Question

how can you reduce your tax liability and/or avoid paying taxes when you file this year legally

Answer 1

This would depend on the country where you are filing your tax return.

In most of the countries, showing the following will reduce your tax liability:

1. Donations / Charity made to recognised institutes with receipts

2. If you are self employed and your business is not profitable, you are eligible for certain tax exemptions

3. Certain special rules also apply to meals and entertainment expenses, travel expenses and other benefits shown for employees (In case you are running a business)

4. If you operate your business as a regular corporation, the corporation pays its own taxes at the corporate tax rates (which may be lower than your individual rate) and you are taxed only on income received from the corporation.

5. Structure a transaction such that payments received are classified as capital gains, rather than ordinary income. Long-term capital gains earned by noncorporate taxpayers are subject to lower tax rates than other income.

6. For personal tax exemption you can qualify your children, parents and maybe other relatives as dependents and get a tax exemption

There could be many other ways of getting a tax exemption by reducing tax liabilities depending on whether it is for personal or business, single or married, and which country. Let me know if you need further advise on this.

Thanks, all the best.