Tax Breaks

4 Overlooked Tax Breaks for Retirees

Learn how to keep your tax bill low in retirement.

Being alert to the changes that come at various life stages is key to holding down your tax bill. Use these deductions to save at tax time.

1. Deduct Medicare Premiums

If you become self-employed after you leave your job, you can deduct the premiums you pay for Medicare Part B and Part D, plus the cost of medigap policies or the cost of a Medicare Advantage plan.

2. Spousal IRA Contribution

If you’re married and your spouse is still working, he or she can contribute up to $6,500 a year to an IRA that you own.

3. Give Your Money Away

If the estate tax might be in your future, take advantage of the annual gift-tax exclusion to give up to $14,000 annually to any number of people.

4. Bigger Standard Deduction

The extra money will make it more likely you’ll take the standard deduction rather than itemizing. If you do, the additional amount will save you almost $400 if you’re in the 25% bracket.

Check out even more overlooked tax breaks for retirees.

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