We see it every year. High-income earners wait until March to think about taxes, then scramble to find deductions that no longer exist.
The biggest tax-saving opportunities don’t happen at filing time. They happen now, through deliberate year-round planning. For most high-income clients, this shift from reactive filing to strategic planning saves tens of thousands of dollars annually.
Here’s how to make sure you’re not leaving money on the table in 2026 and save tens of thousands in taxes.
Know Your Numbers First
The top marginal tax rate of 37% kicks in at $640,600 for single filers and $768,700 for married couples filing jointly. But there’s another threshold that matters more for planning purposes.
Watch the jump from the 24% bracket to the 32% bracket. That happens at $201,775 for single filers and $403,550 for married couples. This 8-percentage-point increase makes strategic income timing worth your attention.
Why this matters: If you’re hovering near these thresholds, deferring income or accelerating deductions can keep you in a lower bracket.
Max Out Retirement Contributions (The Right Way)
For 2026, you can contribute $24,500 to your 401(k), up from $23,500 in 2025. If you’re 50 or older, add another $8,000 in catch-up contributions.
But here’s where it gets interesting for high earners ages 60-63. The super catch-up provision gives you an even bigger opportunity to defer taxes during peak earning years.
The Catch-Up Rule You Need to Know
Starting January 1, 2026, if you’re 50 or older and earned over $150,000 in 2025, you must make your catch-up contributions in a Roth account only.
This changes how you structure contributions. You lose the upfront tax deduction on catch-up amounts, but you gain tax-free growth and withdrawals later. Strategic Roth conversions can complement this approach to build tax-free income in retirement.
Plan accordingly. If you were counting on that deduction to lower your 2026 tax bill, you need a different strategy.
Use the Mega Backdoor Roth Strategy
Your modified adjusted gross income exceeds the Roth IRA limits ($168,000 for single filers, $252,000 for married couples). That doesn’t mean you’re locked out of Roth benefits.
The mega backdoor Roth uses after-tax 401(k) contributions, up to the total IRS limit of $72,000 in 2026, and rolls those into a Roth account. This works if your employer plan allows after-tax contributions and in-service conversions.
Here’s the process:
1. Max out your regular 401(k) contribution ($24,500)
2. Add employer match (varies by plan)
3. Make after-tax contributions up to the $72,000 total limit
4. Convert those after-tax dollars to a Roth account
You pay taxes on any earnings between contribution and conversion, but growth after that is tax-free.
Stop Ignoring Your HSA
Most people treat Health Savings Accounts as medical expense funds. That’s leaving money on the table.
An HSA invested in low-cost index funds and left untouched until retirement functions as a secondary IRA with better tax treatment than either a traditional or Roth account.
You get three tax advantages:
- Tax deduction on contributions
- Tax-free growth
- Tax-free withdrawals for qualified medical expenses
For 2026, you can contribute $4,400 as an individual or $8,750 for family coverage. Add $1,000 if you’re 55 or older.
The strategy: Pay medical expenses out of pocket, keep receipts, and let your HSA grow. You can reimburse yourself decades later, tax-free, while the account compounds. Learn more about optimizing after-tax returns through strategic account placement.
Address Your Capital Gains Problem
The S&P 500 has surged more than 75% since the beginning of 2023. If you’ve invested, you’re sitting on significant unrealized gains.
Mitchell Drossman, head of national wealth strategies at Bank of America, puts it plainly: “The biggest tax story to me is a capital gains and investing story. You have lots of clients who are sitting on significant gains.”
Selling creates a tax bill. Not selling creates concentration risk and limits your ability to rebalance.
Options to consider:
- Tax-loss harvesting to offset gains
- Spreading sales across multiple years to manage bracket impact
- Gifting appreciated securities to charity for a deduction at fair market value
- Using qualified opportunity zones if reinvestment timing works
We help clients navigate this regularly. The right approach depends on your complete financial picture, not just the tax rate. Understanding proper asset location is critical for managing tax impact.
Rethink Estate Planning
Last year’s tax bill permanently raised the estate tax exemption to $15 million per person, up from $13.99 million.
For most high-income earners, the federal estate tax is no longer the primary concern. The focus has shifted to minimizing income and capital gains taxes, both during your lifetime and for your heirs.
This creates opportunities for strategic wealth transfer that prioritizes tax efficiency over estate tax avoidance. For retirees, understanding RMD strategies becomes essential for minimizing lifetime taxes.
Don’t Leave Money on the Table
One in five taxpayers forfeit an average of $2,700 in potential benefits by missing eligible deductions and credits.
For high-income earners, that number is usually much higher. The tax code is complex, and the strategies that save the most require coordination across your entire financial picture.
Pro tip: Year-round tax planning isn’t about finding loopholes. It’s about using the tax code as written to keep more of what you earn.
Work with Professionals Who Understand Your Situation
At KEEN Capital, we don’t just drop you into a cookie-cutter investment model and walk away. We’re hands-on investment strategists with both CFP and CFA professionals on staff.
We bring depth and clarity to every part of your strategy, making sure your investments, retirement planning, and tax approach work together.
Tax planning for high-income earners requires understanding how every decision affects your complete financial picture. We help you see those connections and make choices that maximize your after-tax results.
The strategies that save tens of thousands start now, not at filing time.
Ready to build a tax-aware investment strategy? Let’s talk about how we can help you keep more of what you earn while building long-term wealth.
Schedule a conversation with our team at www.keencapital.com.
