Taxes & Tax Planning

Taxes & Tax Planning

Taxes are most people's largest lifetime expense — larger than housing, food, or any other single cost. Yet most people do almost nothing to minimize their tax bill legally. This course teaches you how the US progressive tax system actually works, how to use tax-advantaged accounts to meaningfully reduce what you owe, and how to make smarter decisions about when and how to realize investment gains.

A foundational concept covered early is the difference between your marginal tax rate — the rate applied to your last dollar of income — and your effective tax rate — the average rate you actually pay across all your income. Misunderstanding this distinction leads many people to make costly errors: turning down raises, avoiding investment sales, or choosing the wrong retirement account type based on incorrect assumptions. Clear understanding of this concept alone is worth real money over a lifetime.

You will also explore the full suite of tax-advantaged accounts: 401(k), traditional and Roth IRA, and the Health Savings Account, which offers a triple tax advantage available nowhere else in the tax code. Additional topics include capital gains tax rates for long-term versus short-term holdings, tax-loss harvesting, the standard deduction versus itemizing, and the basics of self-employment taxes for freelancers and small business owners.