11 Tax Moves High Earners Should Make After Filing | Dan Pascone | Ep #58

If you just filed and felt a gut punch, either the bill was bigger than expected or the refund felt smaller than it should have, you're not alone. Dan hears a version of this every year from executives and business leaders who are doing everything right on paper but have no proactive plan around their taxes. And the frustrating part is that the window to actually do something about it closes fast: the motivation fades, the numbers go cold, and most people just quietly repeat the same mistakes next year.

Most high earners treat their tax return as a filing requirement rather than what it actually is: a breakdown of the financial decisions you made in the last twelve months. It shows your real effective tax rate, your equity comp exposure, whether your withholding was aligned, and where gains or losses landed. What's done is done, but that same document tells you exactly what to fix for this year and beyond.

Dan is candid about why this matters even for W-2 earners, who have the least tax optionality of anyone. "The tax code is built for first and foremost business owners, and then secondarily investors," he says. Own a business, and you have the most optionality. Invest through even a taxable brokerage account, and you still have real options. A W-2 earner is lowest on the totem pole, but everyone, even a high-income W-2 earner, can do proper tax planning for the future. Dan speaks from experience here: as a high-earning executive himself before founding Tailored Wealth, he met with his CPA once a year, and it was always a backward-looking conversation.

Dan suggests three moves to make immediately, while the numbers are still fresh, not next month.

1. Review your effective tax rate. Find the line on your return showing what percentage of your total income actually went to taxes, then compare it to last year. Did it go up? If so, was it higher income, more equity events, a different bonus structure, fewer deductions, or simply no proactive planning?
2. Check your withholding for this year. This is the biggest gap Dan sees with executives who have lumpy income: commissions, bonuses, and equity events. Those triggers typically withhold around 22 percent, well below what a high earner's real marginal rate usually is. Look at your full income picture, base, bonus, equity events, investment income, and any change to a spouse's income, and adjust accordingly; the IRS Tax Withholding Estimator is a useful gut-check. A large refund isn't a win, it's an interest-free loan to the IRS; owing a lot risks forcing you to tap accounts that weren't meant to be touched.
3. Pull Schedule D and review your capital gains. Every gain and loss you realized last year lives on this page. Was the tax impact intentional, or did gains stack on top of ordinary income and push you into a higher bracket? Direct and custom indexing is worth understanding here: a taxable account built from individual securities rather than a fund gives you the ability to harvest losses tactically in a way a plain index fund or ETF often can't.

The next four moves are less urgent, but they belong in your regular planning cadence.

4. Review your retirement contribution opportunities. Did you max out every vehicle available to you? Dan cautions against defaulting to a Roth-only strategy purely for tax diversification if it means leaving a real deduction on the table; where a plan allows it, the mega backdoor Roth lets you max your traditional 401(k) and then route additional after-tax dollars into a third bucket that converts to Roth, giving you the best of both. Our full breakdown of the mega backdoor Roth walks through the exact contribution limits and plan requirements.
5. Reassess your investment account structure, known as asset location. Tax-inefficient assets belong in tax-optimized accounts (401(k), IRA, Roth), while more tax-efficient holdings, like low-cost ETFs, fit better in taxable accounts. We cover the full asset location playbook here, and this video walks through a real case study showing the dollar impact of getting it wrong.
6. Review your charitable giving timing and structure. The biggest lever most W-2 earners control is timing. Instead of writing a check, consider gifting appreciated securities: if you're planning to give $20,000 and you're holding a stock with a $1,000 cost basis and $10,000 of embedded capital gains, giving the security directly still gets you the deduction, but neither you nor the charity owes tax on that gain. A donor-advised fund lets you take the deduction in a high-income year and decide later which organizations to support.
7. Review your equity compensation events. RSUs, stock options, and employee stock purchase plans are usually the biggest lever in a corporate comp package, and also the most commonly mismanaged. Look at what triggered tax last year: did a vest land in a year when your ordinary income was already high? There are two separate problems to solve, the tax strategy specific to your award type, and the concentration risk of holding too much of one company's stock, which for some executives runs 40 to 50 percent of their entire net worth.

This one feels administrative, but Dan has seen the consequences of getting it wrong, and they're significant. Ask yourself what changed in the past year: a marriage, a divorce, a new child, a move, a job change, a large asset shift, a new account or rollover. Beneficiary designations on retirement accounts, life insurance, and brokerage accounts override your will, even if you have one properly drafted and signed. Our deeper look at what actually controls where your money goes covers exactly why this gap catches so many executives off guard.

The last three moves are about building a system so you're never back in the same spot next April.

9. Schedule a mid-year check-in. Book it now, while the motivation from filing is still fresh. June or July is the right window, before it's too late to make meaningful adjustments.
10. Build a simple income forecast for the year. You don't need a massive spreadsheet: map your base salary, when equity vests land and how much, your bonus structure, and any side income or spousal income changes. When you can see the full year coming, you can make decisions ahead of it instead of reacting to it.
11. Make one commitment for next year's return. Pick one thing: better coordination across investments, optimized timing of equity events, more strategic charitable giving. Whatever it is, bring it to whoever helps you plan and build it into your review cadence.

Most people treat this like a once-a-year task because that's how the tax return arrives, once a year. What most people miss is that an abnormal income year, on the high end or the low end, is actually a planning opportunity, not just a number to get through. A year with lower income because of a job change or unemployment can be the right window for a Roth conversion or a larger distribution from an inherited IRA while your rate is temporarily lower. A year with unusually high income is exactly when charitable bunching or a donor-advised fund contribution does the most good. The return doesn't just tell you what happened, it tells you what kind of year you're in and what that year is good for.

Take an executive we'll call Priya: 46 years old, a base salary of $280,000, with a $60,000 bonus and an RSU vest that landed the same month. Her return showed an effective tax rate three points higher than the year before, and she owed the IRS $14,000 she hadn't budgeted for. When she pulled her paystubs, the bonus and the vest had both been withheld at a standard 22 percent, well under her real marginal rate.

Working through the checklist, she adjusted her withholding for the rest of the year to account for the timing of her next vest, started an after-tax mega backdoor Roth contribution through her plan, and set a rule to sell down company stock, which had grown to 38 percent of her net worth, on a quarterly schedule regardless of price. She also moved her giving from a mid-December cash gift to a donor-advised fund contribution of appreciated stock, made in the same year as her bonus. The following April, her return showed a two-point drop in her effective rate and no surprise balance due.

This episode is for corporate executives and business leaders who just filed their taxes, whether the number surprised you or just didn't feel right, and who want to use that return as a planning tool instead of filing it away until next year. If your income includes bonuses, commissions, or equity compensation, or you've never actually shared your tax return with whoever helps you plan, this is built for you.

If your tax return surprised you this year, or you've never actually sat down with someone to plan around it, a second set of eyes can help you find the gaps before next April. Book a Free Wealth Strategy Call with Tailored Wealth and we'll talk through your income, equity, and taxes together.