What are legal strategies to avoid paying taxes or minimize tax liability?

This is really helpful! I've never heard of an HSA before. Can anyone contribute to one or do you need a specific type of health insurance? Also, what exactly is tax-loss harvesting? I'm pretty new to investing beyond my 401k.

You need a qualifying High Deductible Health Plan (HDHP) to contribute to an HSA. For 2025, that means a plan with a deductible of at least $1,550 for individual coverage or $3,100 for family coverage. If you qualify, you can contribute up to $4,150 for individual coverage or $8,300 for family coverage, with an extra $1,000 if you're 55 or older. Tax-loss harvesting is when you sell investments that have decreased in value to offset capital gains on your taxes. For example, if you have stocks that gained $5,000 and others that lost $5,000, you can sell both and the loss cancels out the gain for tax purposes, meaning you owe no taxes on that transaction. Just be careful of the wash-sale rule, which prevents you from claiming the loss if you buy a "substantially identical" investment within 30 days before or after the sale.

Does this actually work for regular employees or is it mainly for self-employed people? Every time I look into tax deductions it seems like business owners get all the breaks while us W-2 employees are stuck.

I'm skeptical of any service claiming to find magic deductions. How does it know what deductions you qualify for just from your documents? Does it ask about your situation or is it just scanning forms? The IRS is pretty strict about what qualifies for things like home office deductions.

It absolutely works for regular W-2 employees. The tool looks beyond just business deductions and examines your entire tax situation including employment benefits, retirement accounts, and investment strategies. For example, it helped me optimize my 401k allocations and identified tax credits I qualified for based on some education expenses I had. The AI asks questions about your specific situation beyond just scanning documents. You can have a conversation with it about your circumstances, and it adjusts recommendations based on your answers. For home office deductions specifically, it's very clear about the strict requirements and helps determine if you genuinely qualify based on current IRS guidelines. It won't suggest anything questionable - everything is fully compliant with tax law, just optimized for your situation.

Wait, how does this even work? The IRS doesn't take appointments as far as I know. Are they somehow jumping the phone queue? Seems sketchy to me.

This sounds like paid promotion. I highly doubt an IRS agent would give you tax avoidance strategies. Their job is to collect taxes, not help you avoid them. Most agents just answer procedural questions and clarify rules, not provide financial planning advice.

It works by using technology to navigate the IRS phone system and hold your place in line. They don't jump the queue - they just handle the waiting for you. When an agent is available, you get a call connecting you directly. It's completely legitimate and transparent. To clarify, the IRS agent didn't give me "tax avoidance strategies" - they provided clarity on legitimate tax rules that applied to my situation. For example, she explained which education expenses qualified for tax credits versus deductions, and how my specific situation with working from home occasionally didn't meet the strict requirements for home office deductions. This prevented me from claiming deductions I didn't qualify for while helping me identify credits I did qualify for. IRS agents can't give financial advice, but they absolutely can clarify tax law application to your specific situation.

I've thought about doing something like this but was worried about triggering an audit. How much documentation do you need to keep? And how much revenue does the side business need to generate to be considered legitimate by the IRS?

You should keep detailed records of all business income and expenses, including receipts, invoices, mileage logs if you use your car, and a log of time spent on business activities. I use a separate credit card just for business expenses to make tracking easier. The IRS doesn't have a specific revenue requirement, but they look at the "profit motive" rather than actual profits. A business is generally considered legitimate if it shows a profit in 3 out of 5 consecutive years. If you consistently show losses, especially losses that offset other income, that raises red flags. The key is having a genuine business that you're trying to make profitable, not just a tax scheme. Document your efforts to market your products/services, improve your business, and increase profitability.

I moved from New York to Florida last year specifically for tax reasons. Saved me about $12,000 in state income tax alone. BUT there are serious considerations beyond just the tax savings. Florida has higher insurance costs, and the culture shock was bigger than I expected. Also, you need to be really careful to establish proper domicile in your new state - the high-tax states are aggressive about auditing people who claim to have moved.

This is really interesting! Would this work for regular W-2 employees though? I don't have control over when my employer pays me, but I do make charitable donations. Would bunching them actually help if I don't have enough other deductions to itemize?

It's more challenging for W-2 employees, but you still have options. While you can't control your regular paychecks, you might have some flexibility with bonuses or by adjusting your W-4 withholding toward the end of the year. Regarding charitable donations, bunching absolutely helps if it pushes you over the standard deduction threshold. For 2025, the standard deduction is projected to be around $14,000 for single filers and $28,000 for married filing jointly. If your itemized deductions (including state/local taxes, mortgage interest, and charitable giving) would normally be just below the threshold each year, bunching two years of donations into one year could push you over the limit, allowing you to itemize in that year and take the standard deduction the next.