Fresh in Finance

New Trends. Smarter Money.

Blog

Smart Tax Planning: Practical Strategies to Lower Your Taxes and Grow After-Tax Wealth

Smart tax planning keeps more of your income working for you instead of for taxes.
Whether you’re an employee, small-business owner, investor, or retiree, a handful of practical strategies can lower current tax bills and position you for sustained after-tax growth.

Maximize tax-advantaged accounts
Make full use of accounts that offer tax deferral or tax-free growth.

Contributing to retirement plans, health savings accounts (HSAs), and flexible spending accounts reduces taxable income today while growing savings efficiently. HSAs are especially powerful because contributions, growth, and qualified withdrawals are all tax-preferred—an often-overlooked triple tax benefit.

If you run a small business, consider retirement plans designed for business owners to create larger retirement contributions and reduce taxable income.

Manage investment taxes intentionally
Tax-efficient investing matters as much as investment returns. Hold assets for the long term to qualify for preferential long-term capital gains treatment. Use tax-loss harvesting to offset gains and reduce taxable income—this means selling losing positions to realize losses, then replacing exposure with similar assets while avoiding wash sale rules. Consider tax-managed funds, municipal bonds for taxable accounts, and index funds that generate lower turnover and fewer taxable events.

Use Roth conversions strategically

Converting pre-tax retirement savings to a Roth account can pay off if you expect higher taxes later or want to reduce required minimum distributions during retirement.

Partial conversions spread over several years can prevent pushing you into a higher tax bracket. Coordinate conversions with low-income years, dips in market value, or other timing opportunities.

Bunch deductions and use charitable strategies
When itemized deductions fall close to the standard deduction, bunching can increase tax benefit. Time deductible expenses—medical procedures, state tax payments, and charitable gifts—so larger amounts fall into one year. Donor-advised funds let you claim an immediate deduction while distributing donations over multiple years. Charitable remainder trusts and donor-advised strategies can provide income, tax deductions, and support long-term giving goals.

Take advantage of available credits and incentives
Tax credits directly reduce tax liability and often offer higher value than deductions. Common credits range from family-related and education credits to energy and clean-vehicle incentives.

Homeowners and property owners should investigate credits and incentives for energy-efficient upgrades, which can reduce both tax bills and utility costs.

Optimize business structure and compensation
For small businesses, choosing the right entity type and deciding between salary and distributions can affect taxable income and self-employment taxes. Implementing retirement plans, accelerating deductible expenses, or deferring income are classic levers. Work with a tax professional to balance tax optimization with legal compliance and long-term business goals.

Mind state and local tax planning
State residency, where you work, and where you own property can materially affect your total tax bill. If you travel or split time across states, document days carefully and review domicile rules. Some people legitimately reduce state tax exposure by aligning residence and business activities with more favorable jurisdictions.

Keep records, review with a pro, and plan annually
Meticulous recordkeeping simplifies claiming deductions, credits, and business expenses.

Tax law and personal circumstances change, so review planning annually or when life events occur—marriage, home purchase, job change, or inheritance. A knowledgeable tax advisor can translate these strategies into a plan tailored to your situation and help avoid pitfalls such as wash-sale traps or unintended tax bracket jumps.

Thoughtful planning converts ordinary tax preparation into a strategic tool for building and protecting wealth.

Start with a checklist of accounts, credits, and timing opportunities, then prioritize moves that align with your cash flow and financial goals.

February 14, 2026
Traditional IRA Guide: How It Works, Tax Benefits, Rollovers & Smart Strategies

Traditional IRA: How it Works and Smart Ways to Use One
A traditional IRA is a tax-advantaged retirement account designed to help individuals save and grow assets for retirement. Contributions may be tax-deductible, earnings grow tax-deferred, and withdrawals are taxed as ordinary income. Understanding the rules, flexibility, and planning opportunities can help you make the most of a traditional IRA.

Contributions and deductibility
Contributions to a traditional IRA are subject to annual limits set by the IRS and may be fully or partially tax-deductible depending on your modified adjusted gross income and whether you (or your spouse) participate in an employer retirement plan. Because limits and income phase-outs are adjusted periodically, confirm current contribution and deduction thresholds before you contribute.

You can contribute from earned income; the ability to contribute is not tied to investment performance.

Tax treatment and withdrawals
Earnings inside a traditional IRA accumulate tax-deferred, which can accelerate long-term growth when paired with disciplined investing. Distributions from a traditional IRA are taxed as ordinary income when taken. If you take money before the IRS’s specified age for penalty-free distributions, you may owe ordinary income tax plus an additional early-withdrawal penalty unless you qualify for an exception (such as certain medical costs, first-time home purchases under specific circumstances, or qualified higher-education expenses). Required minimum distributions (RMDs) begin once you reach the age designated by the IRS for required distributions; failing to take required amounts can trigger substantial penalties.

Rollovers, transfers, and conversions
Traditional IRAs are commonly used for rollovers from employer plans. Trustee-to-trustee transfers (direct rollovers) avoid tax withholding and are the simplest way to preserve tax-advantaged status. Indirect rollovers that route funds through you generally must be completed within a 60-day window to avoid taxation and penalties, and withholding rules can complicate matters.

Converting a traditional IRA to a Roth IRA is an option if you want tax-free qualified withdrawals later and to avoid future RMDs. Conversions are taxable events—amounts converted are included in taxable income for the year of conversion—but they can be a strategic move when your taxable income is relatively low or when you expect higher tax rates in the future.

Beneficiaries and estate planning
Naming beneficiaries for your traditional IRA is a simple but crucial step.

Beneficiary designations usually supersede wills, so review and update them after major life events.

Inherited IRA rules vary depending on the beneficiary’s relationship to the original owner and recent regulatory changes; proper planning can minimize taxes and distribution pressure for heirs.

Record-keeping and tax reporting
Keep accurate records of deductible and nondeductible contributions; the IRS requires reporting of nondeductible contributions using the appropriate tax form so future withdrawals are taxed correctly.

Distributions are reported on Form 1099-R; contributions and rollovers may be reported on Form 5498 by the custodian. Accurate paperwork saves time and avoids costly mistakes at tax time.

Practical tips
– Check current IRS contribution and deduction limits before contributing.

– Prioritize naming and reviewing beneficiaries.
– Use trustee-to-trustee rollovers to avoid withholding and potential pitfalls.
– Consider Roth conversions in years when your taxable income is lower.
– Coordinate IRA strategy with employer-sponsored plans and other tax-advantaged accounts.
– Consult a tax professional for complex situations like large rollovers, conversions, or estate planning.

A traditional IRA remains a flexible core of many retirement plans. By staying informed about contribution rules, withdrawal penalties, and rollover options—and by documenting contributions carefully—you can use a traditional IRA to reduce current taxes, grow investments tax-deferred, and shape a tax-aware retirement income strategy. Check current IRS guidance and consult a qualified tax or financial advisor to align IRA choices with your personal financial goals.

February 14, 2026
Traditional IRA Guide: Tax-Deferred Growth, Contribution Rules, RMDs & Conversion Strategies

Traditional IRAs remain a core option for tax-deferred retirement savings, offering flexibility for individuals who want to reduce taxable income now and grow investments without immediate tax drag. Understanding the key rules and strategic uses can help savers make choices that align with long-term goals.
What a Traditional IRA does
A Traditional IRA lets contributions grow tax-deferred. Depending on your income and whether you (or a spouse) participate in a workplace retirement plan, contributions may be tax-deductible. Withdrawals in retirement are taxed as ordinary income. If contributions are nondeductible, keeping accurate records is essential to avoid double taxation on distributions.

Contribution and catch-up rules
Annual contribution limits apply, and many savers who are older may be eligible to make additional catch-up contributions. Eligibility also depends on earned income or a working spouse’s income in married-filing-jointly situations. If you’re considering maximizing contributions, coordinate IRA deposits with employer-sponsored retirement plans to optimize tax benefits.

Early withdrawals and exceptions
Withdrawals prior to the designated age threshold are typically subject to ordinary income tax plus an early withdrawal penalty.

There are several exceptions to the penalty—examples include certain first-home purchases, qualified education expenses, disability, unreimbursed medical expenses that exceed a percentage of adjusted gross income, and a few other narrowly defined situations.

Because both taxation and penalty rules can be complex, evaluate alternatives before tapping an IRA early.

Required minimum distributions (RMDs)
Traditional IRAs are subject to required minimum distributions once account owners reach the age set by law.

Missing or underpaying an RMD can lead to substantial penalties, so planning withdrawals or converting funds ahead of that age is important. One tax-efficient strategy for charitable philanthropists is making qualified charitable distributions (QCDs) directly from an IRA to an eligible charity; under the right circumstances, a QCD can satisfy RMD requirements while excluding the distribution from taxable income.

Conversions and rollovers
Converting a Traditional IRA to a Roth IRA triggers income tax on pre-tax amounts converted, but future qualified Roth withdrawals can be tax-free and may eliminate future RMDs.

Partial conversions spread across years can manage tax brackets and reduce long-term tax exposure. Rollovers from employer plans into an IRA should be handled as direct transfers to avoid inadvertent taxable events.

Recordkeeping and tax forms
Maintain careful records of nondeductible contributions and conversions. Accurate tracking prevents unnecessary taxation on distributions later and simplifies filing the required tax forms that report IRA activity. If you’ve made nondeductible contributions, make sure the appropriate form is filed to document basis.

Beneficiary considerations
Naming beneficiaries and keeping designations up to date is a critical part of IRA planning.

Distribution rules for inherited IRAs vary by beneficiary type; recent legislative changes altered how some beneficiaries must take distributions. Estate planning should incorporate potential tax consequences for heirs and consider whether Roth conversions could leave a more tax-efficient legacy.

Practical next steps
Review IRA contributions annually, coordinate strategy with employer plans, and consult a tax or financial advisor to tailor conversion, withdrawal, and beneficiary strategies to personal tax circumstances.

Small adjustments now—careful recordkeeping, timely beneficiary updates, and coordinated distribution planning—can yield meaningful tax and legacy benefits down the road.

February 13, 2026
How to Build Realistic Passive Income: Proven Strategies, Automation & a 30-Day Plan

Passive income isn’t magic — it’s the result of systems, upfront work, and smart reinvestment.
Approached realistically, passive income can supplement wages, accelerate financial goals, or eventually replace active work.

Here’s a practical guide to reliable, evergreen passive income options and how to set them up for long-term success.

What passive income really looks like
– It often requires significant initial effort or capital.
– Returns vary widely by strategy and risk level.
– Automation and systems are decisive: the more you automate, the more passive it becomes.
– Ongoing maintenance is common, even for “set-and-forget” streams.

Proven passive income strategies
– Dividend investing: Buy diversified dividend-paying ETFs or stocks to receive regular payouts. Focus on quality income producers and reinvest dividends to compound growth.
– Real estate (indirect and direct): Rental properties generate rent, but require management. Consider indirect options like real estate investment trusts (REITs) or real estate crowdfunding to get exposure with less day-to-day maintenance.
– Digital products: Ebooks, templates, printable planners, and stock photos sell repeatedly with little ongoing cost. Validate demand before launching and use marketplaces and your own site to diversify distribution.
– Online courses and memberships: Build a course once, sell it repeatedly. Memberships provide recurring revenue but need periodic content updates and community management.
– Affiliate marketing and content sites: Create helpful content that attracts organic traffic, then monetize with affiliate links or display ads.

SEO and content quality are key to scaling.
– Licensing and royalties: License music, photos, or software for recurring fees.

Useful for creators who can scale the same asset across many buyers.
– Automated investing and robo-advisors: For hands-off investors, automated portfolios can deliver passive market exposure and reinvest dividends automatically.
– Peer-to-peer lending and debt instruments: These can offer attractive yields but carry credit risk.

Diversify across loans and platforms.

How to start (practical steps)
1. Choose 1–2 strategies that fit your skills, capital, and time. Don’t spread yourself too thin.
2. Validate demand or return expectations before heavy investment. Small tests reduce costly mistakes.
3. Build the asset: write the course, acquire the property, create content, or fund an investment account.
4. Automate processes: payment processing, email campaigns, content scheduling, and property management can be automated or delegated.
5. Reinvest early returns to compound growth and boost long-term yield.
6. Measure performance and iterate. If a channel underperforms, pivot or scale back.

Automation and outsourcing
– Use scheduling and payment tools to reduce manual work.
– Outsource repetitive tasks like customer support, bookkeeping, or property management to free your time.
– For content and courses, hire help for editing, design, and SEO to accelerate growth.

Risk management and taxes
– Diversify across asset classes to reduce concentrated risk.
– Maintain emergency liquidity; avoid over-leveraging.
– Track income sources carefully for tax reporting and consult a qualified advisor to optimize structure and deductions.

Realistic expectations
Passive income builds slowly at first. Initial months or quarters typically require more time and attention than later stages. Success comes from consistent testing, high-quality assets, and reinvestment rather than chasing get-rich-quick shortcuts.

Actionable next move
Select one idea from the list, create a 30-day plan with three specific tasks, and commit to measuring outcomes. Small, consistent steps compound into meaningful passive revenue streams over time.

February 12, 2026
How to Use a 529 Plan: Tax Benefits, Flexible Uses, and Smart Strategies to Maximize Education Savings

A 529 account remains one of the most flexible, tax-efficient ways to save for education. Designed to encourage long-term saving, these college savings plans offer tax-deferred growth and tax-free withdrawals for qualified education expenses, but they also work well for a range of modern education goals when used thoughtfully.
What 529s cover
– Qualified expenses typically include tuition and fees at eligible colleges and universities, room and board for students enrolled at least half-time, required books and supplies, and certain technology expenses required for coursework.

Many plans also allow use for trade schools, apprenticeships, and other approved post-secondary programs.
– Some federal rules and state interpretations have broadened allowable uses in recent policy changes.

Specific eligible expenses and limits can vary by state and by plan, so always check plan documents before withdrawing funds.

Tax advantages and state incentives
– Contributions grow tax-deferred, and withdrawals used for qualified education expenses are federal tax-free. Many states offer state income tax deductions or credits for residents who contribute to their home plan, though those benefits differ widely.
– Be aware that non-qualified withdrawals generally incur income taxes on earnings plus a federal penalty. Some states may recapture previous tax benefits on non-qualified distributions.

Planning and strategy tips
– Start early and let compounding work in your favor. Even modest, regular contributions can accumulate meaningfully over time.

– Use age-based investment options if you prefer a hands-off strategy. These shift toward more conservative investments as the beneficiary approaches college age.

If you have specific risk preferences, static or custom portfolios allow more control.
– Leverage the gift-tax five-year election if you want to front-load a 529. This lets a single large contribution be treated as spread over several years for gift-tax purposes, which can be useful for grandparents or others who want to accelerate savings.
– Coordinate with financial aid planning. A 529 owned by a parent is generally assessed more favorably in federal financial aid calculations than an account owned by the student.

Ownership and withdrawal timing can affect expected family contribution.

Handling leftover balances
– If the beneficiary doesn’t use all funds, you have flexible options: change the beneficiary to another family member, keep the account for future education needs (including graduate school), or withdraw the money (subject to taxes and penalties on earnings for non-qualified uses).
– Some plans allow rollovers to other family members’ 529s without penalty. A transfer to the beneficiary’s qualified education loan repayment or to other accounts may be possible under certain rules—read plan details and consult a tax advisor to confirm eligibility.

Picking a plan
– You don’t have to use your home state’s plan, though state tax benefits sometimes make local plans attractive.

Compare fees, investment options, state tax incentives, and plan performance before deciding.
– Watch fees and underlying fund expenses. Lower-cost plans can add up to significantly better outcomes over many years.

Stay informed
Plan rules and tax guidance evolve. Before making major contributions, withdrawals, or beneficiary changes, review the plan’s official documents and consult a tax or financial advisor to ensure your strategy matches current rules and your family’s goals.

A 529 can be a powerful tool for paying for education at multiple levels. With careful planning—choosing the right plan, managing investments, and understanding tax implications—you can maximize the benefit and keep options flexible as education plans change.

February 10, 2026
Practical Tax Strategies to Keep More of Your Income and Build Long-Term Wealth

Smart tax strategies help you keep more of what you earn and support long-term wealth building.
Whether you’re an employee, small-business owner, or investor, a few thoughtful moves can reduce taxable income, defer taxes, and improve after-tax returns. Here are practical, evergreen approaches to consider.

Maximize retirement contributions
Contributing to employer-sponsored plans and individual retirement accounts is one of the simplest ways to lower taxable income while saving for the future.

Pre-tax contributions reduce current taxable income and grow tax-deferred, while Roth-style accounts offer tax-free withdrawals later—making tax diversification a key principle. If you have self-employed income, look into SEP IRAs, SIMPLE IRAs, or a Solo 401(k) to increase contribution capacity and lower net taxable business income.

Use health savings and education accounts
Health Savings Accounts (HSAs) deliver a rare triple tax benefit: pretax contributions, tax-free growth, and tax-free withdrawals for qualified medical expenses. If you’re eligible, maxing an HSA can be a long-term tax-efficient strategy for healthcare costs. Education-focused tax-advantaged accounts, such as 529 plans, provide tax-free growth for qualified education expenses and can be a tool for estate and gift planning.

Harvest losses, manage capital gains
Tax-loss harvesting means selling investments with losses to offset realized gains, potentially lowering taxable income.

Carefully coordinate harvesting with your investment strategy to avoid impairing long-term objectives.

Managing the timing of gains—spreading sales over periods when taxable income is lower or holding investments longer to benefit from favorable long-term capital treatment—can also reduce tax bills. Be mindful of wash-sale rules when repurchasing similar securities.

Consider Roth conversions strategically
Converting pretax retirement assets to Roth accounts can make sense if you expect higher tax rates or larger taxable income in the future. Partial conversions spread the tax hit across multiple reporting periods and can be paired with years of lower taxable income to control tax bracket impact. Consult a tax advisor to model conversion scenarios and estimate the short-term tax cost versus long-term benefit.

Optimize charitable giving
Charitable giving can be tax-efficient when structured smartly. Bunching contributions—grouping several years’ worth of donations into one tax year—can maximize itemized deductions when standard deduction thresholds are near your giving level. Donor-advised funds allow immediate deductions with flexibility on when to distribute grants. For highly appreciated assets, gifting the asset directly to charity avoids capital gains taxes while securing a deduction.

Business owners: capture legitimate deductions
Small-business owners and independent contractors should regularly review deductible expenses. Common opportunities include retirement plan contributions, health insurance premiums, business-related travel and equipment, and qualified business income deductions for certain pass-through activities. Entity structure matters: choosing between sole proprietorship, LLC, S-corporation, or C-corporation affects how income and deductions are taxed. Run scenarios with a tax professional before making structural changes.

Invest tax-efficiently
Tax-efficient investment choices reduce taxable distributions. Low-turnover index funds and tax-managed funds tend to generate fewer taxable capital gains than active strategies.

Municipal bonds can offer tax-exempt income, especially attractive for higher-income taxpayers in high-tax states. Rebalance within tax-advantaged accounts to avoid realizing taxable gains.

Practical steps to implement
– Review withholding and estimated tax payments to avoid penalties.
– Keep detailed records of donations, medical expenses, and business receipts.
– Work with a CPA or enrolled agent for complex situations like conversions or entity changes.
– Use tax-aware financial planning models to project outcomes under different scenarios.
Tax rules and thresholds vary by jurisdiction and can change, so review strategies with a qualified tax professional before acting. Sound planning today can meaningfully improve after-tax returns and financial flexibility tomorrow.

February 9, 2026
How 529 Plans Work: Tax Advantages, College-Savings Strategies & Common Pitfalls

A 529 plan is one of the most flexible, tax-advantaged tools for saving toward education. Designed to help families pay for college and other qualified education costs, these accounts combine tax-free growth with a range of investment options and estate-planning benefits, making them a common centerpiece of long-term education funding.
What a 529 covers
Qualified distributions are federal income tax-free when used for eligible education expenses.

That typically includes tuition, fees, books, supplies and equipment required for enrollment, and a portion of room and board for students enrolled at least half time.

Recent law also allows 529 funds to pay for certain apprenticeship program expenses and to be used—up to a lifetime limit—for student loan repayment for the beneficiary and their siblings. Additionally, many plans permit using up to a set annual amount toward K–12 tuition at private schools.

Types of 529 plans
There are two basic types:
– College savings plans: Work like investment accounts. Contributions are invested in mutual funds or similar portfolios and grow tax-deferred.
– Prepaid tuition plans: Allow pre-purchasing tuition credits at participating colleges at today’s rates, locking in future costs at eligible institutions.

State plans, fees and flexibility
Each state administers its own plans and may offer state tax deductions or credits for resident contributors.

That creates three decisions: whether to choose your home-state plan for the state tax break, to use another state’s plan for superior investment options or lower fees, or to split accounts across plans. Shopping for low fees, clear investment choices, and solid customer service can improve long-term outcomes.

Beneficiary changes, rollovers and gifting
One major advantage is flexibility in changing the beneficiary. If a child receives a scholarship or doesn’t use all the funds, the account owner can name another qualified family member as beneficiary without tax consequences.

Accounts can also be rolled to another 529 plan; there are rules about frequency of rollovers, so verify plan restrictions before moving funds.

529 contributions also play well with gifting and estate planning. Contributions qualify for the federal annual gift-tax exclusion, and there’s an option to front-load multiple years of exclusions through a special election for larger lump-sum gifts.

Pitfalls and tax traps
Nonqualified withdrawals trigger income tax on the earnings portion plus a federal penalty, though exceptions exist—such as death, disability, or scholarship amounts—where the penalty may be waived while income tax still applies. Another overlooked issue is the impact on financial aid: 529s owned by parents are treated more favorably in aid formulas than accounts owned by the student, and accounts controlled by grandparents or others can affect aid differently. Planning the account owner and distribution timing can preserve eligibility.

Practical tips to get more from a 529
– Start early and automate contributions to benefit from compounding.
– Use age-based or lifecycle portfolios to shift toward conservative investments as college nears.
– Compare plans for fees, investment returns and state tax incentives.
– Coordinate 529 use with other savings and with financial aid planning.
– Keep documentation of qualified expenses and withdrawals for tax reporting.

A 529 can be a powerful tool whether saving for college, career training, or even some K–12 expenses.

Evaluate plan features carefully, align the account owner with your financial-aid goals, and consult a tax or financial advisor to match a 529 strategy to your family’s needs.

February 9, 2026
Traditional IRA Guide: Contributions, Rollovers, RMDs, Roth Conversions & Tax-Smart Withdrawal Strategies

Traditional IRAs remain a core building block for retirement planning because they combine tax-deferred growth with flexible contribution and rollover options.
Understanding how they work, when they’re most valuable, and the key rules that affect withdrawals can help you make smarter decisions about retirement savings.

What a traditional IRA does
A traditional IRA lets you contribute money that grows tax-deferred until you withdraw it in retirement. Depending on your income and whether you’re covered by a workplace retirement plan, contributions may be tax-deductible, which can lower your taxable income today. Withdrawals are taxed as ordinary income, so tax-rate management over time is an important consideration.

Who benefits most
– People seeking immediate tax deductions who expect to be in the same or a lower tax bracket in retirement.
– Workers without access to a workplace retirement plan or those who want to supplement employer plans.

– Couples using a spousal IRA to let a non-working spouse build retirement savings.

Key rules to watch
– Contribution rules and annual limits are set by the IRS and can change, so check current guidance before making contributions.
– Deductibility depends on your modified adjusted gross income and whether you (or your spouse) participate in a workplace retirement plan—phaseouts apply at higher income levels.
– Required minimum distributions (RMDs) must start under current law once you reach the RMD threshold; failing to take required amounts can trigger a substantial penalty.
– Early withdrawals before reaching the age threshold typically incur an additional tax penalty, though there are several exceptions (medical expenses, qualified education expenses, certain first-home purchases, and others).

Rollovers, conversions, and coordination with other accounts
Traditional IRAs are often used as the destination for rollovers from employer plans when changing jobs. Rollovers preserve the tax-deferred status of retirement savings, but pay close attention to direct-transfer procedures to avoid unintended taxable distributions.

A common strategy is converting traditional IRA assets to a Roth IRA. Conversions require paying income tax on pre-tax amounts converted, but future qualified withdrawals from the Roth can be tax-free. Be mindful of the pro-rata rule if you hold both pre-tax and after-tax IRA funds—this can affect the taxable portion of a conversion.

Withdrawal and distribution strategy
Managing distributions can reduce lifetime tax costs.

Consider:
– Timing withdrawals to avoid bumping into higher tax brackets.
– Using a mix of qualified Roth distributions and traditional IRA withdrawals to create tax diversification.

– Coordinating IRA withdrawals with Social Security claiming decisions and other income sources.

Beneficiaries and estate planning
Keep beneficiary designations up to date—IRAs pass outside a will and follow the named beneficiary.

Recent law changes affect how beneficiaries must take distributions, so it’s important to review beneficiary strategies and consider whether a stretch strategy is still available for your heirs.

Practical tips

– Review your IRA deductible eligibility each year, especially if your workplace coverage or income changes.
– Use trustee-to-trustee transfers for rollovers to avoid withholding and reporting complications.
– If considering Roth conversions or large distributions, run tax projections or consult a tax advisor to estimate the immediate tax bill and longer-term benefits.
– Keep records of nondeductible contributions (Form documentation) to avoid double taxation on withdrawals.

Traditional IRAs offer flexibility and tax advantages, but they come with rules that affect timing, taxation, and estate planning. Reviewing account design, contribution strategy, and distribution timing with a tax or financial professional can help align IRA decisions with broader retirement goals.

February 8, 2026
Year-Round Tax Strategies to Reduce Your Tax Bill: Roth Conversions, Loss Harvesting & Bunching

Smart tax strategies reduce liability and free up more of your income for goals like homeownership, retirement, or charitable giving. A practical approach combines year-round planning with tactical moves near tax-filing time. Below are high-impact strategies that many taxpayers can tailor to their situation.
Tax-Efficient Retirement Moves
– Max out pretax retirement accounts to lower taxable income now, and consider contributions to Roth accounts for tax-free withdrawals later. Combining pretax and Roth contributions creates flexibility to manage taxable income in retirement.
– Consider partial Roth conversions when your taxable income dips into a lower bracket. Spreading conversions over several years can avoid large tax spikes while building a tax-free bucket.
– Watch required minimum distributions (RMDs) if they apply to you; earlier planning can reduce surprises and help optimize taxable income in later years.

Harvest Losses and Gains
– Tax-loss harvesting: sell underperforming investments in taxable accounts to realize capital losses that offset gains and a portion of ordinary income.

Losses in excess of limits can carry forward to future years.
– Strategic capital gains realization: in years with lower taxable income, realize long-term gains to take advantage of lower capital gains rates. Timing matters—harvesting gains and losses together can neutralize market exposure while optimizing tax outcomes.

Bunching and Itemized Deduction Planning
– Bunch deductions into a single tax year to exceed the standard deduction threshold. Common tactics include accelerating charitable gifts, paying a year’s worth of medical expenses or property taxes in one year, and prepaying deductible expenses where allowed.
– Use donor-advised funds to bunch charitable giving: make one large donation now to claim the deduction, then distribute grants to charities over time.

Use Tax-Advantaged Accounts Fully
– Health Savings Accounts (HSAs) offer a triple tax advantage: pretax contributions, tax-free growth, and tax-free withdrawals for qualified medical expenses. Funding an HSA while eligible can be a powerful long-term strategy.
– Flexible spending accounts and 529 education plans provide tax benefits when used as intended; understand contribution limits and qualified expenses to avoid penalties.

Charitable and Estate Planning Tools
– Donor-advised funds and charitable remainder trusts can provide an immediate tax benefit while allowing long-term philanthropic goals.
– Use lifetime gifting strategies within the annual gift tax exclusion to shift assets out of a taxable estate.

For larger estates, advanced planning with trusts can manage both taxes and asset distribution.

State and Residency Considerations
– State tax rules vary widely. Transitions between states, especially those with lower or no income tax, can offer meaningful savings, but pay attention to residency rules and timing to ensure the benefits are realized.
– Consider the tax treatment of investments and retirement income at both the federal and state levels when relocating.

Practical Steps to Get Started
– Review last year’s return to spot tax-inefficient items and recurring opportunities.
– Prioritize actions that are reversible or spread over time, such as staged Roth conversions or phased charitable contributions.
– Keep clear records: document charitable donations, medical expenses, and investment transactions to substantiate deductions and losses.

Be mindful of complexities: alternative minimum tax triggers, phaseouts of deductions and credits, and changing rules for retirement accounts can affect strategy effectiveness. Working with a qualified tax professional helps adapt these strategies to your circumstances and stay compliant.

Start by identifying one or two high-impact areas—retirement account contributions, charitable bunching, or tax-loss harvesting—and build a seasonal plan that aligns with your cash flow and financial goals. Regular checkpoints throughout the year make it easier to capture opportunities and avoid last-minute scrambling.

February 8, 2026
529 Plan Benefits: How to Maximize Education Savings and Use Funds Wisely

What a 529 plan can do for your education savings — and how to use it wisely
A 529 plan is one of the most powerful tools for saving for education. These state-sponsored accounts let savings grow tax-deferred and offer federal tax-free withdrawals when used for qualified education expenses. That combination of tax efficiency and flexibility makes them central to many family savings strategies.

What counts as qualified expenses
Qualified expenses typically include college tuition, fees, books, supplies, and required equipment. Room and board usually qualify for students enrolled at least half-time, and many plans allow expenses like a required computer, software, and internet access.

Recent federal rules also permit using up to a set annual amount for K–12 tuition at private or religious schools, though not all states conform for state tax purposes — check local rules first.

Tax advantages and exceptions
Withdrawals used for qualified expenses are federal income tax-free on earnings. States frequently offer their own tax deductions or credits for contributions, but those vary widely and sometimes have residency requirements. If the beneficiary receives a scholarship or attends a U.S. military academy, you can withdraw an equivalent amount penalty-free for the earnings portion, though taxes on earnings may still apply.

New flexibility and rollovers
There’s growing flexibility around 529s. Recent legislation allows limited rollovers from 529 accounts to Roth IRAs for the same beneficiary under specified conditions. This creates an attractive fallback for funds that won’t be needed for education, though rollover amounts and eligibility rules are constrained. Rollovers to ABLE accounts and beneficiary changes to other family members remain useful options for maintaining tax advantages while adapting to changing plans.

Ownership, control, and estate planning benefits
A key advantage is that the account owner — often a parent or grandparent — retains control over the funds, including the ability to change beneficiaries to other eligible family members. Contributions are generally considered completed gifts for estate-tax purposes, and many savers use accelerated contribution elections to remove assets from their taxable estate while preserving access and flexibility.

Investment choices and fees
Plans offer a range of investment options, from age-based portfolios that become more conservative as college approaches to static, index-based options. Fees and investment quality vary significantly between plans.

Choosing low-cost, broadly diversified investments and monitoring fees can make a meaningful difference in long-term outcomes.

Consider comparing your state’s plan to other states’ plans before settling on an option.

Impact on financial aid
A 529 owned by a parent is treated favorably for federal student aid calculations, usually assessed at a smaller percentage than student income. Grandparent-owned accounts can have a different effect, sometimes reducing aid eligibility when distributions are counted as student income.

Timing withdrawals and planning ownership can minimize aid impact; coordinate with a financial aid advisor when possible.

Practical tips to get the most
– Start early and contribute regularly via automatic transfers to benefit from compounding.
– Prioritize low-cost plans with clear fee disclosures and good track records.
– Keep receipts and documentation for qualified expenses to support tax-free withdrawals.
– Review state tax rules before using funds for K–12 expenses or moving plans across states.
– Consult a tax or financial advisor before executing rollovers or complex beneficiary changes.

529 accounts combine tax advantages, ownership control, and flexible use that make them a cornerstone for education funding. With careful plan selection, attention to fees, and awareness of changing rules, a 529 can preserve more of your savings for the education goals they were intended to serve.

February 7, 2026