Tax planning isn’t just about filing your tax return. It’s about assessing and managing your lifetime tax burden and identifying planning opportunities along the way.
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Austin, our tax planning partners historically advise us to never pay a tax before its time. It is always better to pay taxes later. Is that always true?
Of course not. The key is to assess and manage your lifetime tax burden. And I totally understand the desire to focus solely on deferring taxes without regard for the future. However, in my opinion, there’s a difference between doing a tax return and tax planning. And through that planning, we can help clients identify opportunities to prepay their taxes now versus what they might pay at a later date.
Some examples might be Roth conversions, charitable bunching, or even with the recent tax law legislative changes, we can look at how they’re currently deferring into their workplace retirement plans. So the key is to look at your lifetime tax burden, not just what you owe from last year.
We think so.