We have an alliance partnership with Premier Tax Consulting for your Tax Preparation needs. Does it matter who does your tax preparation? We think yes.
We have an alliance partnership with Paragon Tax Advisory Services for your Tax Planning needs. What is tax planning? Tax planning is when a client plans withdrawals based upon current and future taxation.
TAX PREP VS TAX PLANNING
There is a difference between preparing your taxes and planning around your taxes. When you have both working together…there is a powerful connection that will bring you more value than you have realized.
BASIC WITHDRAWAL SEQUENCE
Do you pull from your retirement accounts, taxable accounts, tax-deferred or tax-exempt investments first? And when? We’ll help you understand the basic retirement withdrawal sequence of where you pull money from, and what is best from a tax-smart perspective. The simplest withdrawal strategy is to take assets in the following order:
– Required Minimum Distributions (RMDs)
– Taxable Accounts
– Tax-deferred retirement accounts (Traditional IRA, 401(k), 403(b), or 457
– Tax-exempt retirement accounts (Roth IRA or Roth 401(k)
AVOID HAVING WITHDRAWALS BUMP YOU INTO A HIGHER TAX BRACKET
The final step is to monitor your taxes and the source of withdrawals so that you can understand the effect of the withdrawals on your tax rate and avoid a move into a higher tax bracket. To help you save money in taxes, we will use a strategy called ‘Bracket Bumping’ so that you become Tax-Smart with your tax return.