Are you familiar with income phase-out levels for those tax credits and deductions you hope to take advantage of on your 2011 tax return? While it doesn’t make sense to make less income just to qualify for a tax break, shifting income from one year to another may sometimes be a smart move.
Learn about the tax credits and deductions for which you might qualify. Then estimate your income for this year, and if it will be just beyond qualification range, look for opportunities to defer income until a later year. Investment income can often be shifted, or you might delay the exercise of stock options or the receipt of a bonus.