Tax Planning That Looks Beyond April 15
Tax preparation answers the question “What do I owe last year?” Tax planning answers a very different question: “What can we do this year — and over the next decade — to keep more of what we earn?” The two are not the same. Your CPA does the first one; we do the second, in close coordination with your tax preparer.
While we are not CPAs and do not file returns, tax planning is woven into nearly every recommendation we make. Many of our highest-impact moves happen quietly, years before they show up on a return. This page walks through where we focus, how the strategies fit together, and what families typically see when proactive tax planning becomes part of their financial life.
Why Most Investors Pay More Tax Than They Should
The American tax code is enormous, fragmented, and re-written constantly. The vast majority of investors miss meaningful planning opportunities not because they’re careless, but because the opportunities aren’t visible from the seat of the tax preparer (who is looking backward, at last year) or the seat of the investor (who is looking at performance, not after-tax outcomes).
The planning happens in the middle — at the intersection of investment management, retirement planning, and tax strategy. That intersection is where a fee-only fiduciary advisor adds real value. Our recommendations, made calmly and consistently across years, often save families more in taxes over a decade than our fees cost in the same period.
Roth Conversions: The Multi-Year Move That Compounds
For many pre-retirees and early retirees, a multi-year Roth conversion strategy is one of the highest-leverage tax planning opportunities available. The idea is simple in concept and surprisingly nuanced in execution: convert traditional IRA or 401(k) dollars to a Roth IRA during years when your tax bracket is unusually low, paying tax now at a known rate to avoid paying it later at an unknown (often higher) rate.
The “gap years” between retirement and the start of Social Security and Required Minimum Distributions are typically when the strategy works best. We size each year’s conversion to fill — but not overflow — the favorable brackets you’re sitting in. Over five to ten years, the cumulative benefit can be substantial: lower lifetime tax, smaller RMDs, more tax-free assets for your heirs, and more flexibility in the years you’re spending the money.
Withdrawal Sequencing: The Decision Most Plans Miss
Two retirees with identical portfolios can pay dramatically different lifetime taxes depending on the order in which they draw from their accounts. The conventional wisdom — taxable first, then tax-deferred, then Roth — is sometimes right and sometimes leaves significant value on the table.
The optimal sequence depends on your bracket, your other income, your charitable intentions, the inheritance picture, and the projected path of your RMDs. We model the full picture and design a sequence that minimizes lifetime tax, not just this year’s bill.
Capital Gains and Loss Harvesting
Two related strategies sit on the investment side of the planning conversation:
- Tax-loss harvesting. When holdings in taxable accounts trade below your cost basis, we sell them to capture the loss (which offsets current and future capital gains), and replace them with similar but not “substantially identical” holdings to maintain market exposure. Done with discipline over years, this generates a meaningful “tax alpha” for taxable investors.
- Tax-gain harvesting. The flip side. In a low-bracket year (often early retirement), realizing gains at the 0% long-term capital gains rate effectively resets your cost basis upward without owing tax. Most investors never do this because they’re not thinking ahead.
Charitable Giving, Done Strategically
For families who give regularly, a few simple structural changes can deliver significantly more impact at the same out-of-pocket cost:
- Donor-advised funds (DAFs). Bunching multiple years of giving into a single tax year — typically a high-income year — to clear the standard deduction threshold, then granting from the DAF over multiple years to your favorite charities.
- Qualified charitable distributions (QCDs). For clients 70½ or older, giving directly from an IRA to charity satisfies all or part of an RMD without the distribution being added to taxable income. Often more powerful than giving cash and itemizing.
- Gifting appreciated securities. Donating long-held appreciated stock instead of cash avoids the capital gains tax entirely and provides a full-value charitable deduction (subject to limits).
RMD and IRMAA Planning
Required Minimum Distributions begin at age 73 (under current law) and can push retirees into higher tax brackets than they expected — often triggering Medicare premium surcharges (IRMAA) that quietly add hundreds of dollars per month. The right time to start managing this is in your 60s, not when the first RMD arrives.
We project your RMD trajectory ten and twenty years out, identify the years where Roth conversions or other moves can flatten the curve, and stay ahead of the IRMAA brackets that often surprise retirees who weren’t watching for them.
Coordinated with Your CPA — Always
The best tax outcomes happen when your advisor and your CPA actually talk to each other. Too often, planning recommendations get made in isolation and never make it onto the return — or the CPA flags a planning opportunity that the investment advisor never acts on. We coordinate directly with your tax preparer, share our planning recommendations, and follow up to make sure the strategy actually shows up where it counts.
If you don’t have a CPA, or your current relationship isn’t working, we can introduce you to professionals we trust. We do not receive referral fees for these introductions; they are simply names of people we know do good work.
What Proactive Tax Planning Looks Like in Practice
- Annual tax planning review — typically in the fall, after we have a clear view of the year’s income and before year-end deadlines.
- Multi-year tax projection — modeling your bracket, RMDs, Social Security, and capital gains five to ten years forward to find the planning windows.
- Year-end moves — Roth conversions, loss harvesting, charitable giving, retirement plan contributions, and the other decisions that have to be made by December 31.
- CPA coordination — direct contact with your tax preparer so the planning actually shows up on the return.
- Mid-year check-ins as needed — major income events, capital transactions, or law changes.
Tax Planning Across the Life Stages
Tax planning isn’t a one-time event. The strategies that matter most shift as your career, family, and finances evolve. A short tour of the typical arc:
Peak earning years (40s and 50s)
The dominant question is “how much should we be saving — and where?” Maxing pre-tax retirement plans makes sense for many; Roth contributions matter for others. Mega-backdoor Roth strategies, deferred compensation elections, and concentrated stock planning (for executives) become important. For business owners, retirement plan design, entity structure, and depreciation planning can move the needle dramatically.
Pre-retirement (late 50s through retirement)
This is the highest-leverage tax planning window for most families. We start mapping the years between retirement and Required Minimum Distributions, model Roth conversion strategies, plan around Social Security claiming, project IRMAA exposure, and begin the conversations about charitable giving structure. Mistakes made in these years tend to be unrecoverable; conversely, the right moves compound for decades.
Early retirement (60s)
The “gap years” before Social Security and RMDs are where multi-year Roth conversion strategies do their best work. Capital gains harvesting in low-bracket years can effectively reset cost basis at zero tax cost. Charitable structures get implemented. Estate plan financial mechanics get reviewed and updated.
Later retirement (70s and beyond)
The focus shifts to managing RMDs, planning IRMAA brackets, executing qualified charitable distributions, and preparing the estate plan for execution. Many families also begin lifetime gifting strategies — to children, grandchildren, or charity — that they were not in a position to consider earlier.
Common Tax Planning Mistakes We Help Clients Avoid
- Treating the CPA as the only tax professional. CPAs are essential — they prepare the return and offer real expertise. But CPAs are typically backward-looking and transactional; proactive multi-year planning rarely happens without a financial planner driving it.
- Missing the gap-year Roth conversion window. Once Social Security and RMDs start, conversion math gets harder. Many families look back and realize the window of opportunity passed without anyone flagging it.
- Realizing large capital gains in high-income years — or, less obviously, in IRMAA threshold years. We help time gains intentionally.
- Donating cash when appreciated securities would have been more tax-efficient. A simple change in what you give can produce meaningfully better outcomes for both you and the charity.
- Beneficiary designations that defeat tax planning. Leaving retirement accounts to a non-spouse beneficiary without thought can accelerate taxable distributions in ways that better planning would have avoided.
- Forgetting that state tax planning exists. Moves, state-specific deductions, residency planning around state estate taxes — all can be material and all are commonly missed.
A Note on Realistic Expectations
Proactive tax planning produces meaningful long-term savings, but it is not magic. We’re not going to make a six-figure tax bill disappear with a clever maneuver. What we will do is shave thousands off this year’s bill where opportunities exist, prevent the larger mistakes that quietly cost families much more, and structure the next decade of decisions to be as tax-efficient as honestly possible — within the law, fully documented, and coordinated with your CPA.
Frequently Asked Questions
Are you tax preparers?
No. We are not CPAs and we do not prepare tax returns. We are financial planners who integrate proactive tax strategy into every recommendation, and we work directly with your CPA to make sure the planning shows up correctly on your return.
What is the difference between tax preparation and tax planning?
Tax preparation is backward-looking — it reports last year’s results on this year’s return. Tax planning is forward-looking — it changes this year’s (and future years’) results by making proactive decisions about Roth conversions, withdrawal order, capital gains realization, charitable giving, and the timing of major events.
When is a Roth conversion a good idea?
Roth conversions are most powerful when your current tax bracket is meaningfully lower than the bracket you expect in retirement. The “gap years” between retirement and the start of Social Security and RMDs are often the sweet spot. We model the math for your specific situation rather than relying on rules of thumb.
Can you reduce my taxes this year?
Sometimes, depending on what tools are still available before year-end. The largest wins, however, are usually multi-year strategies that compound over time. We are honest about the difference between modest one-time savings and meaningful lifetime savings.
What is IRMAA and why does it matter?
IRMAA is the Income-Related Monthly Adjustment Amount — an additional Medicare premium surcharge that kicks in when your income (from two years prior) exceeds certain thresholds. It can quietly add several hundred dollars per month to your Medicare premiums. Roth conversions and large capital gains can trigger it; planning around it is one of the quieter wins in retirement.
Do you work with my CPA?
Yes, and gladly. The best outcomes come from advisors and CPAs working together rather than in parallel. If you don’t have a CPA, we can introduce you to professionals we trust.
Ready to Bring Tax Planning Into Your Financial Life?
If your current advisor doesn’t talk about taxes proactively, you’re likely leaving meaningful value on the table. Request a complimentary consultation and we’ll walk through where the opportunities are in your specific situation.
