Actually, luck has little to do with it. Good tax planning is about putting yourself in the best possible position.
Strategy: Here are 13 ways to cut taxes midway through the year. Several of these tax breaks were extended by the American Taxpayer Relief Act (ATRA) passed at the beginning of this year.
1. Harvest capital gains or losses. Have you already picked off winners from securities sales in 2013? Any capital losses realized between now and the end of the year can offset those capital gains plus up to $3,000 of ordinary income. (Any remaining loss is carried forward to 2014). Reminder: The maximum 15% tax rate on long-term capital gains jumps to 20% for single filers with income above $400,000 and joint filers with income above $450,000. Short-term gains for taxpayers above these thresholds are taxed at rates reaching as high as 39.6%.
Tip: You might also have to pay a 3.8% Medicare surtax on certain investment income...(register to read more)