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Some tax credits are refundable even if you dont owe taxes, the government actually pays you money.
Even higher-income households can find tax credits, although it requires more strategy.
Contribute the maximum amount to qualified retirement plans during higher-earning years, he advised.
it’s possible for you to also contribute to ahealth savings accounttax-free to slash your tax bill even further.
Taxes are lower than they have been in decades, he noted.
Especially in lower-income years, move money from traditional accounts to Roth accounts.
You cant deduct the contribution but you’re free to roll it over to your Roth account.
Eid pointed to tax benefits baked into passive real estate investments likesyndications and equity funds.
Depreciation allows property investors to deduct the cost of the buildings over several years, he said.
Investors also benefit from cost segregation, which accelerates this process.
Because real estate is inherently an illiquid investment, most investors hold it long-term.
Thus, they pay the lower long-term capital gains tax rate on profits.
However, they may not even have to pay that.
The options dont end there, either.
Vince DeCrow, founder ofRISE Investments, likes Qualified Opportunity Zone funds.
Longer-term investments can appreciate tax-free through the end of 2047.
These funds offer tax advantages similar to Roth IRAs.
The better you plan out your giving, the better your tax benefits.
Dont sell stock to give cash to charity, advised Powell.
Instead, transfer the appreciated stock to a Donor Advised Fund and then sell the appreciated stock to donate.
This way you avoid the capital gains tax.
This can qualify you for many business-related deductions without having to itemize your personal deductions, explained Luscombe.
you could even deduct part of your home expenses if you have a qualifying home office.
That goes beyond your rent or mortgage payment.
you could also potentially deduct your home internet, phone, utilities and other expenses.
Meanwhile, residents of West Virginia pay an average of $358,407.
You dont necessarily need to stick around and pay high federal taxes either.
Having lived abroad for a decade, Ive personally paid little in taxes.
The foreign earned income exclusion, for instance, makes my first $130,000 in income in 2025 tax-free.
You cant avoid taxes entirely but you’re free to reduce them.
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