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- 💸 #0019- Tax Secrets of the Affluent
💸 #0019- Tax Secrets of the Affluent
Discover the tax planning calendar used by the wealthy to save thousands. Learn why March is the critical month for reducing your 2025 tax bill, not just filing 2024 returns.
Shrewd Investor
March 04, 2025 • Read in 9 minutes
Tax Secrets of the Affluent
The Calendar Trick That Saved Me $437,000 In Taxes
Surprising lesson from a billionaire's tax advisor.
"The wealthy don't pay taxes based on who their CPA is," he told me. "They pay taxes based on when they talk to them."
That conversation changed everything for me.
While most people scramble to gather receipts in March and April, the wealthy have a completely different tax calendar. One that starts right now—when everyone else is focused on last year.
Last year, I implemented this calendar shift with my business. The result? $437,000 less in taxes. Completely legal. Fully documented. And shockingly simple.
In today's newsletter, I'm breaking down the exact mindset shift that separates those who overpay the IRS and those who pay their fair share—and nothing more.
The most expensive mistake you're making has nothing to do with your deductions or your business structure.
It's about timing.
This week we dive into when you need to upgrade your tax advisors and when to connect with them to maximize your savings!
Talk soon,
Josh
In today’s issue:
Weekly Wisdom - Popular aphorisms and quotes…
Market Minute - Trumps trade war ratchets up…
Deep Dive - Tax season is here, is your CPA up to the task?
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WISDOM
“If you want to change your tax, you have to change your facts.”
SHREWD INSIGHTS
What the Wealthy Are Reading…
📈 MARKET INTEL
The current market is mirroring the last trade war’s trajectory—with eerily similar ups and downs. If history rhymes, this chart suggests key opportunities amid the volatility.
💰 SMART MONEY PLAYBOOK
Trade tensions are rattling global markets, but savvy investors are pivoting to sectors less exposed to international strife. Domestic utilities and regional banks, with their local focus and stable demand, offer a safe harbor amid the chaos.
🪖 TAX WARFARE
Proper tax document preparation is crucial for ensuring an accurate and efficient filing process. Organizing your financial records before or during tax season helps you avoid missing deductions, credits, or necessary forms, which could lead to overpaying or delaying your refund.
🤖 POWER TOOLS
Artificial Intelligence is transforming financial modeling by automating complex tasks like revenue forecasting, expense analysis, and cash flow projections. These AI-driven tools not only enhance accuracy but also free up investors to focus on strategic decision-making, offering a competitive edge in today's fast-paced financial landscape.
💎 THE GOOD LIFE
Time is the ultimate luxury, and elite concierge services are the gatekeepers to a life where every desire is met with precision and discretion. From securing impossible reservations to orchestrating bespoke experiences, these services offer unparalleled convenience, allowing the ultra-wealthy to focus on what truly matters.
DEEP DIVE
Hey there Shrewd Investor,
Let me share a story I saw just last week...
A tech professional landed a dream job with a massive pay package—base salary plus RSUs (that's "Restricted Stock Units" for the non-corporate folks). When they joined, the company stock exploded in value. Their potential income skyrocketed from $700,000 to $1.5 million in one year.
Their reaction? Pure stress.
"I haven't done RSUs in many years. I recognize this is a good problem to have, but I'm still stressed about it and don't want to get in trouble. What can I do to prepare?"
Sound familiar? Maybe your numbers aren't that high (yet), but the anxiety is the same.
The Big Lie About Tax Help
Here's the cold, hard truth no one tells you:
Not all tax professionals are created equal—and the one you've been using might be holding you back.
When Your Tax Situation Outgrows Your Tax Pro
The IRS itself says: "There are different kinds of tax professionals, and a taxpayer's needs will help determine which kind of preparer is best for them."
Translation: That tax preparer who handled your simple returns when you made $80,000 a year might be completely out of their depth now that you have RSUs, stock options, or business income.
The Warning Signs You Need to Upgrade Your Tax Help
They don't ask about your future plans - A good tax pro plans in August, not April
They don't have experience with your specific situation - RSUs, business structures, and investment strategies need specialized knowledge
They're not available year-round - The IRS specifically warns: "Look for a preparer who's available year-round. If questions come up about a tax return, taxpayers may need to contact the preparer after the filing season is over."
They promise bigger refunds than competitors - The IRS flags this as a major red flag
The Tax Professional Hierarchy You Need to Know
The IRS maintains a "Directory of Federal Tax Return Preparers with Credentials and Select Qualifications" because not all preparers have the same skills:
Basic Tax Preparers - They have a PTIN (Preparer Tax Identification Number) but may have minimal training
Enrolled Agents - IRS-licensed specialists focused entirely on taxes
CPAs - State-licensed accountants with broader financial knowledge
Tax Attorneys (with Masters in Tax) - The elite tier for complex situations and tax planning
The Million-Dollar Mistake
Remember our stressed tech professional with the RSUs? Their situation highlights the #1 mistake wealthy people make:
Thinking about taxes AFTER the money comes in.
By the time those RSUs vest, it's too late to plan. The same goes for:
Business structure decisions
Investment timing
Retirement account strategies
Deduction planning
Giving to causes
Gifting to family or friends
Changing your investment strategy
The Truth About Who Controls Your Tax Bill
The IRS warns: "Taxpayers are ultimately legally responsible for all the information on their income tax return, regardless of who prepares it."
This means YOU are responsible—not your tax preparer.
When to Fire Your Current Tax Pro
It's time for an upgrade when:
Your income jumps significantly (like from $100K to $300K+)
You start receiving equity compensation (RSUs, stock options)
You start a business or the business grows quickly
You're facing a major liquidity event (selling a business, inheritance)
Your tax pro hasn't called YOU to plan before year-end
The #1 Thing Smart People Are Doing Right Now
While everyone else is scrambling to finish their 2024 tax returns, wealthy people are already planning for 2025.
Here's the brutal truth: If you're only thinking about taxes in March or April, you've already lost thousands (or perhaps millions in this group) of dollars.
March is too late for last year's taxes—but it's the PERFECT time to start planning this year's strategy.
While you have your financial documents in front of you for your 2024 return, use this opportunity to:
Book a 2025 tax planning session with a qualified professional
Evaluate if your current tax preparer is truly qualified for your financial situation
Set up the systems and structures needed to minimize this year's tax burden
The IRS recommends checking their directory, reviewing the preparer's history with the Better Business Bureau, and understanding their credentials.
Your wealth deserves better guidance.
P.S. We've created a comprehensive "2024 Year-End Tax Playbook" that walks you through exactly what you could be doing right now to save on next year's taxes. Get it free at: https://newsletter.shrewdinvestor.com/p/2024-year-end-tax-playbook
If you’d like us to break down your portfolio or ask a question, submit yours here: https://shrewdinvestor.com/roastme
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The content provided in this newsletter is for informational purposes only and should not be considered as specific advice for any specific individual. The information is prepared by knowledgeable individuals and is not written by certified tax professionals or investment advisors. For personalized advice tailored to your unique financial situation, consult with a qualified tax professional, financial advisor, or attorney.
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