I have been following various forums in regard to what is the best apr being offered by online banks. Like many others I also play the whole rate chasing game, where you dump your money into a bank account that currently offers the highest apr. I actually have made a decent amount by utilizing this strategy. Overall I'd like to one day see a bank where I get both the highest savings and checking account apr's, but until then I am currently utilizing ING's Orange Checking and a Bank of America Affinity money market account.
The one disadvantage I see with playing the rate chasing game is that the interest earned is taxable. How do you guys go about decreasing the amount taxed, more specifically do you guys deduct anything? One CPA who I talked to earlier mentioned that I could deduct the expenses related to making this money. For example I could deduct my cable internet costs, my computer's value, etc. Has anyone gone about making such deductions when rate chasing?
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