Tax Planning Tips that Can Save You a Bundle
Let’s talk about some tax planning tips that can save you a bundle. Most high net worth individuals didn’t get wealth by sitting around and hoping to get rich. They have to earn it. That’s one of the biggest differences between just getting by and actually getting rich. And one of the things high net worth individuals are very good at is their taxes. In other words, they know how to protect their assets by keeping their tax bills low.
So what tax-saving tricks do the wealthy use to keep the taxman away from their wealth? Obviously, we’re not talking about any illegal activity. These are legal tax-saving methods that many wealthy individuals use to keep their tax bill lower and hold onto their assets.
Invest in Real Estate – investing in real estate has long been a path to wealth. As long as you qualify as a real estate professional you can also qualify for some excellent tax benefits. You don’t even have to be a licensed Realtor. With this classification you can reduce your tax bill significantly by using all the strategies available to you.
Own a Business – when you own a business and the objective is to turn a profit, you open yourself to many opportunities to lower your taxes. There are numerous tax deductions and credits for business owners, many of which are not available to W2 employees. This is a great way to reduce your tax bill.
Open a Roth 401(k) – the Roth 401(k) is one of the best ways to save on taxes, especially if you’re wealthy. Here’s why. When you open a Roth you do it with after-tax money. In other words, you’ve already paid income tax on those assets. The great thing about a Roth is any money you earn on the investment grows tax-free. So if you put away $100,000 and you earn $20,000 in interest, you can cash out that money tax-free. But Roth 401(k)s also offer several other flexible options that can help you build wealth.
Smart Qualified Plans – another great strategy for business owners is using a tax-deductible retirement plan to their advantage. People in this situation can really pile up tax deductions and put more money away at the same time. This is really a no-brainer, but not everyone takes advantage of it. Using a 401(k) to save on taxes is not a new concept. And anyone can open a 401(k) retirement savings plan. But business owners can get a huge tax savings because they can increase their deduction amount greatly with a 401(k).
Put These Tax Planning Tips Into Action
If you want to become wealthy, you have to be intentional about it. You can’t sit back and “hope” it happens. After you start your wealth plan and your nest egg begins to grow, put these tax planning tips into place so you can protect the wealth you’ve worked so hard to grow.
If you’re sure how to manage your wealth then hire an experienced financial and tax advisor to the dirty work for you. That way you can sit back and enjoy your assets knowing that they’re being taken care of the right way.
We hope you found this article about “Tax Planning Tips that Can Save You a Bundle” helpful. If you have questions or need expert tax or family office advice that’s refreshingly objective (we never sell investments), please contact us or visit our Family office page or our website at www.GROCO.com. Unfortunately, we no longer give advice to other tax professionals gratis.
To receive our free newsletter, contact us here.
Subscribe to our YouTube Channel for more updates.
Considerately yours,
GROCO, GROCO Tax, GROCO Technology, GROCO Advisory Services, GROCO Consulting Services, GROCO Relationship Services, GROCO Consulting/Advisory Services, GROCO Family Office Wealth, and GROCO Family Office Services.
Alan L. Olsen, CPA, Wikipedia Bio
Proud sponsor of the AD Show.
Will Taxing the Rich Even More Improve Inequality?
Will Taxing the Rich Even More Improve Inequality? It’s been the cry of democratic lawmakers and many of the less fortunate for years: “We need to tax the wealthy even more.” “The rich have to pay their fair share of taxes, too.” The problem is the rich already pay a huge portion of the country’s…
It Pays to Be Rich for These Five Tax Breaks
It Pays to Be Rich for These Five Tax Breaks Although it’s true that the ultra-wealthy are heavily taxed, and in many cases unfairly, there are also some tax break advantages that favor the upper class more than those in the middle. Let’s take a look at some of these breaks. Most common and first…
New Jersey Governor Says Enough is Enough on Taxing the Wealthy
New Jersey Governor Says Enough is Enough on Taxing the Wealthy It seems that no tax is a bad tax when it comes to the “left” side of the government. It’s a well-known fact that the wealthiest Americans pay the largest portion of the country’s taxes. However, there are some government leaders that lean “right”…
Clinton’s Using Careful Strategies to Avoid Tax They Support
Clinton’s Using Careful Strategies to Avoid Tax They Support Have you ever wondered what wealthy democrats do when tax laws they support and vote for come back to apply to them? Although people typically associate being wealthy with republicans, there are plenty of rich democrats in the nations’ capitol as well. So just what do…