At The Money: Tax Day Special
Masters in Business Podcast Recap
Published:
Duration: 16 min
Guests: Bill Artsaronian
Summary
Barry Ritholtz and Bill Artsaronian discuss strategies for reducing 2025 taxes, focusing on tax planning as a crucial part of financial advice. Key takeaways include the importance of proactive tax planning and understanding the impact of recent tax legislation on deductions and contributions.
What Happened
Bill Artsaronian emphasizes that tax advice is financial advice and explains how taxes touch every part of a financial plan. He stresses the importance of proactive tax planning throughout the year, not just at year-end, and considers tax implications for future generations.
Artsaronian identifies common misunderstandings about tax deferral versus tax avoidance. He explains that while strategies like 401k contributions and accelerated depreciation can defer taxes, they will eventually result in a tax bill. Timing of capital gains is another area where investors often make mistakes.
For high-earning professionals, Artsaronian suggests focusing on charitable giving, equity compensation timing, and maximizing qualified business income deductions. He highlights the importance of understanding limitations on tax benefits based on wages and ensuring retirement contributions are maximized.
Artsaronian explains changes in tax-advantaged accounts, such as the forced Roth contributions for catch-up contributions starting in 2026. He advises clients to consider all contributions and look for opportunities like the mega backdoor Roth option.
Tax loss harvesting should be an ongoing activity, not just a year-end task, according to Artsaronian. He suggests using direct indexing for regular portfolio review to pick up losses throughout the year, rather than waiting until December.
On the topic of state and local tax (SALT) deductions, Artsaronian notes that the new limit is $40,000, but it phases out for incomes over $500,000. He explains that this change requires tactical planning for those who can benefit from it.
Artsaronian also discusses how recent tax legislation impacts charitable giving, advising clients to consider bunching donations or using donor-advised funds. He notes that planning should take into account upcoming changes in deduction limits and AGI floors.
To conclude, Artsaronian highlights the importance of maximizing all available tax opportunities and planning for both current and future tax implications. He encourages listeners to take advantage of the remaining months in the year to make strategic tax moves.
Key Insights
- Bill Artsaronian stresses that tax planning is integral to financial advice, as taxes are often the largest expense for investors. Proactive planning throughout the year and considering generational tax implications are crucial.
- Misunderstandings about tax deferral versus tax avoidance are common. Artsaronian explains that while deferrals like 401k contributions delay taxes, the bill will eventually come due, highlighting the importance of timing in capital gains realization.
- Changes to tax-advantaged accounts include forced Roth catch-up contributions starting in 2026. Artsaronian advises exploring options like the mega backdoor Roth for additional tax-free growth opportunities.
- Artsaronian explains that the new SALT deduction limit is $40,000, but it phases out at higher incomes. This change requires tactical planning to maximize benefits, especially for those in high-tax states.