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VUE | Winter 2022

The Digest | New Jersey Magazine

Issue link: https://magazines.vuenj.com/i/1441017

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DEFER INCOME Employing strategies where you can defer some of your taxes for a long time, can provide savings that are substantial. A retirement plan is a perfect example. "Maximizing 401k contributions reduces taxable income and defers taxes until retirement. Depending on your employer's contribution match, this could also mean free money beyond tax savings" says Sankar. IT'S A FAMILY AFFAIR Over 30% of businesses in America are small businesses, and there are amazing opportunities to leverage your family business for tax savings. Filing jointly with a spouse may provide greater savings on Section 199A where up to 20% of qualified business income (QBI) may be deducted. Employing children in the family business can also have many benefits. For example, a child may be employed for bookkeeping and compensated to a salary threshold of $10,000-$12,000. That same salary could see exponential growth if it's placed into a Roth IRA in the child's name. V U E N J .C O M 94

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