These hacks help millionaires keep more of their money. Here’s how you can use them, too — and take advantage of new tax tricks available in 2026

But could these tax strategies be adapted for households with more typical incomes? While not all will apply, some may be accessible to middle- and upper-middle-class earners, too.

Beyond these strategies, 2026’s temporary tax changes — like the expanded SALT deduction cap and a new seniors’ deduction — could help keep more of your money, even if you’re not a millionaire.

3 tax optimization strategies

Incorporate

If you’re self-employed, one way to potentially save thousands in taxes is by incorporating your business. That means creating a corporation and classifying your earnings as business income. That way, you pay a lower tax rate on that money.

Personal income tax rates at the federal level range from 10% to 37%, but total taxes — including state and local taxes — could end up being much higher (2). Since 2018, the federal corporate tax rate has sat at 21%. Even when accounting for state corporate taxes (which are below 10%), the total could still come in lower than your personal tax rate (3).

If you are a business, that turns your salary into an expense — and business expenses are deductible. It’s the same story with health insurance premiums, accounting fees and business vehicle costs. However, your salary will still be taxed at your personal rate, while you keep the rest of your money tied up in the business, to be taxed at the corporate rate.

Some estimates say that if you make, at minimum, a net of $60,000 in freelance or small-business income, you may save money overall by incorporating — meaning you don’t have to be a millionaire to benefit from this strategy.

However, incorporating also comes with a significant administrative burden — so you’ll have to weigh the pros and cons carefully. It’s worth talking to a lawyer and your accountant before making any moves (4).

Buy, borrow, die

A second option is turning income into a loan — aka the “buy, borrow, die” strategy, in which you purchase appreciating assets like stocks, art or real estate, and then borrow against them for your income instead of selling.

“Upon death, it may be possible to transfer collateral assets to a beneficiary without paying capital gains tax,” according to Stacker (1).

Related: 7 ways to grow your tax refund

Tax-loss harvesting

This strategy uses capital losses to your advantage by reducing the tax you owe.

In a year where you owe capital-gains tax on assets you have cashed out, you can offset this by strategically selling a different asset at a loss. This can be used against gains you have already realized, or gains you anticipate in the future, according to JP Morgan (5).

Tax optimization for average incomes

While turning income into a loan or tax-loss harvesting may not be realistic for most with a modest income, there are other ways to trim your tax bill.

For example, make sure you’re not missing out on opportunities to reduce your taxable income. “Keep an eye on credits and deductions you may be able to claim for medical treatments, training and education, moving (relocating), working from home, donating to charity and other costs,” the Stacker analysis suggests (1).

While it’s too late to top up your 401(k) for the 2025 tax season, you can aim to max out any tax-advantaged retirement accounts this year for next season. Since funds are contributed on a pre-tax basis, they don’t count toward your income for the year. Instead, you pay taxes later on, when you withdraw funds in retirement, when you are ideally in a lower tax bracket.

In 2026, you can contribute up to $24,500 in your 401(k), 403(b), governmental 457 plan or Thrift Savings Plan. The catch-up contribution limit has increased to $8,000 for those 50+ and $11,250 for those aged 60 to 64 (6).

Meanwhile, temporary tax changes this year could also help lower your tax bill. These include:

• a maximum $200 increase in the child tax credit
• a standard deduction increase of $750 for single filers and $1,500 for joint filers
• a new deduction up to $25,000 for tip income
• a new deduction up to $12,500 for overtime income (7)

Another change is the state and local tax (SALT) deduction cap increase, in which you itemize tax breaks rather than claiming the standard deduction, to reduce your federally taxable income.

From 2018 to 2024, the cap was set at $10,000 for single filers and $5,000 if married and filing separate returns. Under the One Big Beautiful Bill (OBBB), enacted in July 2025, that cap has jumped to $40,000 (or $20,000 if married and filing separately) for the 2025 tax year, increasing 1% each year until 2030 — when it will drop back to $10,000 (8).