CSA Journal, an award-winning, leading professional publication in the senior market focusing on critical issues for aging adults, recently featured WRP Wealth Management partner Aaron Rubin as a financial expert. In the article, "A Brief Guide to Highly Appreciated Assets," he provides valuable insights into managing tax liability when drawing retirement income from various sources, including pre-tax accounts, post-tax accounts, and real estate. Aaron Rubin offers strategies to reduce tax liability during retirement:
1. Pre-Tax Accounts: The article highlights the tax challenges associated with pre-tax retirement accounts such as 401(k)s and IRAs. Contributions to these accounts provide tax advantages during the accumulation phase, but withdrawals are taxed as ordinary income. Aaron suggests several strategies to mitigate this tax burden, including making qualified charitable contributions (QCDs) directly from IRAs, limiting distributions to the required minimum distribution (RMD), and leaving pre-tax accounts to charitable entities through legacy giving.
2. Real Estate: For retirees who own real estate, especially properties held for long periods, capital gains tax can pose a significant challenge when selling. Aaron discusses the capital gains tax implications and offers guidance on tax-efficient strategies. These include utilizing the IRC Section 121 gain exclusion for primary residences, considering Section 1031 exchanges for investment properties, and being mindful of state income tax implications. He also emphasizes the importance of property titling and planning for the step-up in basis upon the death of an owner.
3. Post-Tax Accounts: The article also addresses the management of highly appreciated stock or mutual funds held in post-tax accounts. Investors can potentially benefit from the step-up in basis upon a spouse’s death, but Aaron suggests using active tax loss harvesting (ATL) to strategically sell high-basis positions over time. Additionally, he highlights the tax advantages of donating appreciated stock to qualified charities, offering insights into the rules and limitations associated with such donations.
Aaron Rubin's article provides retirees with an overview of tax-efficient strategies to manage highly appreciated assets during retirement, providing options for optimizing income and minimizing tax liability.
Aaron Rubin is an experienced financial advisor and a partner at WRP Wealth Management. With more than 20 years of experience in the financial industry, Rubin has built a reputation for providing comprehensive, personalized financial guidance for his clients.
CSA Journal is the official publication of the Society of Certified Senior Advisors (SCSA), an organization dedicated to educating and certifying professionals working with older adults. SCSA's Certified Senior Advisor (CSA)® credential signifies competence and knowledge in serving older adults. CSAs adhere to a strict code of professional responsibility and must complete an ethics module, ensuring the well-being of older adults is paramount. Accredited by the American National Standards Institute (ANSI) and the National Commission for Certifying Agencies (NCCA), the CSA credential applies to various aging industry sectors, and SCSA continuously improves its programs to maintain high standards. CSAs stand out for their commitment to excellence, ongoing education, ethics, and trustworthiness, setting them apart in professional service to seniors.
.svg)
WRP is a team of tax and financial management professionals with expertise in company-issued stock options. We use research-based investment strategies to grow and protect our clients’ investments and a personalized, one-on-one approach to understand each individual’s goals and priorities. A proud Bay Area business, we are dedicated to local philanthropy and contribute time and resources to local charities to support our community’s long-term well-being.