The IRS just released audit data for FY24.

They closed 505,514 audits.

Here's who they're targeting (and how to stay off their radar): For FY 2024, the IRS closed 444,014 audits of individual tax returns.

Do you know who gets audited the most?

People who make between $1 and $24,999 in positive income.

Bob made a $430,000 tax mistake.

He gifted his house to his son before he passed away.

If he had waited, his son could've owed $0 to the IRS.

Here's how the step-up in basis works: Bob gifted a $2,000,000 California house that he purchased for $50,000 back in 1970 to his son.

The son decided to sell the house and paid ~$430,000 of federal taxes.

This is because the son received a "carryover basis" for the house, and had to pay capital gains.

HSA wealth hack:

Don't pay medical expenses with an HSA card. Use a credit card and reimburse yourself 10-15 years later to benefit from untaxed growth in your HSA.

But 99% of people don't know how to execute this properly. Let me explain 🧵 If you're unfamiliar, HSA provides a triple tax benefit:

- tax deduction
- tax free growth
- tax free withdrawal for medical purposes

It's also exempt from FICA if contributed through employer payroll deductions.

32 pieces of tax strategies I could come up with:

1. Married couples can withdraw $126,700 from investments and pay $0 in federal taxes in 2025 if no other income. 2. Tax refund is not free money. You just overpaid your taxes to the IRS and got a 0% interest yield from it

3. The tax code favors business owners due to flexibility. You get many deductions you wouldn't get as a W-2 employee

65% of U.S. households own their homes, but most have no clue how homeownership taxes actually work.

If you own a home (or plan to), here are the tax rules that could save you thousands: 1. Mortgage Interest

If you have a mortgage, you can deduct the interest you pay on loans up to $750,000 (or up to $1M if the loan was taken before December 16, 2017).

But this deduction is only available if you itemize your deductions on Schedule A.

When you sell stocks or ETFs at a gain, you have to pay capital gains tax.

But there are 9 effective strategies to lower or even eliminate what you owe to the IRS.

Here's how: 1. Holding period

If you hold assets (stocks, ETFs, real estate, etc) for more than 365 days after acquisition, you qualify for long-term capital gains treatment.

This reduces the tax rate from a maximum of 37% (ordinary income rate) to a maximum of 20%.

Every piece of investing advice I could come up with since I started investing at 18 (bookmark this):

1. Most people shouldn't buy individual stocks. Stick to index funds/ETFs 2. If hedge funds can't beat the market by trading individual stocks, what makes you think that you can?

3. Use broad market, low-cost index funds/ETFs to invest

4. Start investing as early as possible. Let time do the heavy lifting

Instead of investing in an S&P 500 index fund, you could own 500 companies individually to harvest losses.

This strategy is called "direct indexing" and it can generate a ~1% tax alpha.

Here's an in-depth thread on how it works: Direct indexing is a process of buying individual stocks that track an index fund, instead of buying index funds directly.

In return, you can tax-loss harvest significantly more.

(p.s. make sure to bookmark the post above for reference!)

Yesterday, the House released a 389-page tax bill that includes trillions in tax cuts.

I read every single page so you don’t have to.

Here’s everything you need to know:

🧵 The Ways and Means Committee is expected to vote on this today.

Lawmakers could change it there, and also before the plan hits the chamber floor.

But the majority of these changes will go through.

Let’s dive in...

🚨 The House Ways and Means Committee on Friday night released a partial version of the new tax bill.

I reviewed it all and the changes are significant.

Here’s everything you need to know: The Ways and Means Committee released a 28-page proposal on some of the tax changes.

These changes would be the basis of the tax changes, and more tax changes will very likely be added to the finalized version.

Let’s dive in..

Does Pope Leo XIV owe taxes to the IRS?

It's pretty complicated...

Here's how U.S. tax law applies even inside the Vatican walls: The new Pope Leo XIV reportedly holds dual citizenship in the US and Peru.

From a tax standpoint, the US taxes its citizens on worldwide income no matter where you live.

But it gets complicated...

Many say "Donald Trump gave tax cuts only to the billionaires!"

I reviewed actual IRS data for 153.77 MILLION tax returns to understand if that's true.

Here's what it showed: Trump signed "The Tax Cuts and Jobs Act" back in 2017 and it went into effect in 2018.

So, I pulled the data for 2017 and 2018 to compare the year over year change and understand the impact.

(make sure you bookmark the post above for reference)

If you are a high earner, stop using high yield savings accounts for your savings.

You pay federal, state, local, and net investment income tax on your interest.

Here are smarter, more tax-efficient options: Say you live in New York City and are a high earner ($1M/year). You’ll pay:

- 37% marginal federal rate
- 3.8% NIIT
- 6.85% NY state tax rate
- 3.876% NYC local tax rate

Many billionaires avoid taxes using a 3 step strategy: Buy. Borrow. Die.

It's so effective it sounds illegal (but isn’t)

Here’s how the $2,500/hr wealth lawyers structure it: You might've heard of a strategy where the wealthy borrow against their stocks and use loans to live off and avoid taxes.

But it's way too simplified, and doesn't take wealth taxes into consideration...

(p.s. bookmark the post above for reference)

I'm SHOCKED that many high earners still don't use the Backdoor Roth loophole.

It lets you contribute to Roth IRA DESPITE being over the income limit.

Here's exactly how to do it:

(bookmark for reference) Roth IRA has income limits.

If your adjusted gross income is above $165,000 (single) or $246,000 (married jointly) in 2025, you can't contribute to Roth IRA directly.

Luckily, there is a strategy...

President Trump just said "When Tariffs cut in, many people’s Income Taxes will be substantially reduced, maybe even completely eliminated"

I reviewed IRS data to see if it's possible.

Here's all you need to know: According to IRS data for the 2023 tax year, they collected about $2.1 trillion in net income taxes:

A retired individual has $1M in a brokerage account and wants to gift his 3 kids $19k each.

He planned to sell stocks and give them cash, but it's a massive tax mistake.

Here's what he should do instead: An acquaintance decided to gift 3 of his kids $19k each.

Some for tuition money.

Some for buying a car.

Some for necessities.

Want to build wealth for your child?

There are many options - 529 plans, UTMA, IRAs, and brokerage accounts.

Here's how to give your kid a financial head start:

(bookmark for reference) There are a lot of options to invest in for your child.

Let me go over some options:

1. 529 Plan

JPM’s 56-page "2025 Guide to Retirement" just came out.

I went through it so you don’t have to.

Here are 8 things worth knowing: How long will I live?

If you are 65, a non-smoker, and in excellent health, you have a pretty high chance of living until 85.

Given this, your portfolio should still have some equity allocation to sustain growth:

Today is Tax Day.

If you got a huge refund or owed way more than expected for 2024, your W-4 Form is probably wrong.

Let’s fix that for 2025:

(thread) First, what is a W-4?

It's a form that you fill out so that your employer withholds just enough taxes from your W-2 job.

It can be tricky to get it right...

Treasury Bill Ladder is a great way to:

- earn a 4.25% yield
- stay liquid
- avoid expense ratios
- 100% state/local tax exempt

Here's how to setup your own ladder:
🧵 A Treasury Bill ladder is an investment strategy that spreads your money across several Treasury Bills with similar or different maturity dates.

note: this strategy is typically used for short term savings/emergency funds