Shakespeare Wealth Management

Planning for Life

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Tax Planning Services

Is your tax liability as low as possible?

For some, taxes are the single largest recurring expense incurred over their lifetime. Yet, because many don’t understand the importance of tax planning, they end up taking a reactive approach to their taxes. For higher income earners, this can be disastrous. A proactive approach must be taken to reduce tax liability.

Postpone & Avoid Taxes

An effective tax planning strategy does just that; it harnesses a proactive approach to reduce, postpone, and even avoid taxes, making it a critical part of the overall financial planning process.

By garnering a comprehensive understanding of your current and future incomes—and working collaboratively with your tax professional—our team will formulate a strategy that will help you protect the capital and assets you’ve worked so hard to build, and in turn, allow you to save and invest more.

The Shakespeare Difference

We pride ourselves in developing the best tax planning solutions for each of our clients. We do this by:

  • Understanding and taking full advantage of beneficial tax-law provisions
  • Uncovering tax deductions and tax credits
  • Harnessing all applicable breaks available under the Internal Revenue Code
  • But most importantly, we get to know and understand you and your unique situation. We’ve found that the only way to provide the highest level of advice is to get to know our clients on a one-on-one basis. We start with a detailed checklist that provides a comprehensive look at your financials.

Tax Planning Strategies and Tactics We Specialize In

We offer comprehensive tax planning for high-income individuals and families ($1,000,000+ in investable assets) in the Milwaukee area. Our services include:

  • Maximizing retirement plans
  • Planning charitable contributions
  • Income planning
  • Tax bracket maximization
  • Business ownership
  • Roth conversion strategies
  • Bunching tax deductions
  • Pre-tax savings accounts
  • Tax credits
  • College savings plans (529 plans)
  • Traditional IRAs
  • Roth IRAs
  • Home ownership
  • HSAs
  • Avoiding tax cliffs
  • Long-term care deductions
  • Long-term care premiums
  • Family planning
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Services

  • Retirement Planning
  • Tax Planning
  • Investment Management
  • Women and Wealth
  • Selling a Business
  • Death Of A Loved One
  • Legacy Planning
  • Career Change
  • College Planning
  • Insurance Preserve & Protect
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Tax Planning FAQ

Is tax planning a zero sum gain? Expand

With proper tax planning, we can lower the amount of taxes you pay over your lifetime, leaving more assets for you to save, spend, give away, or leave to your family when you’re gone. Tax planning is not a once/year activity but something that should be done on an ongoing basis.

Doesn’t my accountant catch all of the tax planning opportunities? Expand

Working with an accountant is important; but most of their time is spent producing an accurate tax return. Your accountant may not be aware of critical components of your financial plan that can impact future tax planning, including future income sources (wages, bonuses, deferred compensation payouts, required minimum distributions, Social Security income, Roth conversions, etc.), future capital gain harvesting, charitable gifting, mortgage refinances, etc. Working with a financial planner who understands every component of your financial plan and collaborates well with your CPA will help lower your lifetime taxes.

How do required minimum distributions (RMDs) that begin at age 70½ impact my taxes? Expand

RMDs coming from your IRAs and 401k/403b accounts can have a significant impact on your tax liability. They not only add to your income, but may increase the extent to which your Social Security benefits are taxable. RMDs may increase the amount of your Medicare premiums, move you into a higher tax bracket, increase the amount capital gains are taxed, and reduce the amount of your allowable tax deductions.

How do we best plan for RMDs to minimize their tax impact? Expand

Planning for RMDs well before age 70½ can create a meaningful reduction in lifetime taxes.  Beginning withdrawals or partial Roth IRA conversions between your retirement and age 70½ (accounting for other current and future income sources), can reduce the tax impact withdrawals have in future years.  In addition, structuring deductions around these income sources can also be of benefit.

Is my Social Security income subject to taxes? Expand

Social Security income is subject to tax.  There are several components that will impact the taxation of Social Security income, including the amount of each spouse’s benefit, your other income sources, and available deductions.  Each person’s situation is different. An in-depth analysis is required to determine when you should begin taking Social Security and how your taxes will be impacted.

Will my tax bracket drop in retirement? Expand

Most of us move into a lower tax bracket in retirement, but not all.  For those who are in a lower bracket in retirement, you may not stay in that same low bracket after all of your income sources, including Social Security, pensions, RMDs, investment and capital gain income, begin.  Careful planning is required to manage your way into lower brackets throughout retirement, and to minimize your lifetime taxes.

Is it possible to sell a stock and pay a 0% capital gain tax? Expand

It’s a little known fact that people in the 15% tax bracket (or lower) pay 0% tax on capital gains.  Many of us with significant assets can manage our way into the 15% bracket by delaying Social Security, pensions, and IRA withdrawals, and properly structuring our exemptions and deductions.  This is a valuable component of the tax code that should be maximized.

Are life insurance proceeds taxable? Expand

A: Life insurance proceeds are not taxable. However, after these assets are invested, they can add to your investment income and capital gain tax liability.

How can I maximize charitable gifts to lower my taxes, especially during high income years? Expand

Charitable contributions are a valuable tax deduction that lower your tax liability. The higher your income, the more valuable a charitable deduction is.  If you are in a high income tax year (and will likely be followed by low tax years), you are able to accelerate future charitable gifts into high tax years to maximize the tax deductibility of the gift and allow you to give to charities in future years at your discretion.  The tool to facilitate this process is a Donor Advised Fund (DAF).

I have high taxes this year. What can I do? Expand

There are several strategies to deal with high tax years.  First, be sure to maximize pre-tax deferrals into 401k/403b accounts.  This should include your spouse if they are working.  Next, you’ll want to accelerate deductions into the high tax year.  You are able to double up on property taxes (pay current year taxes by January 31 and next year taxes by December 31st), accelerate charitable gifts from future years into the current year using a Donor Advised Fund, and pre-pay state income taxes.  Collaborating with a CPA is critical to minimize your overall tax liability.

What are the major tax planning issues in retirement? Expand

Structuring your income sources, such as Social Security, pensions, required minimum distributions (RMDs), and capital gain/loss harvesting is critical to minimizing tax liability. The amount of your income can directly impact the extent your Social Security benefit is taxable, the tax bracket you fall into, your capital gains tax rate, the amount of your Medicare premium, whether you’ll pay the Net Investment Income Tax (NII), the exclusion of certain deductions, whether you’ll be subject to the Alternative Minimum Tax (AMT), and more.  Understanding these issues and planning properly can lower your lifetime taxes.

Can I claim an adult child or even a parent as a dependent? Expand

If you provide more than 50% of a family member's support, it is possible to list them as a dependent on your tax return.  Additional considerations and income levels need to be met for this to occur.

Should I do a Roth conversion? Expand

When you convert assets from a 401k, 403b or IRA to a Roth IRA you pay income taxes on the pre-tax portion that is converted.  It may make sense to do a conversion if you will be in a higher tax bracket in the future.  Making partial Roth conversions, to the extent you can maximize a low tax bracket, can be beneficial to your overall retirement plan and lower your lifetime taxes.

Tax Planning Videos

01:17
Importance of Rebalancing - Shakespeare Wealth Management Vlog
December 12, 2016
0:47
Investment Strategy to Minimize Taxes - Shakespeare Wealth Management Vlog
December 12, 2016
0:51
How to Save on Taxes - Shakespeare Wealth Management Vlog
December 13, 2016
1/4
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By PoseLab
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Shakespeare Wealth Management, Inc.®

N22 W27847 Edgewater Dr.
Pewaukee, WI 53072
262-814-1600

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