Tax Strategies
Select a Category
Posted on March 25, 2024 by Dan Pascone
Tax Deductions vs Tax Credits for High Earners: What You Need to Know
TL;DR Answer Box Tax credits vs tax deductions comes down to what they reduce. Credits reduce your tax bill directly, while deductions reduce taxable income and only save you a percentage based on your marginal tax rate. High earners often have fewer credits available due to phaseouts, but may still unlock meaningful credits with the […]
Posted on March 19, 2024 by Dan Pascone
Case Study: The Alternative Minimum Tax (AMT) and Equity Compensation (ISOs & RSUs)
TL;DR Answer Box ISOs vs RSUs taxes can produce very different after-tax outcomes even when the headline “grant value” is the same. RSUs are typically taxed as ordinary income when they vest, while ISOs may avoid ordinary income tax if you meet qualifying disposition rules, but they can trigger Alternative Minimum Tax (AMT) when you […]
Posted on March 19, 2024 by Dan Pascone
What is the Alternative Minimum Tax (AMT) and What You Need to Know in 2024
TL;DR Answer Box Alternative Minimum Tax (AMT) is a parallel tax calculation that can apply when certain deductions and “preference items” reduce your regular tax too far. Many high-earning tech employees run into AMT because of Incentive Stock Options (ISOs), large capital gains, and state and local tax deductions that do not behave the same […]
Posted on March 13, 2024 by Dan Pascone
Tax Implications of Equity Compensation in Tech: Navigating ISOs and RSUs
TL;DR Answer Box ISO vs RSU taxes comes down to timing, cash needs, and risk. ISOs can create powerful long-term capital gains outcomes, but they may trigger Alternative Minimum Tax (AMT) and require out-of-pocket cash to exercise. RSUs are simpler, but they are taxed as ordinary income at vesting and can create a withholding gap […]
Posted on March 4, 2024 by Dan Pascone
What are Capital Gains?
TL;DR Answer Box Capital gains tax planning comes down to two levers you can actually control: your cost basis and your holding period. Tax loss harvesting can reduce taxes today, but it can also reset cost basis in a way that increases future capital gains taxes, so it should be used intentionally, not automatically. High […]
Posted on March 4, 2024 by Dan Pascone
Harvesting Tax Losses to Beat Capital Gains
TL;DR Answer Box Tax loss harvesting is the strategy of selling investments at a loss in a taxable account to offset capital gains and potentially reduce taxes. For high earners, the biggest value is usually offsetting realized gains, not the $3,000 ordinary income deduction. The strategy works best when you avoid wash sales, keep your […]
Posted on February 27, 2024 by Dan Pascone
How to grow your wealth, not your tax bill
TL;DR Answer Box Reduce taxes for high earners is less about finding a magic deduction and more about controlling when you recognize income and where your dollars compound. Two strategies that may move the needle are Roth conversions (pay tax intentionally now for tax-free income later) and a properly designed life insurance retirement plan (LIRP) […]