Tuesday, September 17, 2013
The new 20% capital gains tax rate went into effect January 1 with top income earners tacking on another 3.8%. Here are nine strategies to bypass or lessen capital gains taxes:
- Invest in your primary residence to exclude up to $250,000 ($500,000 if married) of gain.
- Manage your tax bracket by keeping your taxable income down.
- Consider harvesting your losses by selling losers in your portfolio.
- Make exclusion gifts to family members up to $14,000.
- Give appreciated stock to charities.
- Feed money into a Roth.
- Open a 529 college savings account for your children when they are young.
- Buy stock and hold onto it for your heirs.
- Move to a state with friendlier taxes.
See Ashlea Ebeling, How to Beat the Big 2013 Capital Gains Tax Hike, Forbes, Sept. 13, 2013.