There have been threads on here about people who will spend money at the end of the year just to avoid taxes, at the advice of their CPA's. Here is the mathematical proof of why this is not sensible. Say for instance you end the year with an extra 20,000. Some would go buy a new truck and save the tax expenses. I say pay the taxes and keep the cash. Purchasing something that loses value does not make sense. Say you pay 20,000 for the truck, now you have higher insurance due to the newer vehicle, and higher taxes. The truck will not stay at a value of 20,000. Within a few years it is worth less than half that. If you take the 20,000 and pay the taxes you will be left with about 12,500. That is 12,500 you will never have to pay taxes on again. EVER. If you put that 12,500 in a CD at 5%. In a year you will make $625 in interest. The taxes on that interest will be around 200 so you now have 12,925 in the bank. You can also roll over extra money from that year. If for 10 years you roll 10,000 every year into an account earning 5% this is what it would look like. after year 1 10,000 put into cd@5%. after year 2 350 in interest after taxes plus another 10,000 total 20,350 after year 3 759 in interest after taxes plus another 10,000 total 31,109 after year 4 1166 in interest after taxes plus another 10,000 total, 42275 after year 5 1585 in interest after taxes plus another 10,000-total, 53,860 after year 6 2109 in interest after taxes plus another 10,000-total, 65,879 after year 7 2470 in interest after taxes plus another 10,000-total, 78,349 after year 8 2938 in interest after taxes plus another 10,000-total, 91,287 after year 9 3423 in interest after taxes plus another 10,000-total,104,710 after year 10, 3926 in interest after taxes plus another 10,000-total,118636 total interest made over the 10 year period, after taxes are paid on the interest is about 18,726 Listening to a CPA will make you cash poor in a heartbeat. They want you spending money because it keeps you coming back and paying for their advice. This is why i keep my older trucks, that are paid for, and save what is leftover every year rather than look for something to waste it on. It doesnt take long to have a nice cash wad in the bank. And the larger it gets the faster it grows. Within 15 years you could make enough in interest to make a payment on a new truck, and still have the cash wad in the bank.