Meredith Moore is the Founder & CEO of Artisan Financial Strategies LLC. She is fascinated by the interplay between gender, money and power.
Tax season often feels like a sprint to the finish line—gathering receipts, maximizing deductions and hoping for the best outcome before April 15. But for high-income earners, executives and business owners, tax planning isn’t just a once-a-year event. It’s a year-round strategy, and most people leave serious money on the table by not taking advantage of tax-saving opportunities.
If your annual income is in the mid-six-to-seven figures, the tax code is not designed entirely in your favor, but that doesn’t mean you’re out of options. Here are four powerful tax strategies that high earners often overlook until it’s too late.
1. Maximizing Retirement Contributions Beyond The Basics
Most professionals contribute to their 401(k) or SEP IRA, but few leverage all the tax-deferral opportunities available.
In 2025, the 401(k) employee deferral limit is $23,500, with an additional $7,500 catch-up contribution allowed for those age 50 or older.
Mega Backdoor Roth 401(k): If your employer allows it, you can contribute up to $70,000 in total (or $77,500 if age 50 or older) in combined employee and employer contributions, including after-tax dollars, to your 401(k) in 2025—then convert the after-tax portion to a Roth for tax-free growth.
Backdoor Roth IRAs: If you exceed income limits for direct Roth IRA contributions, you can convert after-tax dollars into a Roth for long-term, tax-free withdrawals.
It matters if you expect to be in a lower tax bracket in retirement; deferring taxes now can significantly lower your lifetime tax bill.
2. The Overlooked Wealth-Building Power Of An HSA
Think health savings accounts (HSAs) are just for medical bills? Think again. For high earners, an HSA can function as a stealth retirement account with triple tax benefits:
• Tax-deductible contributions (reducing taxable income)
• Tax-free investment growth (if left untouched)
• Tax-free withdrawals (for qualified medical expenses—now or decades later)
The IRS defines the following contribution limits for HSAs (as of 2025):
• $4,300 for individuals
• $8,550 for families
• $1,000 catch-up if 55-plus
Pro tip: Once you hit 65, your HSA can be used for non-medical expenses without penalties, similar to an IRA. You’ll only owe income tax on non-medical withdrawals.
3. Smarter Charitable Giving: More Than Just Writing A Check
Many high earners donate to charity, but are they doing it the tax-smart way?
Bunching Charitable Contributions: Instead of donating small amounts each year, bundle multiple years into one tax year to exceed the standard deduction and maximize tax benefits.
Gifting Appreciated Stock (Instead of Cash): If you sell stock and donate the cash, you pay capital gains tax first. Instead, donating appreciated stock directly allows you to:
• Avoid capital gains tax (saving 15% to 20% or more on gains)
• Get a full deduction for the stock’s fair market value
Making Qualified Charitable Distributions (QCDs) As A Retiree: If you’re 73-plus and subject to required minimum distributions (RMDs), you can donate up to $105,000 directly from your IRA to charity—tax-free.
Why it matters: Strategic charitable giving can lower your taxable income while maximizing your philanthropic impact.
4. Business Owners: Your Tax Structure Might Be Costing You Thousands
For business owners, entity structure can make or break tax efficiency. If you haven’t reevaluated your corporate structure in the last five years, you could be:
• Overpaying self-employment taxes (if still taxed as an LLC instead of an S corporation)
• Missing out on the 20% Qualified Business Income Deduction (for pass-through entities)
• Overlooking Section 1202, which offers a 100% tax exemption on capital gains for qualifying C corporation stock sales
Case study: A business owner operating as a sole proprietor was paying $50,000 per year in self-employment taxes. By restructuring as an S corporation, taking a reasonable salary with distributions, they saved $30,000 annually.
Thinking of selling? Your entity structure matters. Advanced tax strategies—like a pre-exit estate freeze or gifting shares to heirs—can reduce tax liability by millions with proper planning.
Tax Planning: A Year-Round Strategy, Not A Deadline-Driven Panic
Many high-income earners assume they’re maximizing tax efficiency, but last-minute deductions aren’t enough.
Here’s what you can do before April 15 each year: Review your retirement contribution strategy (including Roth conversion opportunities). Assess whether you’re using HSAs and charitable giving to their full advantage. Evaluate your business entity structure, if applicable. Plan now for tax-saving moves that can carry into next year.
Tax strategy isn’t just about what you owe this year—it’s about what you keep over a lifetime. Small shifts in strategy can mean hundreds of thousands (or even millions) in long-term tax savings.
Want to optimize your taxes? Talk to your financial team now to ensure you’re not leaving money on the table. The best tax savings happen before the deadline, not after.
The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.
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