Thinking “Outside-the-box” in Tax Season

When I was twelve years old, my Uncle Frank and two of my cousins came to visit the family for the holidays. While the adults were doing their adult thing, and it was too cold to play outside, the boys started a board game of Conquest of the Empire.

My cousin Jeff always seemed to have the upper hand. Even though I was confident we could beat him this time, the game ended up being no different than the last one, with my brother Pete and me on the ropes of defeat within a few turns.

As luck would have it, Mom told the boys to move the game out of the living room. She would be hosting time for the grown-ups to enjoy cocktails and engage in adult conversation. Jeff offered to carefully move the game, since he was interested in seeing it through to the final turn.

In the doldrums of despair, and hoping I could somehow salvage my board game reputation, I thought frantically for a solution. Finally, Uncle Frank took my brother and me under his arms and gave us some long-awaited guidance. Uncle Frank was known for his “outside-the-box” thinking, and this time would prove no different. With his calm demeanor he asked us “Pat and Pete, do you want to know how to beat Jeff at this game?” With baited breath we exclaimed “Yes, Uncle Frank… Please tell us!”

He gave us a simple, two word sentence.

“Trip him.”

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Outside-the-box thinking can be the most valuable when it comes to personal finances.

Tax season is upon us, and if you’re like 99% of others, you probably haven’t done any strategizing last year to save on taxes. At some point in the next few weeks, you’ll gather your W-2s and 1099s and start punching numbers into software so you can get your refund.

Tax savings are some of the best savings to find. It’s money you’ve already earned, so you don’t have to work longer hours to increase your income. These savings may require some outside-the-box thinking, but if you educate yourself on some strategies, they can be very beneficial.

One way to save money right now, is to contribute more to your traditional 401(K) retirement account (or Thrift Savings Plan for active-duty military and government civil servants).

You can contribute up to $19,000 to your retirement account for 2019, and you can make those contributions until April 15th of this year. If you’re over 50 years old, you can contribute an additional $6,000. This tax reduction takes place before your deduction process. So it doesn’t matter if you take the standard deduction or itemized deductions. You get the tax savings either way.

However, there’s even more benefits.

If you use this last minute strategy to reduce your taxable income, these contributions could help you save on investment taxes, too. It’s a ripple effect that many tax-payers aren’t aware of. If you’re single and you can get your taxable income under $39,000, or if you’re married filing jointly and you can get your taxable income under $78,000, you’ll get some of your other investment profits and dividends tax-free.

Imagine getting an additional $500 in tax savings by using a simple strategy like this one. I talk about this in my book Tax Saving Strategies.

My book is loaded with great tactics for saving on taxes, and it’s entirely risk-free. I encourage you to get a copy right now.

You can get a copy for under $10, and if you aren’t totally blown away by the value, return it and Amazon will give you a full refund. Furthermore, if you order a digital copy within the next 5 days, you’ll be able to get it for even less.

Take action now. I want to get you to your financial goals for 2020, and one key element is saving on taxes. Pick up a copy of Tax Saving Strategies today.

Have a great weekend, and until next time, I wish you unlimited success!

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