When enjoying burgers at your neighbor’s BBQ this weekend it’s even money you’ll hear somebody talk about tax shelter. Happens to me all the time. They’ll rhapsodize about how cool it is to see their tax bill melt away due to their investment home’s depreciation. Little do they know they’re missin’ the boat on the best way to benefit from that level of tax savings. It’s all in the application.
You have two choices — get a large tax refund each year — OR, get it in every paycheck during the year. What? You can do that? Yes, you surely can.
Here’s how.
Go to the powers that be at work, after you’ve spoken with your tax accountant. He’ll have told you the magic number you’ll need to know. Magic number? It’s the number of exemptions you’re gonna tell your boss you claim on your W-4 form. The accountant will look at your newly acquired depreciation, and let you know how many exemptions make sense.
The bottom line results will show up in both your periodic paychecks, and your tax return for the year. Your ‘take home pay’ will increase, a good thing. Your tax refund will correspondingly shrink. What you’re doing, in a nutshell, is ceasing to loan Uncle Sam YOUR money every year at 0% interest. Instead, you’re allowing yourself the use of that money for every day living.
It’s one of the rare times in life when we can have our cake and eat it too.
Let’s talk about your retirement. Where are the best places to invest? I can tell ya. 619 889-7100. Have a good one.
