Utilizing Health Savings Accounts (HSAs)
Health Savings Accounts are often overlooked in retirement planning but can offer triple tax benefits: tax-deductible contributions, tax-free growth, and tax-free withdrawals for qualified medical expenses. After age 65, you can withdraw funds for non-medical expenses without the usual penalty, though these withdrawals will be taxed whatsapp philippines number as income, akin to a traditional retirement account.
Harvesting Tax Losses
App developers can also use tax-loss harvesting in their taxable investment accounts to offset the gains by selling off investments that have incurred losses. Remember that the 'wash-sale' rule prevents you from claiming a loss on a security if you repurchase a ‘substantially identical’ one within 30 days before or after the sale. Thus, planning the timing of your buy-sell decisions can be critical.
Staying Updated on Tax Laws
Tax laws are subject to change, and staying informed can help you maximize savings strategies. For instance, new laws may offer deductions, credits, or retirement contribution limit changes that could affect your plans. Regularly reviewing tax regulations or working with a tax advisor will ensure you're taking advantage of all the benefits afforded to you as an independent developer.
Tapping into Passive Income
Leveraging your skills, you might create an app that provides a stream of passive income which, if structured properly, can also offer tax advantages. Be sure to investigate the potential for depreciation, amortization, or even being taxed at a lower rate for long-term capital gains, depending on the nature of your passive revenue.