End-of-Year Tax Planning Strategies for High-Income and High-Net-Worth Households
November 27, 2023
As the year concludes, high-income and high-net-worth households need to consider strategies that can help them minimize their tax liability and maximize their savings. Many of these end-of-year tax strategies revolve around assessing a taxpayer’s marginal tax bracket now versus where it will likely be. At Janiczek Wealth Management, we utilize tax projection software to help our clients make these end-of-year tax planning decisions with clarity and confidence, to minimize their lifetime tax liability while utilizing their wealth to accomplish what is most important to them. Four end-of-year tax optimization strategies are most common for our affluent client group: charitable giving, maximizing retirement plan contributions, utilizing backdoor Roth IRA contributions, and implementing Roth IRA conversions. 1. Charitable Giving Strategies: Charitable giving not only supports important causes but also provides valuable tax benefits. Our clients frequently utilize two strategies: Donor Advised Funds (DAFs) and Qualified Charitable Distributions (QCDs). Donor Advised Funds (DAFs): Donor advised funds allow you to contribute to an account and receive an immediate tax deduction, even if you decide on the end charitable recipients later. This flexibility will enable you to contribute to the DAF during a high-income year, potentially bundling multiple years’ worth of your charitable giving […]
