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how to avoid tax on savings account
If you keep money in a regular savings account you will generally owe federal income taxes on the interest that is earned. You’ll pay taxes at your regular rate the year interest is earned, whether or not you withdraw from the account. You can avoid paying taxes on interest with the help of certain tax-advantaged accounts used to fund retirement, healthcare and education expenses. However, these accounts come with restrictions that make them unsuited to keeping emergency savings. To help you decide how to save for various purposes while minimizing your tax burden, talk to a financial advisor.
Savings Account Interest Tax Basics
The conventional savings accounts offered by most banks and credit unions and some other financial institutions, including online banks, are ideal for saving money for short-term needs. They often have some restrictions on the number of withdrawals monthly, so they aren’t as well-suited to paying regular bills as checking…
2023-07-22 08:00:57
Post from finance.yahoo.com