Hi everyone and welcome back to Money Girls Quick and Dirty Tips for a richer life.

I'm Laura Adams. Tax shelters have gotten a bad rap. Some are illegal, like offshore companies and bank accounts that hide money from Uncle Sam. But there are plenty of tax shelters for us law-abiding citizens too.

A tax shelter is simply a way to reduce your taxable income,

so you pay less tax, no matter how much or how little money you make.

In this show I'll point out some common legal ways to reduce your taxes and save more money.

And if you want to learn more just visit the blog at money girl

quick and dirty tips.com where you'll find links to just about

everything that I mentioned in this podcast. Now on to tax shelters. Not only is real estate a real shelter, but it's a powerful

tax shelter too. I mentioned some of the valuable tax benefits of homeownership in last week's show titled

should you rent or buy a home. When you buy real estate, you cut your taxes the

year you buy it, every year you own it, and even on the back end when you sell it.

Mortgage points paid on a loan, mortgage interest,

private mortgage insurance, and property taxes

are typical tax deductions for homeowners.

If you tap into your home's equity with a loan or a line of credit, you may also be able to

deduct some of the interest you pay on that debt too.

If you decide to sell your main home and have lived there for at least two years,

you get to keep up to $250,000 of capital gains or profit on the sale tax-free.

If you're married and file a joint tax return, or profit on the sale tax free.

If you're married and file a joint tax return,

you can avoid taxes on up to $500,000 as a couple.

Additionally, the costs for selling a home,

...