HOW TO REDUCE TAXES FOR HIGH-INCOME EARNERS

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Are you interested in learning how to reduce taxes as a high-income earner? Some individuals pay an income tax rate at or above 50%, depending on specific state and local taxes.

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The unfortunate, but realistic truth, is that ultra-rich and well-informed individuals often pay lower effective tax rates than people making substantially less income. So let’s level the playing field and work toward equality. In this article, I will outline several key tax strategies I use and will educate you on making tax-smart moves like the top 1% do.

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There are several tax-reducing strategies for high-income and mid-income earners that many financial advisors or CPAs may or may not bother to discuss with you. Some tactics are beyond their expertise, and others won’t earn them any additional money, so it’s not in their financial interest to overcomplicate their roles.

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Tax Basics and Legislation

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The SECURE Act was implemented in 2019 and significantly overhauled tax implications on individuals. The most notable updates for most individuals to be aware of include the following:

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– The age for Requirement Minimum Distributions (RMDs) was raised to 72 from 70½. This delays when individuals must start withdrawing funds from their traditional retirement accounts and pay ordinary tax on the proceeds.

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– The age limit was removed for Traditional IRA contributions. Individuals can now still contribute to a retirement account if they continue working past 72. Therefore it is possible to contribute and withdraw RMDs from a retirement account within the same year.

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Swipe Up For The Rest of the Article

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