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Fortunately, there are solidtax-lowering strategies that dont involve shady accountants or suspect Caribbean banks.
But they steal a crucial tax strategy of the wealthy: tax-loss harvesting.
For example, lets say a direct indexing account was able to harvest tax losses of $100,000.
Thats a significant tax savings, explained DiLiberto.
He added that investors need to do due diligence when choosing a firm, since strategies and fees vary.
Tax-Smart Bond Strategies
Bonds have always been a go-to investment for those nearing retirement.
They offer a guaranteed return without the volatility and potential downside of the stock market.
So, for older investors who cant ride out market downturns and want guaranteed income, bonds are attractive.
But gains are often reduced significantly by taxes.
They are fixed-income securities, so they offer a reliable return, but they are exempt from federal taxation.
In some cases, they are also exempt from state and local taxes.
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