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The No. 1 Reason You Pay Too Much in Taxes

No one likes to pay a huge amount in income taxes. But as it turns out, many taxpayers pay more taxes than they have to for a very simple reason: they're too scared to take the deductions and credits they're entitled to take.

In the following segment from their video introducing investors to several essential investment planning topics, Motley Fool director of investment planning Dan Caplinger talks with Fool markets/IP bureau chief Mike Klesta about this key mistake taxpayers make with their tax planning. Dan notes that people are scared of getting audited by the IRS, and so they'll choose not to take deductions and credits even though they're clearly eligible to receive them. Given the relatively low rates of audits, however, Dan concludes that it's almost always smarter to go ahead and claim all the tax benefits that apply to your situation rather than leaving money on the table that you could have put in your own pocket.

Is Uncle Sam about to claim 40% of your hard-earned assets?
Thanks to a 2013 law called the American Taxpayer Relief Act, or ATRA, he can, and will, if you aren't properly prepared.

Fortunately, The Motley Fool recently uncovered an arsenal of little-known loopholes to protect yourself from ATRA and help keep the taxman at bay when he inevitably comes calling. We reveal them all in a brand-new special report. Simply click the following link for instant, 100% free access.

Protect my hard-earned wealth from Uncle Sam


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Dan Caplinger
TMFGalagan

Dan Caplinger has been a contract writer for the Motley Fool since 2006. As the Fool's Director of Investment Planning, Dan oversees much of the personal-finance and investment-planning content published daily on Fool.com. With a background as an estate-planning attorney and independent financial consultant, Dan's articles are based on more than 20 years of experience from all angles of the financial world.

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