It is that time of year again. Time to pay the tax man. At least for most people.
For the past two years we have shared our tax returns (2013, 2014), showing investment income of nearly $100,000 and a Federal Income Tax bill of $0.
This year is a little different because we violated Principle #1, Choose Leisure Over Labor, and this little blog accidentally earned a few bucks. Apparently I’m a business owner now. While that opens up all kinds of interesting tax opportunities, which I certainly capitalized on, having earned income changes the game a bit.
A few months ago the story of a Google employee who lived in a truck(*) in the company’s parking lot went viral. Rather than pay $2,000/month to share a 2 bedroom apartment with 3 other people, he chose to sleep in a 16-foot box truck.
I love it! Great choice! A few years of following the road less traveled will ensure a strong financial future. By not paying rent, an additional $24,000/year can be applied to debt and investments.
But what if there was a way to double that savings with one easy change? And in fact there is. (Hint: taxes.)
Optimizing Obamacare vs Minimizing Taxes presents a classic trade-off.
On the one hand, it would be nice to maximize Obamacare subsidies. Easy! Simply don’t generate a lot of income.
On the other hand, we want to minimize taxes. We do this by offsetting income with standard deductions and personal exemptions, and generating (a large amount of) income that has preferential tax treatment.
But for the ACA, there is no preferential tax treatment. There is no standard deduction, no personal exemptions.
In this post, I explore how to navigate this complex environment in order to optimize health insurance premiums, out of pocket medical expenses, and taxes. Can we find the balance?
Oops, I did it again. Another year of nearly $100k in investment income, but with a very budget friendly income tax bill of $0
The same as last year, income was primarily from index fund and individual stock dividends, interest from a seller-financed mortgage on a property we sold a few years ago, and interest from our cash reserves and a municipal bond fund.
This year’s tax situation was a little more complex, since I violated Rule #1: Choose Leisure over Labor. The blog made a small income, so I learned a thing or two about self employment taxes in the process
Let’s go through our actual 2014 tax return, to see how we kept taxes low this year, and took action to minimize taxes in the future
“What?! The IRS can take nearly 50% of my Retirement Fund in taxes?! How am I supposed to live on only half of my savings? With taxes like this, how can I ever retire, let alone early?”
There is a dangerous nuance in the US Tax Code code that is going to sink and destroy your retirement! There is nothing you can do when the Tax Torpedo strikes, taking nearly half of your income with it!
It is that time of year again. Time to pay the tax man. At least for most people.
