The amount of income you report for tax purposes and the way you file your tax returns both have significant bearing on the amount of taxes you pay. The taxes you pay depend in part on your filing status, the category that identifies you based on your marital status and family situation. One way of reducing income taxes is to use a technique known as income shifting. This can be done by creating trusts or custodial accounts or by making outright gifts of income-producing property to family members. Another strategy is to use tax shelters.
Tax shelters are forms of investments that take advantage of certain tax write-offs.
In accounting terminology, these write-offs are called depreciation, amortization, or depletion. Still another strategy that is widely used is tax deferrals. Income that is tax-deferred does not cause taxes to be paid now, but delays their payment to a future date. Joseph Greene, Cree Walker Professor of Business Administration Get in Shape 1. Getting fit is a matter of Behavioral Change that will reinforce the results that are desired.