Save on IRS taxes in 2025 – Tips for reducing tax liability.

How to Save on IRS taxes in 2025

Thinking to save on taxes this 2025 to spend a quality vacation or enjoy a decent meal at an expensive restaurant? That’s your birth right. But do the governments have that feeling towards your shorter goals?

No. 

So, whatever will be done, will be achieved by you yourself. Not one would care how much you’re saving or struggling this year. 

2024 was quite trying and was harder for many. 

So let’s not make 2025 another regrettable year, at least. 

So how do we save on IRS taxes that are due in April. Feeling nervous. Don’t be. Today we are going to share several ways, shortcuts, the devil’s tricks to save on taxes. 

By devilish, we really mean, you can act a little smart without getting caught and without coming on the radar. 

So let’s start. 

  1.  Commuter Benefits – rates have changed for 2025 


it was $300 back in 2023, now in 2025, the commuter benefit is $325 per month. That’s $3900 for the whole year. 

This is applicable with mass transit – keep those tickets handy, that will get you the tax reductions for sure. 

 

Mass Transit is: Buses, Subways, Uber, Lyft, Shared rides, Trains, Parking lots

DEVIL’s Tricks to save more taxes with Commuter Benefits: Invest in ride companies like Uber, but not uber; have your own brand – first it will become your asset, if you invest in it, your free rides can be claimed for tax reductions – smart isn’t it. So find some local ride company, ride-sharing services and it will get you tax reductions, have some shares and have some authority. After all you don’t want to owe to the IRS. 

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Retirement Plans

The 401K, 403(B) plans – the 401K, if you don’t know, is applicable with the for-profit companies. While 403(B) plan is for people working with Non-Profit or Governmental agencies. These plans build your retirement accounts – acts as saving for your retirement. 

 

401K, 403(B) are most commonly used plans, there are other plans too on the market (more on that later). 

DEVIL’s Tricks for Retirement Plans: So increase your deposits, you would get a tax reduction. 

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HSA – Health Savings Account

This is for people with high-deductible health plans. This lowers your taxable income, that gives you tax benefit.

This is connected with the health related expenses. 

But this needs qualified medical expenses. What are qualified medical expenses (more on this later).

 

You can also invest in HSA and earn income that is totally TAX-FREE.

DEVIL’s Trick for saving Taxes with HSA: you must have a doctor in your circle, shared a part of the taxes saved with the doctor and have an invoice made to your advantage. Sound unethical? Yeah sure, but what about those silent deductions government does, are all ethics just for the common people only?

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FSA – Flexible Spending Accounts

Now this is a bit tricky as it works on the use-it-or-lose-it model. So any balance at the end will not be rolled over to the next year. So better you use it wisely and quickly. 

 

Leftover balances are only rolled over if rollover option is exercised by your employers. 

Devil’s Trick for saving with FSA: check for qualified medical expenses and have it rented out; get someone treated for an income. That will earn you income plus save you taxes.

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Dependent Care FSA

This is childcare expense with pre-tax money. It reduces tax liability on you. This is applicable with childcare, adult care and dependents.

This works with daycares, nurseries, pre-schools, nannies, babysitters, day-camps, afterschool programs, adult daycare facilities.

Now how to save on taxes with Dependent Care FSA – here comes the devil’s trickery

Devil’s TRICKS to save TAXES with Dependent Care FSA: open up a daycare, summer school, pre-school in your local neighborhood. It can be in a partnership but if a business becomes your asset, you can not only earn but save on taxes. You would push your expenses through this outlet. 

That will make you to save on your taxes, without losing or even spending money. 

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Part II – Paying less Taxes with Investments

Capital Losses

if you’ve invested in crypto, stocks – the losses have to be reported or you end up paying the taxes. So better report losses, that do reduce taxes. 

Losses are good for tax deductions.

When reporting stock investments, the Tax Form 1099-B is required to be filled, and that is quite hard to miss.

People usually forget or miss to report crypto losses as they are uneducated to report them. 

 

Devil’s TRICK to SAVE Taxes with Capital Losses: if you’ve been making profits on stocks and don’t want to pay any taxes on these investments. Get a friend’s money and make him profits on a 5:1 ratio. 5 times profit and 1 time loss. 

First, you’ll charge your friend for trading on his behalf. 

Second, you split the profits but never the losses.

You take that loss and report it. 

Your friend(s) will want to invest with you when a friend is in profit. Handle their cash and own their losses, while they a cut out of profit. 

Even if you still have to pay taxes in the end, the fee you’ll charge your friends for services, will go into paying taxes that you owe. 

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Long-term Capital Gains

Any stock that you’ve held for over an year – is a long-term capital gain. This capital gains gets much better tax treatment. The tax rate is almost halved than the normal rate. 

 

If you can show your income below the acceptable threshold, the tax rate becomes 0% and you get to enjoy 100% profits. 

Devil’s Tricks: since we’re speaking of nickels and dimes to save here; stock earning in a couple of thousands are never bothered but it’ll buy you a decent dinner at an expensive restaurant. So here’s the advice, keep multiple stock options for over an year while you play with other stocks for a quick buck. Slow moving stocks should be balanced with fast-moving stocks. Earnings of one can be brushed with another. Losses can be shown decently to save on that tax bill. 

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Review the 1099-B Tax Form

Keep records of your stock activity as this will benefit you for tax filing after an year. The 1099-B tax form gets all the info for your stock trading activity. This form is usually available from ameritrade or any brokerage you’ve done trading through. It should be available online.

 

Make sure, no obvious mistakes are made on this form. People usually miss out the buying levels when reporting stocks, just out of ignorance, that can cost them heavy tax payments. 

Devil’s Tricks: hold some stocks that you think will give losses. Pair these with the profit-making stocks. Loss-making stocks need not be heavily invested in, but you have to show losses. So balancing here is the key. 

In the end, you don’t have to prove yourself the Casa Nova of trading to the IRS, you never want that to be. You’re just there to save on taxes, being low-profile. 

So be the low-loss profile instead. 

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Margin Interest

Margin interest is deducted. You must deduct the margin interest expenses you bore. Margin interest details are given in the 1099-B tax form. People usually miss this part as this is not available on the cover part of the form. It comes on the inside of the form. 

 

So be awake.

Gambling Losses

 

When gaming on slot machines – a W2-G form is handed over. The copy is also shared with the IRS. The winnings are reported. The W2-G amount can be reduced if losses are reported. 

Devil’s Tricks: So keep the expenses and losses’ trail handy to cover this up. Table games, betting, horse-racing – can use losing slots to offset the winners. 

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Traditional IRA

401K and 403(B) are set at the workplaces. While traditional IRA is set up outside of the work. Putting money in the IRA warrants tax reductions. 

 

More on investing with IRA later. 

529 Plan

Money put in the 529 plan (the education investment for your children, for self or someone else) warrants tax reductions. 

Taxes are not deducted on 529 plan.

 

9 states don’t have state taxes like Florida, California, Texas but with a 529 plan, tax-free benefits can be taken.

Devil’s TRICKS: launch a training program, start educating people and have your money invested in education programs. Money earned is regulated, so your money doesn’t slip into the tax circle. 

Teach yoga, programing, foreign language, car repair, makeup artistry, canvasing, painting, calligraphy – it could be anything. Show that you’re children are invested in these programs.

So start these coaching programs and you will have an asset on one-side and tax savings on the other. 

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Fix the W-4 payroll settings

Most people get penalized for incomplete or underpayments. The penalties are levied without their knowledge as they are not aware of the W-4 payroll settings that should be sorted out with the payroll department on the W-4. 

 

How much taxes are to be deducted have to mandated on W-4 to avoid tax penalties. 

Minimal Rental Usage

Home that are listed on AirBnB have to pay taxes, if, the rental period has been more than 14-days. 

Home rental for 14-days or less, will not fall in the tax bracket.

 

So money earned will be 100% tax-free. 

Devil’s Tricks: find out houses that are missing mortgage payment, offer their owners a makeover in exchange for AirBnB service outlet. You pay a certain slab money to the owner, anything above will be your profit. 

Also, if a company initiates a long-term contract, make sure the contract is renewed every 14-days. AVOID TAXES at ALL COSTS.

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Hope this must have educated you on how to reduce taxes or avoid it altogether. When you’re paying for medical, education, utilities; so why pay the already thick-bellied government. Save something for yourself and be a smart investor. 

 

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