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2021 Last-Minute Section 199A Tax Reduction Strategies

November 9, 2021

If your taxable income is above $164,900 (or $329,800 on a joint return), then your type of business, wages paid, and property can reduce and/or eliminate your Section 199A tax deduction.

The combinations can create confusion, but you can lessen the confusion by using the 2021 Section 199A calculator.

Want to stay on the safe side?

Read my new article titled 2021 Last-Minute Section 199A Tax Reduction Strategies to check out how the following three strategies can help you improve your Section 199A deduction:

  1. Harvest capital losses if you have capital gain income that’s causing the trouble.
  2. Make charitable contributions to increase your itemized deductions and reduce your taxable income—and consider donating appreciated long-term-gain stock to come out even better.
  3. Buy and place in service before midnight on December 31, 2021, business assets that you can expense 100 percent to lower your taxable income. (This also lowers your QBI, but if you need lower taxable income to gain the Section 199 deduction, it’s a good strategy.)

Filed Under: Capital Gains, Charity, Depreciation, Filing tips, Section 179, Tax Planning

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