At The Money: Tax Day Special

Episode Summary

Executive Summary: Barry Ritholtz and tax specialist Bill Artseronian outline year-end tax moves for high earners, emphasizing that tax planning is inseparable from financial planning. They cover deferring gains, tax-loss harvesting, charitable bunching, retirement and HSA contributions, and how 2025–2026 rule changes affect SALT and deductions.

Main Topics: Tax planning as financial planning (Priority: 5/5): Taxes touch cash flow, insurance, estate planning, and portfolio decisions. Deferral vs. avoidance (Priority: 5/5): Many tactics only defer tax, so timing matters as much as the strategy. Year-end moves for high earners (Priority: 5/5): Charity, equity comp, and small-business planning offer the biggest savings levers. Retirement and HSA contribution limits (Priority: 4/5): Maxing tax-advantaged accounts remains a core year-end checklist item. Tax-loss harvesting and gain timing (Priority: 4/5): Harvest losses regularly and manage gains to optimize federal and state taxes. Charitable bunching and donor-advised funds (Priority: 4/5): Concentrating gifts can unlock deductions when standard deduction thresholds are high. SALT and 2025–2026 law changes (Priority: 5/5): The SALT cap rises, while charitable and catch-up contribution rules tighten.

Key Arguments: Tax advice is financial advice because taxes affect nearly every major planning decision. Deferral strategies help, but taxes on 401(k)s, depreciation, and opportunity zones eventually come due. Pushing gains from Q4 2025 into Q1 2026 can create a full year to harvest offsetting losses. Many charitable gifts provide no benefit if the taxpayer still takes the standard deduction. Equity-compensation timing can avoid higher brackets or unintended AMT exposure. QBI can shrink or disappear if wage and compensation rules are mishandled. Tax-loss harvesting should happen year-round, not just in December. The new SALT cap is better for many high-tax-state households, but phased-out above certain incomes. 2026 catch-up contributions must be Roth, increasing after-tax flexibility later.

Data Points: Vanguard bond funds: over 80 - Advertisement for active fixed-income lineup Vanguard fixed-income team size: 200-person - Advertisement describing global bond team Catch-up contributions: 7,500 - Age-50+ retirement catch-up amount for this year and next year 401(k) max: $70,000 - Total employer + employee contribution limit this year SALT deduction cap: $10,000 - Prior limit in place since 2017 SALT deduction cap: $40,000 - New limit under the latest tax law SALT phaseout begins: $500,000 - Total income level where the larger SALT deduction starts to phase out SALT full phaseout: $600,000 - Income level where SALT deduction returns to $10,000 Charitable deduction floor: 0.5% of AGI - First slice of charitable giving not deductible next year Charitable example: $5K - First deductible-loss-free amount on $1 million AGI Top-bracket charitable limitation: 37% bracket treated as 35% - High earners lose 2 percentage points of deduction value next year

Pivotal Quotes: "tax advice is financial advice" — Barry Ritholtz: Framing the episode's central thesis "Our clients would rather save $1,000 on taxes than make six figures in a trading day." — Bill Artseronian: Explaining why tax savings matter to clients "Nobody ever regrets a Roth contribution." — Bill Artseronian: Discussing the move to Roth catch-up contributions

Implications: Listeners should revisit year-end transactions now, because 2025 timing choices and 2026 rule changes can materially alter the value of deductions and account contributions.