Does Uncle Sam put you in the category of top earners in the United States? If so, chances are you will pay more than the majority of Americans when it comes to taxes this year. Here are few tax saving tips for you.
Home Owners Save
If you have extra money, consider purchasing a home. When filing your taxes make sure to itemize costs on IRS Form 1040 Schedule A(opens as PDF) to claim the deduction. Additionally, you are able to deduct the interest paid on a second home.
Find a Worthy Charity
If you decide to make give a charitable donation, you will receive a tax break, it is that simple. Make sure to itemize each donation on IRS Form 1040 Schedule A to claim the charitable deduction.
Pay Back Taxes Owed to the IRS
If the Internal Revenue Service (IRS) is after you because you owe money in back taxes, it is best to seek the advice of a tax professional.
Regardless of your current IRS tax issues, companies like U.S. Tax Shield have answers for your particular circumstances. Our tax tips will protect you from the IRS, guard your assets, and eliminate stress, while potentially saving you thousands of dollars.
Long-Term Capital Gains
Capital gains are taxed 15% on investments like stocks, bonds or mutual funds that are held for more than 12 months. This tax percentage is much lower than top income tax rates on wages that cap off at 35%. Some estimate that the capital gains rate saved wealthy Americans close to $40 billion in 2012.
Step-Up in Basis
If you are in America’s top income bracket, you have most likely heard of step-up in basis. It is estimated there are $40 billion in tax breaks annually due to the 15% capital gains rate, but heirs will receive the best tax savings due to the “step-up in basis rule.”
What are the details? Ultimately, the “step-up in basis rule” permits the wealthy to pass along assets that have grown in value to their heirs without ever paying taxes on the sum.
Due to the inheritance rules of IRS, if you inherit assets like stocks, real estate or even certain businesses, you are allowed to step up their basis – the amount the deceased initially paid for them – to what their current value would be in a fair market. Consequently, when you sell inherited assets, you would only be taxed only on their gain in value from the time you inherited them. This means major savings for all heirs.
Questions? Find the answers with U.S. Tax Shield
If you have questions about taxes, or you are one of the many Americans who owe back taxes to the IRS, contact a certified tax resolution attorney today. The professionals at U.S. Tax Shield are here to help you save time, stress and money.