Money

33 WAYS TO CUT YOUR TAXES

YES, IT’S THAT TIME OF YEAR AGAIN. OUR ANNUAL TAX GUIDE HAS MONEY-SAVING TIPS FOR YOU, NO MATTER WHAT STAGE OF LIFE OR SITUATION YOU FIND YOURSELF IN. BUT DON’T JUST LOOK BACKWARD: SMART MOVES NOW CAN LOWER YOUR TAX BILL FOR 2017 AND BEYOND.

Preparing your 2016 tax return may feel a lot like filing last year’s did, because there are very few changes in the rules. But you’re completing this annual chore against a backdrop of uncertainty, as President Donald Trump and congressional Republicans contemplate a sweeping overhaul of U.S. tax laws.

How to proceed? Keep an eye on the doings in Washington, of course (see page 60 for the most likely changes). But focus first and foremost on what you can do today to trim your tax bill for 2016. “There are still plenty of last-minute moves people can make,” says Lisa Greene-Lewis, a CPA with TurboTax. And get a head start on 2017 planning while you’re at it.

The key is to home in on the special breaks for people in your particular situation—whether you are, say, building a nest egg or paying for college or celebrating a joyous event like a marriage or birth. The 33 moves that follow, organized for people in various circumstances and life stages, will help you keep more money in your pocket and away from your state and Uncle Sam.

YOU HAVE TAXABLE INVESTMENTS

The stock market ended 2016 with a “Trump rally,” pushing the S&P 500 to a 12% gain—in its eighth profitable year in a row. The downside of a long bull market: the sizable capital gains tax you are likely to owe if you or the funds you own sold winners.

FOR YOUR 2016 RETURN

• ENJOY YOUR LEFTOVERS. If you have investment losses from 2015 or earlier that you didn’t use to offset income on previous returns, put them to work now. Those losses can be subtracted from profits on holdings you sold in 2016 without any limit. And if losses exceed 2016 gains, you can subtract up to $3,000 of them from your ordinary income (an $840 savings in the 28% bracket).

• REPORT LESS INCOME TO YOUR STATE. Most states don’t tax your funds’ income from Treasury securities. But if you own diversified taxable-bond funds, you may need to hunt around on fund-company websites for tax documents that list the proportion of Treasury interest. (For instance, in 2016, Vanguard Total Bond Market Index Fund received 30% of income from U.S. debt.) Similarly, you generally

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