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Timecodes
0:00 Video Overview
0:34 Tax Deductible Investment
1:01 Rental Real Estate
5:19 Oil & Gas
8:07 Traditional 401K
9:08 Traditional IRA
9:59 Health Savings Account
11:10 Key Points
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*Disclaimer: I am not a financial advisor nor am I an attorney. This information is for entertainment purposes only. It is highly recommended that you speak with a tax professional or tax attorney before performing any of the strategies mentioned in this video. Thank you.
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We all know that no one likes paying taxes. However, there are certain investments that can help reduce your tax burden significantly. By taking advantage of tax-saving investment strategies, you can keep more money in your pocket and potentially grow your wealth over time. Here are five investments that can help you reduce your taxes massively:
1. Retirement Accounts: Contributing to retirement accounts like a 401(k) or an Individual retirement account (IRA) can lower your taxable income and reduce your tax bill. These accounts offer tax-deferred growth on your investments, meaning you won’t pay taxes on the gains until you withdraw the money during retirement. Additionally, some retirement accounts offer tax deductions for your contributions, further reducing your tax liability.
2. Health Savings Account (HSA): A Health Savings Account is a tax-advantaged account that allows you to save money for medical expenses. Contributions to an HSA are tax-deductible, and withdrawals for qualified medical expenses are tax-free. By investing in an HSA, you can reduce your taxable income and save on taxes while preparing for future healthcare costs.
3. Real Estate Investments: Investing in real estate can offer several tax benefits, including deductions for mortgage interest, property taxes, and depreciation. Rental properties can generate passive income that is often taxed at a lower rate than ordinary income. Additionally, if you sell a rental property after holding it for a certain period, you may qualify for capital gains tax rates, which are typically lower than ordinary income tax rates.
4. Municipal Bonds: Investing in municipal bonds can provide tax-free income. Interest earned from municipal bonds is exempt from federal income tax and may also be exempt from state and local taxes, depending on where you live. By investing in municipal bonds, you can generate tax-free income and potentially reduce your overall tax burden.
5. Opportunity Zone Investments: Opportunity Zones are designated economically distressed areas that offer tax incentives for investors. By investing in Opportunity Zone Funds, you can defer and potentially reduce capital gains taxes. If you hold your investment for at least 10 years, you may be able to exclude all gains from the Opportunity Zone investment, resulting in significant tax savings.
In conclusion, these five investments can help you reduce your taxes massively and keep more of your hard-earned money. It’s essential to consult with a financial advisor or tax professional before making any investment decisions to ensure they align with your financial goals and overall tax strategy. By taking advantage of tax-saving investment opportunities, you can minimize your tax liability and maximize your wealth-building potential.
Great tax strategies and a reminder to protect your real estate and safe assets outside of retirement plans in separate entities. Just start with a complete formation so you have long-term protection.
Small taxes can affect investment decisions such as whether to choose tax-free municipal bonds over taxable bonds or do a Roth IRA conversion. I’ve been sitting on over $745K equity from a home sale and I want to invest on the stock market, how do I achieve this without being taxed twice?
Putting half of my Salary into my portfolio at the start of each month has always been my approach. My second approach is to hold off on selling for at least five years, but as of late, my portfolio has seen a significant fall with losses of around $65k, Please what can i do?
Real Estate may have tax benefits but you have to factor in unless you do a 1031 Exchange you pay taxes on a lumped together larger profit sum. Stocks, ETF's I can control the profits taken each year so I'm not pushed into high tax brackets. Buyers cost, selling cost, vacancy rates, no control if in HOA and maintenance fees increase dramatically(Florida), property insurance increases, homeowners insurance increases, compared to just investing in long term quality ETF's. Older house and neighborhood gentrification. Also about deductions I punched in the tax software and I was getting 21% reduction from the deduction amount. So $1000 deduction is only reducing your taxes paid by $210 not $1000.
Can ANYONE tell or show me the best way to organize my paperwork to give to the book keeper / CPA to do the taxes???
My accountant mentioned that the 401k would give me 1/3 for write off, not 100% . Can someone explain this?
No mention of 529?
I can't wait to hear more about ways to invest in oil and gas!
I need lawer recommendations to open my LLc related to Short term rental, I'm south bay Los Angeles, any recommendations please ?
I’d be retiring/working much less in 5 years and curious to know best how people split their pay, how much of it goes into savings, spendings or investments. I earn around $250k per year, but nothing to show for it yet.
This is so helpful. Thank You so much.
Hello Karlton! I’m a staff accountant and a top 25 firm in southeastern US. I really enjoy your videos because it’s things that I don’t always see on a day to day basis. I understand tax prep very well but I yet to discuss tax planning with clients. Appreciate your vids
Bro good videos!
Your thoughts about CHILIZ? Analysts suggesting a price target of 2 dollar. Sounds like a good buy. Your thoughts?
I thought you couldn’t deduct depreciation if your w2 income was over a certain amount?
But I thought I pay on Roth contributions today? …and not later? opposite of 401k?
Outstanding video! A wealth of knowledge shared in just a few minutes. Thank you!
What are your thoughts about small businesses utilizing life insurance section 162 to save in taxes? Like executive Bonus plans, key man, etc
Can I have HSA account if I have employer-sponsored medical insurance with no premium?
Hi Karton, Cost segregation only can use on short term rental, how do we use depreciation in the long term rental? I thought Passive loss can’t offset high income W2 but I learned now it can’t. So what’s my benefit to own long term rental property besides appreciation. Thanks!
OIL & GAS INVESTMENT IS ONLY FOR ACCREDITED INVESTORS WITH CERTAIN INCOME / NET WORTH. FOR ORDINARY PEOPLE WITH W2, THERE IS NO TAX BENEFIT EVEN IF WE INVEST IN OIL & GAS MUTUAL FUNDS.
Let’s say i make under 40k a year right now, could I still take advantage of your program or is there nothing I can really do ?