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My startup company got acquired last week. I’ll get ~ 300K (2017 taxable event). What are things I can / should do to limit my tax hit? (Gifts, other?)
My wife and I file jointly. We live in California. Our AGI for 2016 was $230,000. AGI for 2017 will be similar. I've held stock in the company since it was founded in 2006.
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June 6, 2019
6:54 AM
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Hi SweetieJean. We initially calculated the payout to be ~ 300K. (Stocks were initially worth $0.0001 per share, so nearly all of that will be GAIN). Even if my numbers are off somewhat, we'll have a big long-term capital gains hit.
So my core question is:
What types of things can I do to limit / offset this tax hit?
Of those options, what do I need to do before the end of the year?*
*I'm assuming I'll have to move quick and do some things before the end of 2017 (like gifting or inheritance to our son, etc)...
So my core question is:
What types of things can I do to limit / offset this tax hit?
Of those options, what do I need to do before the end of the year?*
*I'm assuming I'll have to move quick and do some things before the end of 2017 (like gifting or inheritance to our son, etc)...
June 6, 2019
6:54 AM
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So your total 2017 income will be approx $260k + $300k = $560k?
June 6, 2019
6:54 AM
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Maxing out your retirement contributions and charitable donations are the main things you can do to reduce your total income tax.
Contributing to a HSA (if you qualify) is good. In some cases paying your 2017 4th quarter State Estimated Tax payment and pre-paying your 2018 Real Estate taxes may help.
Gifts to Individuals, such as your son, are not tax deductible.
Contributing to a HSA (if you qualify) is good. In some cases paying your 2017 4th quarter State Estimated Tax payment and pre-paying your 2018 Real Estate taxes may help.
Gifts to Individuals, such as your son, are not tax deductible.
June 6, 2019
6:54 AM
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Also be aware that itemized deductions phaseout at that income level.
<a rel="nofollow" target="_blank" href="https://www.forbes.com/sites/kellyphillipserb/2017/04/05/taxes-from-a-to-z-2017-p-is-for-pease-limit...>
And see:
<a rel="nofollow" target="_blank" href="https://www.irs.gov/newsroom/net-investment-income-tax-faqs">https://www.irs.gov/newsroom/net-invest...>
<a rel="nofollow" target="_blank" href="https://www.forbes.com/sites/kellyphillipserb/2017/04/05/taxes-from-a-to-z-2017-p-is-for-pease-limit...>
And see:
<a rel="nofollow" target="_blank" href="https://www.irs.gov/newsroom/net-investment-income-tax-faqs">https://www.irs.gov/newsroom/net-invest...>
June 6, 2019
6:54 AM