Hey Jeremy,
Im about to receive a bonus from work. Is there something I can do to minimise the tax ill pay on it come tax season?
Any suggestion is appreciated. Im a legal permanent resident here if that helps.
I plan to maximize my roth for 2022 & 2023 & probably invest the rest or set it as a down payment for a home but I want to do it in such a way to pay the least tax possible on it.
Thank you!
Hi @dikran961!
Congratulations on your upcoming bonus!! Bonus’s are taxed the same as the rest of your income (unless it’s viewed as supplemental income). Sometimes the withholdings can be higher depending on your payroll provider.
The main options to lower your taxes include:
- Traditional 401(k) contribution
- Traditional IRA contribution
- HSA contribution
- Charitable donations
These depend on your overall situation, but may be worth looking into if you would like to lower your taxable income. It can be nice to reduce your tax bill, but maximizing your long-term wealth building journey is most important. A financial planner / tax advisor may be worth consulting with as well if you would like to dive deeper into your options!
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