The new tax law nearly doubles the standard deduction which means even fewer folks will be itemizing deductions on their tax returns this year- however, there is still an important way to massively cut our tax bills! Regardless of whether we take the standard deduction or if we itemize deductions- we can still reduce our tax bill by ‘above the line deductions’. These are technically not actual deductions but adjustments to arrive at our adjusted gross income which we typically want as low as possible in order to pay fewer taxes! Listen as we cover some of the best ways to cut our tax bills and why you’ll likely want to do the same.
During this episode we enjoyed a Karate in the Garage by Southern Swells which you can find and learn all about on Untappd. A massive thanks to Kate from Southern Swells for sending us a bunch of their beers- we’re big fans of what they’re doing down at Jax beach! And if you enjoyed this episode, be sure to subscribe and give us a quick review in Apple Podcasts, Castbox, or wherever you get your podcasts- we’d love to hear from you.
Best friends out!
Hi guys,
Just discovered your podcast in late 2017 and I loved the most recent ep about reducing your tax bill. Great info! One thing I wanted to bring to your attention was the the bicycle commuter benefit has been suspended.
Tax Reform eliminated the bicycle benefit through 2025, which is a bummer for people who bike to work. This information can be confirmed in IRS Pub 15-B, “Employer’s Guide to Fringe Benefits.”
The upside is that the commuter benefit (IRS tax code 132f) allows employers to offer up to $265/mo tax free to pay for transit passes, vanpool expenses (even Lyft Line and uberPOOL) and monthly parking subscriptions.
Thanks for making personal finance less frightening!
Cheers.
So you dropped that nugget about the interest rate but you left out an important part! Which CU???
Hey Mark, that’d be Associated Credit Union! http://acuonline.org
Thanks Matt! I found your podcast a couple of weeks ago and I am really enjoying the content. It is also cool that you talk about the local area. Being in the Atlanta area I find your information valuable. Keep it up!
Hey guys. I’m new but am loving your podcast! Just FYI alimony is no longer deductible as of 2019. Lame; I know.
Great podcast guys. I’d love to see a podcast about investing in a solo 401k, as more and more side hustlers can potentially fall into this category these days. And Joel, Matt was right, Honey Bunches of Oats really is the best cereal. #honeybunchesforlife
Just a quick correction. The SEP IRA has a bit more nuanced limit. $56,000 is the top end limit, but technically:
The contributions you make to each employee’s SEP-IRA each year cannot exceed the lesser of:
25% of compensation, or
$56,000 for 2019 ($55,000 for 2018 and subject to annual cost-of-living adjustments for later years).
source: https://www.irs.gov/retirement-plans/retirement-plans-faqs-regarding-seps-contributions
You may want to make a correction (if you haven’t already) and hopefully listeners researched the SEP before contributing, as there would be penalties for going over the 25% of compensation.