| The countdown from Thanksgiving to Christmas is a | | | | 6. Charitable Contributions - Do you love that warm, |
| magical time of year, but it's also a warning to real | | | | fuzzy feeling you get inside when you spread around |
| estate investors that December 31 - the end of the | | | | some of your hard earned cash - and it's not being |
| tax year - is almost upon us. If you haven't yet gotten | | | | caught by a Washington politician? If that's the case, |
| your financial house in order you're running out of time | | | | give to your heart's content, while enjoying a sizable |
| to gather your records and do some last-minute | | | | IRS tax deduction. |
| planning to minimize your tax burden. The good news | | | | 7. 1031 Exchange - This money-saving tip can save |
| is, if you start now, you still have time to save yourself | | | | you tens of thousands of tax dollars over the course |
| some money on the tax bill you're going to have to | | | | of your real estate investing career. When you sell a |
| pay in April. Here are 10 great money-saving tax tips | | | | property for a profit you would normally get hit with a |
| that will put a warm smile on your face regardless of | | | | substantial capital gains tax. This technique allows you |
| the temperature outside. | | | | to defer your tax penalty indefinitely - until death if you |
| 1. Home Office Deduction - If you're new to real estate | | | | like. Use the 1031 exchange to defer taxes you'd |
| investing, you may not be aware of this timeless | | | | otherwise have to pay. While it's true that "you can't |
| treasure that the IRS makes available to you. By | | | | take it with you", why should you take the taxes with |
| setting up a dedicated workspace in your home, you | | | | you? |
| can deduct much of the costs of doing business if you | | | | 8. Charrissa's Mortgage Secret - This technique |
| work out of your home. In addition, you can | | | | seems devious, but it's an entirely legal way to reduce |
| proportionally write off some of your living expenses, | | | | your tax liability. Your mortgage payments are |
| such as mortgage interest, utilities, and telephone | | | | probably due on the 1st of the month. By paying them |
| expenses. | | | | a day early, not only can you save a day's interest, but |
| 2. Mileage Deduction - Sky-high gas prices will really | | | | you gain the benefit of being able to deduct an extra |
| save you money at tax time. You'll be able to get | | | | month of mortgage interest. How much can you save |
| some of these expenses back, but the standard rate | | | | with this technique? How many properties do you |
| will vary, depending upon when you were driving for | | | | have? |
| business. For the half of the year ending June 30, the | | | | 9. Charrissa's Stalling Technique - If you're planning on |
| deduction is 50.5 cents per mile. Starting July 1 and | | | | selling a property in December you can save your |
| going to the end of the year, that rate increased to | | | | capital gains liability by delaying the closing until the new |
| 58.5 cents per mile. | | | | year. While not as beneficial as the 1031 Exchange, it |
| 3. Educational Expenses - Did you decide you just had | | | | still allows you to delay paying the tax for a full year. |
| to pick up that investing course, book, or CD set that | | | | 10. Early Payment Discount - Will you owe state and |
| claimed it would put you on Easy Street in no time? | | | | local taxes this year? You have two choices: Pay |
| Good news. It's deductible as long as your purchase | | | | them in January and wait a full year to take your |
| was designed to expand your business opportunities. | | | | deduction - or pay them in December and deduct |
| 4. 401K Conversion - Did you finally decide it was time | | | | them next April. |
| to fly solo? If you quit your job this year, you can | | | | You may be wondering what to do with some of your |
| convert that 401K plan that's getting beat up by Wall | | | | tax savings. That's really your call. You can use it for |
| Street into a self-directed IRA. Not only will it save you | | | | investing in another red-hot property or you might put it |
| money, it will also free up valuable dollars you can use | | | | to good use as an extra nice Christmas gift for that |
| to invest in even more real estate - all with Uncle | | | | special someone in your life, or you might even opt to |
| Sam's blessing. | | | | perform a random act of kindness for someone less |
| 5. Self-employed Health Insurance - One of the biggest | | | | fortunate than you. If you play your cards right, you |
| challenges faced by self-employed real estate | | | | might be able to do all three. |
| investors is how to pay for health insurance once you | | | | Whatever you decide, enjoy doing it. Smile knowing |
| leave the relatively safe ranks of the employed. This | | | | that the money you're spreading around is being |
| deduction can save you a bundle because insurance | | | | spread by you - and not being squandered by your |
| premiums are very high. | | | | Uncle Sam. |