High earners often work hard to grow wealth, yet many leave thousands of dollars on the table every year at tax time. In this quick video, Matt D’Amico, CFP®, ChFC®, shares five powerful tax planning strategies that successful professionals frequently overlook. From maximizing retirement contributions to advanced charitable giving and real estate deductions, you’ll learn practical ways to keep more of what you earn.
If you’re making $250K+ a year, this is a must-watch.
Transcript:
Hey there and welcome back. I’m Matt D’Amico, an advisor here at Net Worth Advisors. If you’re a high earner bringing in strong income but feel like you’re handing over more than your fair share come tax time, you’re definitely not alone.
We work with a lot of successful professionals and business owners who are crushing it financially but are still missing out on some key tax savings opportunities that could be keeping more money in their pockets every single year. In this video, I’m going to break down five smart tax strategies that high-income earners often overlook, and more importantly, how you can start taking advantage of them right now. Let’s dive right in.
The first strategy is maximizing those contributions to the retirement accounts beyond the basics. You’re probably already maxing out your 401(k) or IRAs, but have you explored other options? Many high earners miss opportunities like mega backdoor Roths if your plan allows it, or if you’re a business owner, taking advantage of accounts like SEP IRAs, SIMPLE IRAs, or even defined-benefit plans. These accounts can really supercharge your tax savings beyond what those basic limits are.
The second strategy I want to touch on is strategic tax-loss harvesting. Investing is great, and we all want to pick winners, right? But when that doesn’t happen, are you making sure your losses are working for you? Tax-loss harvesting involves selling investments at a loss to offset gains or potentially ordinary income. Essentially, this is a year-round strategy to optimize your portfolio’s tax efficiency.
The next strategy I want to discuss here is leveraging what’s called donor-advised funds for charitable giving. For those of you who are charitably inclined, a donor-advised fund can be a real game changer. Essentially, it works by donating cash, appreciated stock, or other assets directly to the fund.
You receive an immediate tax deduction, you get to avoid any future gains on that appreciated stock, and you get to pick different charities over time to donate to. It’s really a powerful way to maximize your philanthropic impact and maximize your tax savings.
The fourth strategy I want to touch on here is optimizing real estate deductions. Beyond the standard mortgage interest deduction, high earners with investment properties often overlook significant tax saving strategies like depreciation, cost segregation, and strategically structured real estate activities. The takeaway here is a powerful tax shield when it’s managed correctly.
Lastly, I want to touch on proactive quarterly tax planning. With multiple income streams that business owners often face, and income that constantly fluctuates, underpaying those estimated taxes can lead to penalties, or they potentially forget about things like stock option exercises. But working with a professional can help avoid these unnecessary tax penalties and ensure that everything’s working the way it should be. And those are the five powerful tax planning strategies that could help you save on taxes every single year.
When you’re ready to work with a financial planner, we’ll be ready to talk. Give us a call at 724-746-3585 or email schedule at networthadvisorsllc.com.
