Unlike tax preparers who can help with tax filing and deductions during tax season, we are monitor the impact of taxes on a client’s portfolio all year-round. Because taxes and investments go hand-in-hand, we can assist clients with strategies at every life stage to help reduce their tax liability and stay on track to achieve their financial goals. We consider things like the timing of your income and large purchases, future expenses, and the types of investments or retirement plans that you have when developing strategies for your particular situation.

While you are still working, your tax planning strategy may include investing in a tax-deferred retirement plan that reduces your taxable income. This can be effective if you have a high income now, but anticipate potentially being in a lower tax bracket in retirement. Another option for high-income earners is a “backdoor” Roth IRA in which you first contribute to a traditional IRA and then convert that portion to a Roth IRA. This allows you to bypass IRS income limits and grow the converted assets tax free. However, income tax will be due in the year of the conversion as well as on any investment gains. Be sure to consult with your financial planner or tax preparer about your unique situation before implementing any changes.

When you begin retirement and withdraw your assets, tax planning is also important to ensure that you stay in a beneficial tax bracket and optimize your Medicare and Social Security benefits. To help minimize taxes, we consider which accounts you should withdraw from first (taxable, tax-deferred, tax-exempt), the impact of receiving Social Security Benefits, or possibly recommend a transfer of your required minimum distributions (RMDs) to your favorite charitable organization (subject to IRS limitations).

Once you are fully retired, we consider adjusting your investment strategy to minimize taxes, reduce risk, and help maximize your savings. If you have underperforming investments, we can help with tax-loss harvesting, which is a tactic used to help offset any capital gains as you rebalance your portfolio.

We work also closely with estate planning attorneys to help our clients structure tax-favorable wealth transfer strategies, with the goal of leaving more assets to their children or a charitable organization.