes
- Tips for Freelance Contractors
Filing Status
Choosing the right filing status impacts your tax rates, standard deduction, and various limits on tax deductions. Choosing the best filing status can go a long way to making sure you are paying the right amount of tax.
Dependents
Who can you claim as a dependent on your tax return? The answer may surprise you. Congress changed the law regarding dependents in 2005, causing confusion for taxpayers and professionals alike. Being able to claim a dependent will help lower your taxes by increasing your personal exemptions and qualifying you for various child-related tax credits.
- New Law for Claiming Dependents
- Complications with the New Law for Dependents
- Rules for Qualifying Relatives
- Residency Requirements for Qualifying Relatives
- Pre-2005 Law for Dependents
Investing and Taxes
Taxpayers who invest in stocks, bonds, mutual funds, or real estate can benefit from the lower tax rate on long-term gains. Homeowners in particular can exclude up to half a million dollars in profits when they sell their primary residence. By shifting investment income to long-term gain, you can lower your taxes significantly.
- Capital Gains Essentials
- Capital Losses and Limitations
- Short and Long-Term Holding Periods
- Types of Capital Assets
Popular Tax Breaks
Some of life's bigger expenses can help lower your taxes. Here's a list of common expenses can will help qualify you for a deduction or tax credit.