2022 was our first full year back in the United States, which means we were fully in the crosshairs of the 3 US tax systems: Federal, State, and ACA.
One might think this would result in a large tax burden. But no.
Although the incentives have certainly changed.
The end of the calendar year is quickly approaching, and that means it is time to run through our year-end tax checklist. The simpler the better.
Here are a few important items to review and actions to take.
Markets are down. Robo-advisors and savvy investors are tax-loss harvesting.
But me? I had no intention of doing so.
Thankfully, two Go Curry Cracker readers correctly pointed out I was wrong to not tax-loss harvest.
Yes, I absolutely am tax-loss harvesting and loving it. (Thanks!)
After a decade of zero and near zero tax bills, our 2021 tax return looks a bit different – We paid a LOT of tax.
No surprises though – I sold a ton of stock to pay cash for a house. In the grande scheme of things it is no big deal.
I’ll break it all down below (with links) and highlight some things I did to minimize taxes this year and going forward.
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Every year during this time, we reconcile our earnings and deductions for Uncle Sam and either fork over more dough or humbly request that a little be given back. If you follow the strategies of this blog you may not have much tax liability to begin with, but if you find yourself in a position where you owe the IRS and were wondering if you could earn rewards points on that payment, the answer is yes. More significantly, there’s an interesting trick where you can potentially earn hundreds of thousands of points and miles by making estimated payments which is discussed below.
(GCC: I am often asked, “Do you know any good CPAs?” and “What are some good tools for doing my taxes?” I never thought both questions could share a common answer – Kathryn from Making Your Money Matter is a CPA (who gets it) who has developed some very cool tools for doing taxes (and more) that cost less than an hour with a CPA. Disclaimer: links in this post are affiliate links.)
I remember the first time I found Go Curry Cracker and read one of Jeremy’s blog posts going through his tax return in detail. It covered his then-recently filed 2015 tax return, with over six figures of income and still no income tax due (only a small amount of self-employment taxes).
I’d like to say that I—a CPA—was intuitively able to do a quick review of the numbers and figure out pretty fast how this worked out. However, I had to pull out a pen and paper and calculate it by hand just to make sure it made sense.
Each spring since, I’ve looked forward to the annual tax return reveal. (GCC: 2021 tax return coming soon!)
If you have ever wondered, How can I optimize my taxes in the same way… without all the hassle of becoming a tax nerd first, well… have I got a tool for you.
