Tax Optimization

The costliest mistake: hedging inflation before checking the tax bill The costliest mistake I’m seeing right now: hedging inflation the loud way, gold here, broad commodities there, then getting clipped on April 15th. If tariffs pop and price levels grind higher (and, yes, tariff chatter is louder this year), a 7% pre-tax “hedge” that nets 4% after taxes isn’t a hedge; it’s a headache. The leak isn’t performance. It’s after-tax performance. Quick reality check, because the tax code isn’t shy about this stuff. Under current U.S. federal rules (2025): Most commodity funds that hold futures are taxed under Section 1256’s…

What tax pros wish everyone knew about card rewards Here’s the thing almost everyone misses about card rewards: for tax purposes, most of what you earn from swiping is treated like a discount, not income. That’s not a quirky loophole, it’s a long-standing IRS view. IRS Announcement 2002-18 says rewards earned by spending are purchase price adjustments (rebates), which means not taxable. If your 2% cash back knocks $20 off what you effectively paid for groceries, the IRS treats it like… you paid $20 less for groceries. Boring, but super helpful. Where people get tripped up, myself included years ago…

Wall Street’s not-so-secret retirement tax edge isn’t a hot stock tip, it’s timing. The biggest retirement wins usually come from how you sequence income across accounts and years, not from squeezing an extra 50 bps out of a dividend ETF. Sounds boring until you realize the difference between paying 0%, 15%, or 22% on the next dollar can be a five-figure swing over a decade. And right now, Q4 2025, timing matters because the calendar is doing half the work for you or against you. Here’s the plain-English setup. 2025 is the last full year before many individual tax cuts…

Old-school tax rules vs. how we plan now I still hear this at kitchen tables and across conference rooms: “I can’t take that bonus, it’ll kick me into the next bracket.” That old bracket cliff myth refuses to die. It sounds logical, like there’s a trapdoor at each bracket line, but it’s not how the code works. Only the next dollars are taxed at the higher rate. Your prior dollars keep their lower rates. That one sentence saves a lot of stress, and sometimes a lot of bad decisions. So what are we doing differently now? We plan by marginal…

Old-school CPA or app-plus-you? The 2025 tax reality It’s Q4, you’re juggling open enrollment choices, year-end RSU vests, maybe a bonus, maybe a side gig that went from “beer money” to real money. And, yeah, 2025 has felt trickier. Not because the code exploded overnight, but because your life probably did. More households are mixing W-2 salaries with equity comp, rentals, and the occasional crypto trade. The tools are better, the edge cases are messier. That combo is exactly where people get stuck. What’s actually happening right now: companies keep leaning into RSUs and mobile work, while individuals keep adding…

What pros do before a sabbatical (and why it saves real money) You don’t plan a sabbatical like a vacation. You plan it like a mini-M&A deal. Timelines, tax models, and sequencing. Why? Because the cheapest sabbatical is the one that lands in the right tax year, with the right income showing up in the right months. I’ve spent 20+ years helping clients time exits, bonuses, and equity. The folks who map it like a transaction save real money. Not theoretical, actual, after-tax dollars. What will you take away here? A simple playbook: 1) run a mock return for this…

Old-school rebalancing vs the 2025 tax-aware playbook Old-school rebalancing says you sell what got too big and buy what’s fallen behind. Clean. Mechanical. And it worked fine when gains were modest and cash paid nothing. But at, or near, new highs, after years of compounding, that blunt sell button can hand the IRS the biggest slice of your alpha. That’s the part that stings. Here’s why the classic playbook hurts more after a multi‑year run: embedded gains get large. Selling a $100,000 position with a 40% unrealized gain means realizing $40,000. At the top federal long‑term rate of 20% plus…

Wait, Social Security can be taxed like that? Yep. Here’s the curveball: many retirees pay federal income tax on their Social Security because Congress set very low income thresholds in 1983 and 1993 and never indexed them for inflation. Not once. So even average retirees, who were never the original target, get pulled into the tax net in 2025. That’s not a political statement, just math from decades of inflation doing what it does. The rules, in plain English: up to 50% of your benefits can be taxable once your “provisional income” tops $25,000 (single) or $32,000 (married) under the…