Okay, let’s do this.
Tax planning for high-income earners hit me like a freight train last April when I opened that IRS letter while sitting in my underwear eating cold Domino’s in a Marriott outside McCarran airport. I’m talking heart-palpitations, sweaty-palms, “I’m-moving-to-Puerto-Rico-tomorrow” levels of panic. I’d just cleared low seven figures for the first time—mostly consulting gigs and some dumb-lucky crypto—and somehow still owed more in taxes than my first house cost. Like, bro, what the actual hell? https://www.irs.gov/pub/irs-pdf/p526.pdf –
Why Tax Planning for High-Income Earners Feels Impossible When You’re “New Money”
Look, nobody hands you a manual when your W-2 suddenly turns into twelve 1099s and a K-1 that looks like Sanskrit. My accountant at the time—nice guy, zero urgency—basically shrugged and said “pay it or amend.” Cool, cool, super helpful. Meanwhile I’m Googling “can the IRS garnish OnlyFans income” at 3 a.m. because that’s where my brain went. https://www.irs.gov/pub/irs-pdf/p526.pdf –
The brutal truth? Most advice out there is for either broke college kids or billionaires with family offices. Us in the awkward 400k–3M zone get screwed because we make too much for simple deductions but not enough for the truly offshore anything without felony vibes.
The Backdoor Roth Mistake That Cost Me $18k (Don’t Be Me) Tax Planning
2023 me thought I was slick. Made too much for a regular Roth IRA, so I did the whole “backdoor” thing—contribute to traditional IRA, immediately convert to Roth. Felt like a hacker. Except I forgot about the pro-rata rule because I had a $47k rollover IRA from an old job. Boom—85% of my conversion got taxed at ordinary income rates. I literally screamed in a Target parking lot when TurboTax showed the damage.
Lesson: If you have any pre-tax IRA money anywhere, either roll it into your current 401k first or just… don’t do backdoor until you clean that up. I eventually fixed it in 2024 by rolling the old IRA into my solo 401k, but man, that sting still wakes me up some nights.
Solo 401k: The Cheat Code Nobody Talks About for Side-Hustle Millionaires
This changed everything. As a single-member LLC, I can contribute like $69k (2025 limits) as both employee and employer, plus another $10k if I’m over 50 (I’m not, I just like crying about it). Money goes in pre-tax, grows tax-deferred, and I borrow against it if I want. It’s stupidly good. https://opportunityzones.hudexchange.info/
Pro tip from my current (much better) CPA: open the solo 401k at Fidelity or Schwab by December 31st, but you have until your filing deadline to actually make the employer contribution. Saved my ass last year.
Real Estate Hacks I’m Currently Obsessed With (Yes, Even After the Crash Scare)
I bought a duplex in Nashville last year using something called cost segregation + bonus depreciation. Basically, the government lets you front-load depreciation on things like carpet and appliances. My accountant pulled out like $240k in paper losses year one on a $650k purchase. My effective tax rate dropped to like 9%. I felt like Pablo Escobar but legal.
Downside? When I eventually sell, recapture tax is gonna punch me in the throat. But that’s future-me’s problem. Current me is sipping oat-milk cortado judging people who pay full freight to Uncle Sam. Tax Planning https://opportunityzones.hudexchange.info/
The Donor-Advised Fund Trick That Feels Like Cheating Tax Planning
Bunched all my charitable giving into one year. Sold a chunk of Tesla stock that had 10x’d, dumped $100k into a DAF, got massive deduction at peak income, now I can grant it out to charities over the next decade while taking standard deduction most years. It’s gloriously broken.
Random Tax Planning for High-Income Earners Thoughts at 2 A.M.
- QSBS is real but you have to hold five years and the company has to be under $50M assets when you invest. Most “unicorn” opportunities don’t qualify anymore. Sadge.
- Opportunity zones still exist but good luck finding anything that isn’t sketchy Florida condos.
- I pay California taxes because my audience is here and remote income rules are a minefield. I hate it but I sleep better.
- Crypto wash sales don’t apply yet (as of 2025) but they’re coming. Harvest those losses while you can, kings.
Conclusion: Do Literally Anything Instead of Nothing Tax Planning
I’m still not “good” at tax planning for high-income earners. I still get anxious every March. But I went from owing $87k unexpected to getting a $12k refund this year, so… progress? https://opportunityzones.hudexchange.info/
Talk to an actual professional who works with messy creative entrepreneurs, not your uncle’s guy who does Apple employees. Open that solo 401k. Bunch those donations. Cost segregate something. Just don’t be 2023 me eating cold pizza and contemplating witness protection over taxes. Tax Planning
You got this. Or at least you’ll owe less than I did. Tax Planning
Drop your dumbest tax mistake below—I need to feel better about myself.
