by Maryann Keith, CFP®, CIMA®, CDFA®
Tax season is upon us, and at the top of most to-do lists is a reminder to call your tax advisor. Tax planning and financial planning go hand in hand. Not only is it important to reach out to your tax professional this time of year, it’s also wise to speak with your financial advisor.
From early February to mid-April, tax preparers are among the busiest people on earth – often working 15+ hour days. Their primary goal during this time is to file your return on time and minimize your taxes. Because they’re so busy, it can be incredibly helpful to consult your financial professional first. This ensures you maximize every minute of your tax appointment. Here are the top three questions Beden Wealth suggests asking your financial advisor before tax time:
- How will upcoming or recent changes in tax law impact my financial plan? Tax law changes can be complex. It’s important to ask not only your accountant, but your financial planner about how this can affect your long-term strategy. For example, in 2026, catch-up contributions in 401(k) plans for high earners ages 50 and older must go to a Roth 401(k) under certain circumstances – a first under current regulations. This means that you may need to review your budget because you will pay taxes on your catch-up contribution. Switching gears, for people age 65 and older, a financial advisor can give you a good idea based on your budget and distribution strategy whether you have a chance of qualifying for the enhanced senior deduction of $6000 per eligible individual. They can advise if it’s worth making changes to your financial plan and talking to your accountant to take advantage of this new deduction.
- What should I proactively ask my accountant about to lower my tax liability? Anyone can go online and search for recommendations on what to ask about at their tax appointment, but a financial advisor can help you narrow down what to ask based on your personalized goals and objectives. For example, if you became self-employed during the past year, it’s important to ask your tax preparer to calculate how much you can defer to a retirement savings vehicle like a SEP IRA or Individual 401(k) plan. Additionally, inquire about further tax-efficient strategies that should be considered before filing.
- Will you participate in a meeting with my accountant and I? At Beden Wealth, we believe collaboration among your trusted professionals is essential. We routinely meet with our clients’ tax professionals and have found that together, we are able to plan more efficiently for the future. These meetings often cover topics like Roth conversions, distribution planning, stock options, and business exit strategies. Roth conversions are a frequently discussed topic and when you have the involvement of both your financial and tax advisors, you’ll be able to plan for the bigger picture. For example, when completing a Roth conversion, you have to consider more than just your tax bracket – how does it affect your capital gains tax rates, Medicare premiums, eligibility for the enhanced senior standard deduction and other tax credits? And how do you balance this with your financial plan to ensure you are on the right path to live life as you envisioned? Team work can really make a difference in crafting a cohesive strategy.
Not sure where to start this tax season? Call your financial planner first to prepare for your tax appointment. At Beden Wealth, we’re here to guide you through this busy time and welcome your call.
* Neither MML Investors Services, LLC nor any of its subsidiaries, employees or representatives are authorized to give legal or tax advice. Consult your own personal attorney legal or tax counsel for advice on specific legal and tax matters.
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