Tax shelter for student use
I am a teacher with an annual salary of $17,000 plus rental income of $2,600 and miscellaneous income of $1,500. Last year I paid $3,700 in federal and state income taxes. I need a tax shelter for $8,000 of income, as I plan to attend graduate school for there years and anticipate a need for income. Could a tax shelter help or would I be better off looking for high yields? R.S.
You already have one of the best tax shelters in your rental property. Tax shelters other than real estate don't really work for persons with your income. If you could find a satisfactory high yield, possibly an income mutual fund or investment in income stocks, you could pay the income tax and still have more cash left than attempting to buy tax-free municipal bonds. Other tax shelters, such as Keogh or IRA, are desinged to bui ld retirement funds.