Most people breathe a sigh of relief after April 15 and stop thinking about taxes for another year.
That’s a mistake. Especially if you’ve spent the last 30 or 40 years building real wealth.
After 40 years in this business, what I know is the families who generally pay less in taxes aren’t luckier than everyone else. They tend to plan better. That means the best time to start planning for next year’s tax bill is right now, while the numbers are fresh and the year still has runway.
Your Tax Picture Changes Dramatically in Retirement
Business owners and high earners often assume taxes get simpler in retirement. They don’t. In many cases, they get more complicated. You’re managing multiple income streams like Social Security, IRA distributions, investment income, and possibly a business sale. The interaction between them can push you into brackets you didn’t expect.
One of the patterns I see consistently: people who were disciplined savers spend decades stuffing money into traditional IRAs and 401(k)s, then reach retirement and realize they have a serious required minimum distribution (RMD) problem. Under current rules, RMDs begin at age 73, and the IRS doesn’t care what the market is doing when you’re forced to take that withdrawal. Miss the deadline, and the penalty may be up to 25% of the amount you should have taken.
The Window Between Now and Age 73 Is Worth Something
For high-income families who have retired or are approaching retirement, there’s often a meaningful window between the time you stop working and the time RMDs kick in. This is one of the more strategic periods in a person’s financial life.
During this window, income may be lower than it was during peak earning years and lower than it will be once RMDs begin stacking on top of Social Security. That combination can create an opportunity. Specifically, it may make sense to consider partial Roth conversions during lower-income years. This means taking money from a pre-tax account, paying tax on it now at a potentially lower rate, and moving it into a Roth IRA, where it can grow tax-free.
The One Big Beautiful Bill Act, passed in July 2025, extended the existing the Tax Cut and Jobs Act (TCJA) tax brackets. That means the seven-bracket structure — 10%, 12%, 22%, 24%, 32%, 35%, and 37% — is now stable and adjusted for inflation annually. It also introduced a new senior deduction of $6,000 per qualifying taxpayer age 65 and older, though that benefit begins phasing out at $150,000 of modified adjusted gross income for married couples filing jointly. Understanding how these changes interact with your specific situation takes analysis, not guesswork.
Tax laws change, and individual situations vary significantly. These observations are educational. Consult with a qualified tax professional regarding your specific circumstances.
Three Strategies Worth Reviewing Now
Review your withdrawal sequencing. The order in which you draw from different account types — taxable, tax-deferred, and tax-free — can have a meaningful impact on your annual tax liability. Many people default to spending down taxable accounts first without considering how that affects their future RMD exposure or their Medicare premiums.
Check your bracket headroom. For 2026, the 24% bracket for married couples filing jointly extends up to $394,600 in taxable income. Before year-end, it may be worth asking whether there’s room to do additional Roth conversion work, recognize capital gains at a lower rate, or make other moves while you’re still in a favorable bracket. This is the kind of planning that requires running the numbers on your actual situation.
Revisit your charitable giving strategy. If you’re 70½ or older and charitably inclined, a Qualified Charitable Distribution (QCD) from your IRA allows you to transfer up to $108,000 directly to a qualified charity in 2025 without the distribution counting as taxable income. For families who don’t need their full RMD for living expenses and are already giving to causes they care about, this strategy is worth understanding.
The Problem With Waiting
Every year, I sit down with families who did their own tax planning for years or relied on someone who only looked at last year’s return. The issue isn’t that they made bad decisions, but that they made no decision. They let the default happen.
Effective tax planning for retirement doesn’t start in April. It starts in May, when you still have the full year in front of you. Families who take a proactive, coordinated approach to planning aren’t doing anything exotic. They’re paying attention, they’re working with people who understand how all the pieces connect, and they’re not waiting until December to act.
If you’d like to explore how these strategies might apply to your situation, we’re happy to talk.
TL;DR: The window right after tax season is one of the best times to plan for the following year. For high-income retirees and business owners, strategies like Roth conversions, withdrawal sequencing, and QCDs may help manage tax liability, but the opportunity narrows over time. Don’t wait until December to start the conversation.
