Is it possible to pay $0 in taxes on a six-figure income? Yes it is and here is how you do it.

42-year-olds-taxes
Source:  Investor Junkie
It is worth going through each section individually.  Here we are assuming a couple that is both working.  Their combined income is $110,000 per year.  They max out their 401k contributions of $18,000 per year.  Next, one of the above works as a teacher with the access to a 457 account.  This essentially is another 401k for public sector workers.  They put $18,000 here as well.  Next, you are able to stash $5,500 per year in a traditional IRA so you can lower your taxable income.
Next, they utilize their HSA account to the tune of $1,000.  They have a child in daycare and spend $5,000 a year here and are able to adjust their income lower here too.
So with all of that, their adjusted gross income drops from $110,000 to $39,000.  The tax at this level for a couple with a kid is $1,440.  Taking the child tax credit of $1,000 and the retirement credit of $800 they will actually get a refund of $360.

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