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You need to have 112% of your 2002 federal taxes withheld or paid as an estimated tax payment to avoid underpayment penalties. Reducing the exemptions to 0 would probably be sufficient to meet the safe habor. Most employers also allow requesting additional withholding. Remember to check your state withholding requirements.

You will not be eligible for a ROTH IRA or deductible IRA. Maximizing your 401K contributions is a good choice.

Your income will exceed the limit for deducting real estate losses but the loss can be carried forward.

A 1031 exchange might be possible if you are planning on buying other real estate. You need to be careful about what is considered equivalent property. If you are interested, try talking to your real estate agent.

You do not have a legal tax problem but are looking for tax planning advice. An enrolled agent or CPA seems more reasonable than a tax attorney. Someone local would understand both federal and local tax laws. Would you consider asking you friend for recommendations?

I believe that stock losses can be used to offset real estate gains. Both are reported on schedule D.

Debra
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