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Deferring compensation can be a tax-saving strategy by postponing the receipt of income to a future year, potentially lowering your taxable income for the current year. Here are some common ways to defer compensation: 1. Retirement accounts: Contributing to retirement accounts like 401(k), 403(b), or traditional IRAs can help defer taxes on that income until you withdraw the funds in retirement. These contributions are typically made on a pre-tax basis, reducing your current taxable income. 2. Stock options: If your employer offers stock options, you can defer recognizing income until you exercise the options. The difference between the stock's market value at the time of exercise and the option price will be taxed as ordinary income in the year you exercise the options. 3. Restricted stock units (RSUs): Receiving RSUs from your employer allows you to defer taxation until the stocks vest. Upon vesting, the fair market value of the shares is considered taxable income. 4. Nonqualified deferred compensation (NQDC) plans: NQDC plans are arrangements between an employer and an employee to defer a portion of the employee's income until a future date. Taxes on the deferred amount are postponed until the funds are paid out. Be cautious with NQDC plans, as they can come with certain risks since they're not protected by ERISA like qualified plans (e.g., 401k). 5. Salary deferrals: In some cases, you might be able to negotiate with your employer to defer part of your salary to a future year. This could involve delaying bonuses, commissions, or other forms of compensation. This option is less common and might not be available to everyone. Before implementing any of these strategies, make sure to understand the tax implications, limitations on contributions, and any potential risks. It's a good idea to consult a tax or financial advisor to evaluate which options would work best for your situation.