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What is Tax Planning?

Tax planning is not defined (or regulated) quite as clearly as tax advice. Tax planning can be defined as the analysis of a specific situation or longer term financial plan with the goal of reducing someone’s tax liability. 

Some choose to define this as ensuring a taxpayer’s tax liability in a given year is as low as possible. However, taking a longer view may adjust that slightly to ensuring that a taxpayer’s lifetime tax liability is as low as possible. As any advisor (or accountant) knows, it may be advantageous to pay some taxes in one year – even if you don’t need to – if that means paying significantly less in future years. 

So…What is the Difference Between Tax Advice and Tax Planning?

In short, tax advice is more concrete and definitive than tax planning. Tax advice says, “You should do this or that” and, as a result, carries with it more of the liability issue of being wrong, because you “told” someone to do something. Tax planning is more suggestive of possibilities and not necessarily as definitive. It is more conceptual, with the general tone of conversations being “What might this look like? What if we did this? Etc.”

Tax advice is offered by accountants, not advisors, but we can work with your CPA to validate our planning so we can help you implement your tax savings!

Roth IRA Conversion

Roth IRA Conversion

Will a Roth Conversion increase my net worth over time? What are the affects on all my other income sources or Medicare Part B?

Net Unrealized Appreciation (NUA)

Net Unrealized Appreciation (NUA)

Highly appreciated stock in your 401k? You may have option to elect NUA for more favorable tax treatment of company stock at long term capital gain rates.

Charitable Planning

Charitable Planning

Explore best ways to give to charity using QCD's, stacking years or using appreciated securities.

Checklist to Success!

We will need your full 1040 tax return with all pages as a PDF to load up into the system. We also comb through the return using our checklist to find the opportunities to save money on taxes!!! See summary of analysis below. We can also do multi-scenario analysis over multiple tax years to see the effects of different strategies you can use to save $$$.

Sample Analysis