You’re Paying More in Taxes Than You Think

Quick quiz:
What’s your biggest annual expense?

If you said your mortgage, your kid’s school, or even your health insurance — you’re not wrong… but you’re not right either.

For most high-income earners and business owners, taxes are the single largest expense they’ll pay year after year.

• Federal income tax

• State income tax

• Capital gains tax

• Payroll tax

• Sales tax

• Property tax

It’s death by a thousand deductions — and most people don’t even realize it’s happening.

And here’s the worst part:

You’re probably paying more than you have to.

Case Study: The $280,000 “Oops”

Let’s talk about Jon.

Jon sold his company for just under $5 million. It was the result of years of hard work and smart decisions. He did the hard part — he built something valuable and exited successfully.

But here’s where things went sideways:
He didn’t talk to a financial advisor or tax strategist until after the sale.

No pre-sale planning. No structure. No forward-looking strategy.

The result? A massive capital gains bill — and an estimated $280,000 in overpaid taxes.

Why?

Because he missed key opportunities that could have changed the outcome completely:

• He didn’t use a donor-advised fund

• He didn’t take advantage of Qualified Small Business Stock (QSBS)

• He didn’t defer income using a custom retirement plan

• He didn’t offset gains with losses through tax-loss harvesting

Jon wasn’t careless. He just didn’t know.
And no one was in his corner telling him what to do — or when to do it.

Taxes Aren’t a One-Time Problem

Most people think tax planning is what happens in April when your CPA tells you how much you owe.

That’s tax preparation, not tax strategy.

By the time your return is filed, the opportunity to save money is long gone.

True tax planning is proactive, not reactive.
It happens in October, November, December — not April 14th.

At Compound Advisory, tax strategy is built into everything we do. It’s not a once-a-year conversation. It’s ongoing. Integrated. Aligned with your investments, your withdrawals, your giving, your estate plan — all of it.

Because if your advisor isn’t thinking about taxes, then they’re not thinking about your bottom line.

Smart Tax Moves Most People Miss

Here are a few of the strategies that many people — even high-net-worth individuals — either don’t use or don’t use effectively:

1. Tax-Loss Harvesting

You sell investments that are down to offset gains elsewhere.

Most investors ignore this until December (if at all), but we do it year-round. We use it as part of a harvesting strategy to smooth returns and reduce tax drag.

2. Asset Location

This is all about putting the right investments in the right accounts.

For example:

• Tax-inefficient assets (like REITs or high-yield bonds) go in IRAs or other tax-deferred accounts

• Tax-efficient or long-term growth assets go in taxable accounts

• Municipal bonds or tax-managed funds stay in brokerage

Smart asset location can improve after-tax returns without changing your actual allocation. It’s one of the simplest forms of hidden alpha.

3. Charitable Giving (With a Strategy)

Giving is good. Giving strategically is better.

We help clients:

• Use donor-advised funds to bunch giving and get bigger deductions in key years

• Gift appreciated stock instead of cash to avoid capital gains

• Time giving around high-income or high-gain years for maximum impact

Giving is personal. But done right, it’s also smart tax strategy.

4. Income Shifting

This is especially valuable post-sale, during semi-retirement, or when you expect your income to fluctuate.

It can involve:

• Converting traditional IRA funds to Roth in low-income years

• Delaying income into future years when your tax rate will be lower

• Realizing capital gains when you’re temporarily in a lower bracket

The point is: You can control the timing and type of income — if you plan ahead.

Why You Can’t Afford to Ignore This

You worked hard to build your wealth. You paid taxes the whole way there. Why would you keep overpaying now?

Even modest tax planning can result in:

• Lower effective tax rates

• Better cash flow

• Increased legacy impact

• A more flexible retirement drawdown strategy

• Fewer surprises come April

And the higher your income or net worth, the higher the stakes.

Tax Strategy Isn’t Just for the Ultra-Wealthy

You don’t need to be worth $50 million to benefit from tax planning.

Even a few smart moves can save thousands (or more). And the earlier you start, the more options you have.

At Compound Advisory, we build tax strategy into your financial plan, not around it.
Whether you’re selling a business, preparing for retirement, or just tired of writing massive checks to the IRS without a second thought — we’re here to help.

Final Thought: Pay What You Owe — Nothing More

We’re not in the business of dodging taxes.
We’re in the business of avoiding unnecessary taxes.

There’s a difference.

Because yes, paying your fair share is fine.
But paying more? Not on our watch.

Ready to take tax planning seriously?
Let’s build a plan that keeps more money in your pocket — and puts every dollar to work, the smart way.

Learn more at CompoundAdvisory.co