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We are setting up his "payroll" status and are looking for tips on ANY legal ways that we can reduce the amount of tax they deduct at the source.

Get a job in Canada. Just Kidding! The amount of money withheld by your employer is actually unrelated to the amount of tax you will end up owing (and hopefully paying, thus avoiding unspeakable horrors). You fill out a form called a W4 which tells your employer how much to withhold. There is a worksheet to help you figure out a proper amount. If you do not have enough withheld to cover the tax you owe at the end of the year (actually by the following April 15th), you may be subject to a penalty, if the shortfall exceeds $1,000. You can adjust during the year if things change. A number of things can be deducted from your gross income to establish your taxable income. They include medical expenses, home mortgage interest, property taxes, state and local income taxes, charitable contributions and some other things. You should definitely hire a professional for your first time through this maze. Good luck!
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