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Our situation:

we bought rental property last year. Anticipating having to spend a good chunk of money on the property and improvements/repairs, we amended our W-4s so we would have more cash. At tax filing time, we got a large ($4500) refund.

Our stats: I make $40k; he was making $58k until 6/1; after that his salary will be $72k. Our interest income is under $400. So far, I put $240 a month into a 401k; he puts $200 month into a 401k. We both have mandatory retirement taken out before taxes (8%)

Things have changed drastically for 2003. My husband will take a new job 6/1 that will increase his salary by $13K a year. He will also get vacation pay that will add about $4000 to his income. We are selling some land (closing on 7/1) (not primary residence) for $250K with a cost basis of $65,000. We will have about $7000 rental income.

I know we're going to take a big capital gains tax and income tax hit.

So far, I'm thinking we can adjust our W-4s back to 0 and increase our 401ks to the maximum.

We plan to try to hold off on doing any deductable rental expenses until 2004 unless absolutely neccesary, since I don't think we'll be able to deduct any this year.

We do have some loser stocks that we could sell for a capital loss, if that would help.

Any ideas on ways to reduce our 2003 tax bill, expecially regarding the capital gains?

Is the above info enough to start off with an accountant, and is that where I should look to for guidance, as opposed to a tax attorney>

Thanks in advance,


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