Working to reduce taxes is an essential piece of your overall financial plan. Tax laws can be confusing, and little mistakes lead to larger tax issues. Each year millions of people overpay in taxes without even knowing it. Our tax advisory team pays critical attention to taxes during every step of your financial planning process to minimize tax problems.

Tax Diversification

There are several ways to develop a tax efficient investment strategy in order to create more flexibility in managing your taxes now and in the future. Your money can be held in three different types of accounts and they are all taxed differently. Our tax advisors will diversify your assets into these three accounts in order to create the highest after-tax net income.

Roth Conversion Strategies

Most individuals have the majority of their retirement assets in tax-deferred accounts that are subject to ordinary income tax. Our tax preparation consultants recommend strategies to shift assets from the tax-deferred accounts to tax free accounts using Roth conversions so that you can have more control over taxes in retirement. With a Roth conversion, you simply “prepay” the taxes on the amount you convert, which allows you to capture all future growth and income as tax free. Our tax consultants and CPA’s use meticulous strategies to project how much money you should convert to a Roth IRA over a period of time in order to control your tax bracket long-term and get the most value from your investments.

Tax-Loss Harvesting

Tax-Loss Harvesting is a strategy our financial planners use to turn money lost from an investment into a profitable opportunity. Our tax planners use the capital losses that inevitably occur to reduce your tax bill. You don’t truly have a gain or a loss on any asset until you sell it. When the asset is sold we are able to use that capital loss to offset your capital gains and income tax. The investment can then be replaced, or harvested, with a similar investment in order to maintain proper balance and diversification within your portfolio.

Additional Comprehensive Strategies

Our financial advisors utilize comprehensive tax preparation strategies when creating financial plans to ensure that our investment strategies are tax-efficient and follow Internal Revenue Service (IRS) guidelines. Some additional strategies include asset location, donor-advised funds, defined contribution and defined benefit plans, tax-efficient portfolio rebalancing, charitable gifting and strategies for reducing taxes on real estate transactions. With careful tax planning, our retiree clients can pay a 15% tax rate even if they’re living a 25% bracket lifestyle.