KEY POINTS

• Selling assets strategically could get you off the hook for capital gains taxes.
• Funding a retirement plan could shield some income from the IRS.
• Claiming the right deductions could lower your tax burden.

Check out our picks for best tax software

Most of us would probably agree that taxes are a drag. And the bad news is that it's pretty difficult to get out of paying taxes completely. It's technically possible to do so if you're a low enough earner, but then, well, you're living on very little. So that's not ideal.

But while you may not be able to get away with paying the IRS $0 year after year, you should know that there are plenty of actions you can take to set yourself up to pay less tax. And the best part? They're completely legal. Here are some IRS-approved tricks that could save you a bundle.

1. Holding investments for a year and a day before selling them

When you sell investments in your brokerage account at a profit, you're required to pay taxes on your gains. But in some cases, you may not have to.

Read more: we researched free tax software and put together a list of the best options here

Capital gains are grouped into two categories: short term and long term. The former applies to assets held for a year or less before being sold, while the latter applies to assets held for at least a full year and one day.

If you hold assets long enough to qualify for long-term capital gains, you can lower your tax burden on those gains. And if your income is low...

Read Full Story: https://news.google.com/rss/articles/CBMiYmh0dHBzOi8vd3d3LmZvb2wuY29tL3RoZS1h...