I get it, most people think that taxes and even tax tips are boring. But what isn’t boring is the freedom that you will have by saving your money, investing it wisely, and keeping it protected. 

No one likes to be stressed out - it can affect your health, your relationships, and so much more. One of the best ways to avoid stress to reduce the areas of complexity and concern in your life. While I don’t have a tone of tips when it comes to health and relationships, I do have some insights when it comes to investing your money and protecting it. 

On this episode, you’ll hear me break down some simple and easy to understand tips that you can use to protect your money and make the most of retirement. While this is no means a definitive list, I wanted to get you a good start on what you need to succeed - make sure to subscribe to the podcast as I share more insights! 

You will want to hear this episode if you are interested in...

• Tips for reducing your taxable income and more! [1:35]
• Lowering your federal income to avoid taxation [4:30]
• Why it’s helpful to delay drawing from Social Security [7:30] 
• Living in a tax-friendly location [9:00]
• What to do with inherited funds and property [13:00] 
• Key takeaways from this episode [15:45]

How to reduce your taxable income on the federal level

The federal government has rules for different age groups and income levels to make sure that the tax program works across the board. While there are many challenges to taxation at a federal and even at a state level, I found a few tips you can use to reduce your taxable income on the federal level. 

• Keep your income below $40,125 for a single person or below $80,250 for a couple. You can do this by delaying your decision to draw from retirement accounts or investments if needed. 
• Delay drawing from Social Security. My last podcast episode (#4) was all about this topic. 
• Convert part of your 401K or IRA into a ROTH IRA - this will help reduce your future taxable income. 

State income taxes and how to play it smart 

Do you know anyone who vacations to a different part of the country for half of the year? Are there tax benefits to changing your residence to a different state? Thankfully, there are some helpful solutions out there to protect your money when it comes to state income taxes. One relatively easy way to lower your state income tax rate is to move to a state that doesn’t have an income tax. 

Before you move, make sure to check out where that state gets their revenue - just because they have no income tax doesn’t mean they don’t try to get you through property taxes or cost of living increases. If you are looking at this option seriously, I recommend playing it by the book, the IRS considers you a resident of a state if you spend six months and one day in that state. 

I know this topic can seem boring but I hope you found some helpful tips that will save you money in the long run - please let me know if you have any tips you have found helpful, I want to hear from you! 

Resources & People Mentioned

• IRMAA

• Kiplinger’s State by State guide to taxes for retirees

• 14 States that won’t tax your pension

• States without income tax

• Federal tax income brackets

• The SSA’s retirement planner page 

Connect With Morrissey Wealth Management

www.MorrisseyWealthManagement.com/contact