How to save on taxes?

Re: How to save on taxes?

you can invest in government fund. fix deposits and Provident fund then you will save your tax. also you will invest in insurance then you will save your taxes.

Re: How to save on taxes?

Speak to a business tax advisor for free at corporatetaxnetwork.com. They'll teach you about the deductions you qualify for.

Re: How to save on taxes?

Donate stock to charities: Instead of writing a check, donate to charity stocks that have appreciated a lot since you bought them. You will be able to deduct the entire market value of the stock for tax purposes. The charitable organization will be able to cash it without paying as much taxes as you would have. Everyone wins.

Re: How to save on taxes?

Hello

"How to save taxes" is one of the biggest concern for any salaried person in India. You can see people asking others and tax consultants to give them advices on tax saving. So here are few advices and tips on tax saving in India.

Under section 80C, you can save tax by investing up to rupees 1,00,000 (One lakh) in various tax saving bonds and buying insurance. But there are more options available to you than just section 80C, like.

* You can invest up to Rs. 70000 per annum in PPF, where the interest is tax-free. However, you could invest up to max Rs. 1 Lakh with additional PPF investment in the name of any other dependent family member like your wife or children and you can claim the deduction.
* You can buy a Mediclaim policy of premium 15000 per annum. This way you will have tax benefit as well as you will have good money incase of any health issues.
* Buy LIC or other life insurance policies that will give you some tax benefits. Maximum limit for LIC premiums are up to Rs. 1 Lakh. Premium paid in any year should not exceed 20% of the sum incurred. Also please note that the sum paid in excess of 20% will not be allowed for any deductions.
* You can show some of expenses as House rent, Even if you are not paying directly, but for the shake of saving some tax, you can show it as if you are staying in your family home but you pay rent to your father/mother.
* Invest in ULIP (unit linked policy). Minimum Limit - Rs. 15,000 with annual contribution of Rs. 1,000 and Maximum Limit - Rs. 2 lakh with annual contribution of Rs. 20,000. You will get exemption from wealth tax.

Thanks for all friends

Re: How to save on taxes?

There are several ways taxes can be saved either through a strategy, or tax savings tactics, or both. Tax strategy involves a long term tax saving plan such as annual contributions to either tax exempt or tax deferred retirement savings vehicles such as Individual Retirement Accounts (IRA's) and life insurance policies with retirement annuities built in.

In the short run, other tax methods that are commonly used are deductions in excess of one's qualifying standard deduction. In other words, if a tax filer can itemize deduction on Schedule A that are higher than the standard deduction, it has more tax savings than using the standard deduction. Items that are deductible on IRS Schedule A include mortgage interest paid, paid taxes, job expenses, charitable donations and miscellaneous expenses

Re: How to save on taxes?

1. Auto Expenses

If you use your car for business, or your business owns its own vehicle, you can deduct some of the costs of keeping it on the road. Mastering the rules of car expense deductions can be tricky, but well worth your while.

There are two methods of claiming expenses:

* Actual expense method. You keep track of and deduct all of your actual business-related expenses.
* Standard mileage rate method. You deduct a certain amount (the standard mileage rate) for each mile driven, plus all business-related tolls and parking fees. In 2010, the standard mileage rate is 50 cents per business mile driven, a decrease from the 55 cents per mile rate in effect for 2009.

As a rule, if you use a newer car primarily for business, the actual expense method provides a larger deduction at tax time. If you use the actual expense method, you can also deduct depreciation on the vehicle. To qualify for the standard mileage rate, you must use it the first year you use a car for your business activity. Moreover, you can't use the standard mileage rate if you have claimed accelerated depreciation deductions in prior years, or have taken a Section 179 deduction for the vehicle. (For more on Section 179, see "New Equipment," below.)

If your auto is used for both business and pleasure, only the business portion produces a tax deduction. That means you must keep track of how often you use the vehicle for business and add it all up at the end of the year. Certainly, if you own just one car or truck, no IRS auditor will let you get away with claiming that 100% of its use is related to your business.

Re: How to save on taxes?

The best thing that you can do is invest in government's tax saving scheme's and try to take the loan from government authorised bank. Other way is to invest in LIC insurance policy with safe & guaranteed and tax free return & also get any loan then you will get tax benefit.

Re: How to save on taxes?

we spoke about the Public Provident Fund and Equity Linked Saving Schemes being good investment options.

Over here, we discuss home loans and insurance, both of which have tax implications.
A Mediclaim policy is a must because should you fall sick or meet with an accident, your medical bills could wipe out your savings.

As in term insurance, the premium rates will vary among the insurers and will also depend on your age. The older you are, the more hefty the premium.

Re: How to save on taxes?

The only reason I have it at the bank is that this arrangement qualifies me for some preferential treatment, like different teller lines and a discount on a safe deposit box. I do my active investing (mostly index funds) elsewhere

Re: How to save on taxes?

A final possible benefit: As compared to regular corporations, S corporations sometimes save owners taxes because S corporations don’t pay corporate income taxes. (This means that S corporations avoid the often-talked about “double-taxation” problem.) But the “no corporate income taxes” benefit often isn’t a savings for small corporations and their owners.

Suppose that two corporations each earn the same pretax profit of $100,000 and are owned by Devlin who pays the highest federal income tax rate of 35%. One corporation is an S corporation and the other is a C corporation. S corporation can distribute the entire $100,000 in profits to Devlin as dividends because there is no corporate income tax. Devlin then pays $35,000 in personal income taxes on the S corporation profits, which means she nets $65,000 in after-tax profits from S corporation. In comparison, C corporation can’t pay the entire $100,000 in profits to Devlin. C corporation first pays $22,250 in corporate income taxes. When C corporation pays the remaining $77,750 to Devlin as a dividend, Devlin pays another $11,663 in 15% “dividend” taxes on the C corporation. This means that Devlin nets roughly $66,000 in after-tax profits from C corporation. In this case, Devlin saves money with a C corporation in spite of having to pay the corporate income tax.

Re: How to save on taxes?

The only reason I have it at the bank is that this arrangement qualifies me for some preferential treatment, like different teller lines and a discount on a safe deposit box. I do my active investing (mostly index funds) elsewhere.

The customer service man was calling to confirm some inconsequential account data and I surprised him by asking, “What will you give me for that bond?”

While waiting for him to call back I took a peek at the Bloomberg terminal in the hallway. The bond's price was oscillating between 103-29/64 and 103-15/16. Taking the midpoint, I figured the bond's fair value to be $103,460.

The banker called back and offered to pay me 103-1/8 (plus accrued interest). Not worth it, I said. Can you do a little better?

Re: How to save on taxes?

There are several ways to save taxes in any given year.Lowering taxes can be achieved in every income bracket level with the right tax savings awareness and strategy.

Re: How to save on taxes?

Nobody likes paying taxes, but they are a necessary evil.

Re: How to save on taxes?

Always make sure to file your tax on time to avoid penalties and other surcharges. Keep all your receipts even those with small amounts because they can be used to decrease your income hence; lower your expenses.

Re: How to save on taxes?

1.Clean out your closets and make a charitable donation to Goodwill, The Salvation Army or another charitable organization. Just make sure you get a receipt. Charitable donations, be they cash, goods or services, are deductible.

2.Participate in your employer-sponsored flexible spending plan. If you pay child care expenses or have out-of-pocket medical expenses for co-pays, over-the-counter medicines or medical equipment and other such items, you can submit your receipts to a dependent care or medical care flexible spending account to get reimbursed with pre-tax contributions that your employer deducts from your paycheck. The money comes out of your gross pay before taxes are deducted, which reduces the overall amount that gets taxed. That means you save money on your federal income taxes.