Money Guy Show Don't Fall For These 5 Tax Traps!
Feb 21, 2025
Discover the five tax traps that could be draining your wallet, from mistaking refunds for windfalls to mismanaging retirement contributions. Learn how minor adjustments in tax withholdings can boost your cash flow and enhance financial growth. Gain insights into the importance of early contributions to retirement accounts and the power of compound interest. Plus, understand the fine line between legal tax avoidance and illegal evasion to empower your financial decision-making. Avoid common pitfalls and learn to make the tax code work for you!
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Don't Blow Your Refund
- Avoid blowing your tax refund on unnecessary purchases.
- Instead, invest it for long-term growth or use it to pay down debt.
Avoid Underpayment Penalties
- Understand estimated tax payments to avoid penalties.
- Pay 100% of last year's taxes or 90% of the current year's liability.
Income Cliffs
- Be aware of income cliffs in the tax code.
- Crossing these thresholds can impact your tax liability and eligibility for credits.