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Using charitable trusts is another way to reduce income tax, especially for the ones who belong to high income group as these trusts help you to give charity generously, giving you a big tax break (Karayan & Swenson, 2006).
At the time of selling of valuable assets, one can easily minimize Capital Gains tax with the help of one of the most secure asset protection program known as Private Annuity Tax (PAT) which minimizes even smaller properties like artwork or jewelry. When a property is transferred into PAT, it results in smaller tax expense. Another way of minimizing Capital Gains is to get an ISA (Individual Savings Account). Investors can put sufficient funds in ISA and gains made inside this account are CGT-free. Moreover, one more strategy is used which is: Investing in small companies through special tax efficient programs. In this way, one can claim for Capital Gains tax previously paid.
One of the most popular vehicles used to reduce Estate tax is to ‘uniform transfer to minors’. Such type of gifting occurs where your children are minors. The gift is handed over to a guardian and when the children reach the age of majority. Marital transfers is another useful way in which assets are transferred to a surviving spouse, who should not be a non-citizen, which minimized the estate tax which is due. Lastly, Quality Family-Owned Business Interest (QFOBI) is another way in which it reduces the gross value of the state and automatically reduces the amount of estate tax which is charged on the net value of the state (Karayan, et al., 2002).
I am very much hopeful that I have provided you significant and useful amount of information about the vehicles for reducing taxes and these vehicles could be regarded as substantial means for taxes
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