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SMART MONEY STRATEGIES FOR EVERY AGE AND SITUATION
Your 40s and 50s—The Peak Earning Years of Middle Age

Section 11 of 11:
TAXES:
How Do I Pay The Least Amount?
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Taxes are probably the most unpleasant aspect of personal finance.
However, just because you do not like thinking about how much
you must pay in federal, state, and local taxes every year does not
mean that you should avoid the subject.

If you pay little or no attention to the tax consequences of every
financial move you make, you will certainly owe the government
more money, not less. On the other hand, if you learn the basic
tax-saving strategies, you can maximize the amount of money you
spend and invest while you minimize your tax bite.

Combined with the tips, techniques and action strategies included
in the other sections of this report, you can learn how to micro-
manage your funds so that your money multiplies itself.

Read on and reap the financial rewards!

Jordan E. Goodman
America’s Money Answers Man
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TAXES:
How Do I Pay the Least Amount?

As you enter your peak earning years, your tax obligations will
probably rise. It is therefore more important than ever to maximize
all the legal tax reduction strategies possible. For example, if your
company offers a salary reduction plan and a flexible spending
account (FSA) for medical and dependent care expenses, take full
advantage of them. If you are not eligible for a pension, contribute
to a deductible individual retirement account (IRA).

If you are self-employed, fund a Keogh account with as much
money as you can afford. Invest in tax-sheltered vehicles such as
municipal bonds and municipal bond funds, annuities, and life
insurance. If your calculations show that it is advantageous, buy a
home and use the mortgage to generate interest deductions.

If you already own a home and have built up a substantial amount
of equity, convert your nondeductible consumer loans to deductible
home-equity debt. Remember that if you sell your principal
residence in which you have lived for at least two of the past five
years, you will not have to pay capital gains tax as long as your
profit is less than $500,000 for a married couple filing jointly or
$250,000 for a single.

If you want to downsize to a smaller home or apartment, you are
under no obligation to reinvest the proceeds. You may want
to rent and invest the proceeds of your home sale in income-
producing stocks, bonds, and mutual funds. Maximize deductions
by bunching them in one year. And, finally, set up trusts to pass on
your assets to your children with a minimal amount of estate taxes.

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RESOURCE | RESOURCE | RESOURCE
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You work hard for your money.
But do you maximize the money you earn?

Everyone’s Money Book shows you how to proceed confidently into
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Jordan Goodman covers all of the options available for managing
your money wisely in friendly, easy-to-understand language.

Packed with worksheets, step-by-step instructions, charts, graphs,
application forms, quizzes, and more than 6,000 resources to help
you turn concepts into actions, Everyone’s Money Book is the most
comprehensive, accessible, and easy-to-use book available.

Over 200,000 copies sold.

Order Everyone’s Money Book (970 pages) today for only $30.
www.moneyanswers.com/bookstore/

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ACTION STEP | ACTION STEP | ACTION STEP
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Payoff All of your Debts
in 5-7 Years using the
money you ALREADY make!
DebtIntoWealth