A Few Simple Ways to Be Proactive About Reducing Your Taxable Income

Joshua Dobi |

As we enter “tax season,” we begin to receive various questions related to personal and business tax strategies. One question that we hear a lot is, “How can I limit or reduce my taxable exposure?” Unfortunately, there’s not an easy answer.


The first thing to keep in mind is everyone’s situation is different. Every person’s portfolio is diverse, from investments to business interests, so there isn’t one universal answer that applies to all cases. However, there are some general topics you should be thinking about when it comes to financial planning. Here are three considerations:


Tax-Friendly Investments

The first thing you want to consider is what we sometimes refer to as tax-friendly investments. What does that mean? There are many different things you can plug into that category. Most often, we think about things like Municipal Bonds or Individual Securities. Exchange-Traded Funds (ETFs), which distribute very little to you from a dividend or capital gains standpoint, are also a consideration. Real estate is another item to think about as far as being tax-friendly in terms of the overall tax impact on your portfolio.


Managing Your Tax Situation All Year

We talk about a lot at Oakwood Financial Group about managing your tax situation throughout the year. Meaning, is there the possibility you could offset some gains with some losses? Make sure you pay attention to that throughout the year so that if you can reduce some tax impact, you’re in a position to take advantage of it. That will benefit you as far as tax filing for the following year.


Engage a Professional

We’re biased when it comes to this, but we strongly encourage folks to engage with a professional tax advisor. Especially if you desire to manage your tax space in a more comprehensive way. A tax advisor may present some ideas that you weren’t considering before. They can also point you in specific directions for things that weren’t part of the tax code last year or the year before but are now. Consulting with a professional can often provide real value to you when managing your tax exposure.


If you have questions about your financial space, give us a call at (412) 928-8801 or visit us at www.oakwoodfinancialgroup.com. If you wish to schedule an introductory meeting, we would be happy to meet with you at no cost or obligation to you.


These Blogs are provided for informational purposes only and should not be construed as investment advice. Any opinions or forecasts contained herein reflect the subjective judgments and assumptions of the authors only and do not necessarily reflect the views of SagePoint Financial.