An astounding number of Americans miss legal deductions that would decrease their taxes. As a single mother, you need to maximize any means of saving. Even if you love the government, you cannot afford to be one of its primary benefactors. You can avoid paying more taxes than necessary by following a few simple rules:

• Stay current on tax laws, use a computer tax program, or consult with a tax advisor annually.

• Put tax-advantaged investments like municipal bonds in taxable accounts, and put taxable investments in your IRA and other tax-advantaged accounts.

• If buying a mutual fund in a taxable account, make sure that the fund's turnover is low. Also, check when the fund makes its next distribution (similar to a dividend payment). Part of the distribution may be taxable, so if you buy just before a distribution you will have to immediately pay taxes on the fund's gains.

• Try to sell stock that you own after at least a year; long-term capital gains rates are much lower than rates on short-term gains.

If you have a gain in one stock and a loss on another stock, it may be worthwhile to sell both stocks so the gain on the first stock cancels out the loss on the second. This will eliminate the need to pay taxes on the gain.