Tax Planning Explained
Tax planning is the practice of being strategic about when and how much you pay to the IRS. If you haven’t been strategic about your taxes, you probably pay more than you’re legally required to. By using tax planning, we can help you minimize your tax burden. This includes taking advantage of tax breaks, planning your income distributions, preventing highly taxable events, and using deductions and credits to reduce your tax liability.
Our firm has over 30 years of experience helping our clients with customized tax reduction strategies. Our team can help you maximize gains, cut losses, and retain wealth. Tax planning continues when you receive retirement income. We can help you plan your retirement income distributions to reduce your taxes and allow you to keep more of your income
We customize our tax planning strategies for your financial situation. We consider your current income sources, investment accounts, and potential deductions and credits to create a plan that reduces your tax burden. Here are some examples of what we do to make the tax code work for you:
- Maximize contributions to tax-deferred retirement accounts
- Prevent highly taxable events, such as capital gains tax on the sale of assets
- Evaluate benefits of Roth conversions and other vehicles for tax-free retirement income
- Manage your distributions in retirement to avoid taxes on Social Security and Medicare
- Mitigate estate taxes with an estate plan
- Develop a strategy to avoid "stealth taxes" that can quickly wipe out savings
Can Tax Planning Save Me Money?
Absolutely. Instead of looking for tax deductions and credits after the fact, tax planning involves being deliberate about your financial decisions. Every investment decision you make will affect your tax return. It’s our job to help you maximize your after-tax earnings.
What Should I Consider When I Think about Taxes?
When you think about tax planning, we want to consider your retirement and investment accounts to reduce your tax burden. It can mean contributing to a tax-deferred investment account, using Roth accounts to receive tax-free income in retirement, and preventing excess capital gains taxes on your investment earnings.
Why Is Tax Planning Important?
It takes money, time, and dedication to build significant wealth. The more money you spend on taxes, the less you have available to save or invest. We can help you prioritize your investment goals for the future while minimizing your taxes. And since there’s no benefit to paying more than you’re required to, it’s in your best interest to use tax planning to reduce your taxes.
Am I Paying Too Much in Taxes?
If you haven’t used tax planning, there’s a good chance you’re paying more in taxes than you have to. We can review your financial situation and talk to you about minimizing your tax obligation. It’s important to use a holistic view of your finances to create the best tax reduction strategy for your situation.