I share with you my personal strategies to avoid paying taxes on investment gains. I figured out these secrets on my own over the years, and now I use them to pay minimal taxes on my stock market earnings.
1. Roll over 401-K into IRA, and make all short-term investments with your IRA. Use your separate savings/investment account for long-term investments.
2. Longer holding time (several years, or at least 1 year). Less than 1 year holding time exposes your gains to the higher tax rate. 1 year holding gets you the lower capital gains tax rate. Much longer holding time allows you to avoid paying gains taxes altogether until you sell.
3. Offset short-term gains with short-term losses. If you must sell a short-term investment for a gain, try to offset the gain by also selling one of your losers.
DISCLAIMER: Joe James is not an accountant or registered investment adviser. All investment and financial opinions expressed by Joe James are from personal research and experience and are intended to be used for informational purposes only. It is very important to do your own analysis before making any investment based on your own personal circumstances. Past performance is not a guarantee of future return.