Tax Planning

Partnering with your Accountant/CPA

  • Working with Glover Park Wealth, we look at the implications of taxes when it comes to

  • making investment decisions for clients in taxable brokerage accounts.

  • We work with your Accountant/CPA to ensure your portfolio is tax efficient.

  • Managing the tax implications of a portfolio is very important in the long run when evaluating the overall performance of a portfolio and minimizing taxes where available using tax-loss harvesting strategies.

Tax-Loss Harvesting

  • During the year, we will monitor the performance of your investment portfolio and make decisions using our tax-loss

  • harvesting strategy to reduce your overall investment costs and offset realized short-term and long-term taxable gains.

Capital Gains

  • When taking profits in an investment, we consider the length of time the investment was held in the account to take advantage of the lower long-term capital gains tax rate.

  • If there are opportunities to wash the long-term gain with an underperforming asset, we will proactively take the opportunity to offset gains against losses.

RMD IRA Distributions

  • We will work with you and your CPA to discuss the implications of taking IRA distributions and how it affects your income tax bracket.

  • The RMD Distribution rules were recently updated with the passing of the SECURE 2.0 Act.

RMD Age Requirements

  • “You must take your first required minimum distribution for the year in which you turn age 73 (70 ½ if you reach 70 ½ before January 1, 2020). However, the first payment can be delayed until April 1 of 2020 if you turn 70½ in 2019. 

  • If you reach 70½ in 2020, you have to take your first RMD by April 1 of the year after you reach the age of 73.

  • For all subsequent years, including the year in which you were paid the first RMD by April 1, you must take the RMD by December 31 of the year.” 

Source: Retirement Plans FAQs regarding Required Minimum Distributions | Internal Revenue Service (

 IRA Distribution Rules

  • IRA distributions or withdrawals are considered taxable income, you will receive a 1099 from your brokerage firm in the year the distribution was received. 

  • You can withhold federal and state income taxes when taking a distribution which makes tax planning much easier at the end of the year. 

There are distribution rules that are very important regarding IRAs:

  1. 10% Penalty: IRA withdrawals or distributions which are taken before the age of 59 ½ years old are considered an early withdrawal and subject to a 10% penalty of the total distribution on top of the ordinary income taxes that will be owed.

  2. Exceptions: There are exceptions to the 10% Penalty on an early withdrawal, the IRS has an approved list of exemptions which include: first-time home purchases, disability or military service.

    The full list of exceptions from the IRS: Retirement Topics Tax on Early Distributions | Internal Revenue Service (

Roth IRA Distribution Rules

  • Roth IRA contributions are not tax-deductible, and earnings grow tax-free. Qualified withdrawals from the Roth IRA are tax and penalty free.

  • The Roth IRA does have withdrawal rules which vary depending on your age and the length of time you have held the account which is the five-year rule.

  • Qualified withdrawals are taken after the five-year holding period are tax-free and penalty free after age 59 ½.

  • If you take a distribution that does not meet the five-year rule and is before the age of 59 ½, then the earnings on the Roth IRA are subject to income tax and a 10% penalty, your principal can always be withdrawn tax and penalty fee. 

There are special exceptions to a withdrawal in the following situations:

  1. $10,000 lifetime maximum) to pay for a first-time home purchase.
  2. Pay for qualified education expenses.
  3. Qualified expenses related to a birth or adoption
  4. You become disabled or pass away.
  5. Pay for unreimbursed medical expenses or health insurance if you're unemployed.
  6. The distribution is made in substantially equal periodic payments.

 Please see the website to learn more and consult with your CPA or Tax Advisor: Roth IRAs | Internal Revenue Service (

Municipal Bonds

  • Depending on the client’s income goals, we may recommend individual municipal bonds or municipal bond funds that may be exempt from Federal and State Income taxes. 

  • There are several variables that go into municipal bond planning which include the:  Bond Rating, state of resident, state of municipal bond issuer, sinking fund and interest rates. 

  • We will work with your CPA, EA or Tax Preparer in these areas to make sure that your municipal bond portfolio is tax efficient.

Business Succession Planning

  • Are you a business owner and thinking about your succession planning going forward? Glover Park Wealth has years of experience in working with business owners and there are several factors involved when it comes to succession planning.

  • As the business owner, you may wish to pass the business down to your heirs or sell it, before or after you pass away.

  • Regardless of which path you decide, our goal is make sure you speak with the right advisors in each area to ensure that you can pass the business to family or sell your business at the highest valuation in the most tax-efficient manner.

Tax Considerations

  • Working with your CPA and Estate Planning Attorney, we will want to make sure you are aware of all the scenarios involved in selling your company. 
    1. How much taxes will I owe, or my family owe?
    2. Do you sell the entire LLC or Corporation?
    3. Do you sell the assets inside the corporation?
    4. How do I get a valuation on my company? 
  • These are some of the questions that you will have when it comes to selling a company and we will work with your trusted advisors to ensure the best outcome for your long term financial and retirement plan.

Selling Business to Co-Owner?

  • If the business has one or more owners, you might consider establishing a buy-sell agreement that upon the death of any owner, their interest is automatically purchased by the other owner(s), therefore providing liquidity to the family of the owner who has passed.

  • The buy-sell agreement is typically constructed using a Life insurance contract that the insurance division of Glover Park Wealth can provide to the client which can also be done inside an irrevocable life insurance trust (ILIT) to provide liquidity to the family or estate of the business owner.

Employee Stock Option Plan: (ESOP)

  • How an ESOP Works: The company works with outside advisors to determine the valuation of the company and then sets up the ESOP to create a trust for the employees.

  • The shares of the company are allocated to employees who are deemed eligible for the ESOP and then are subject to vesting requirements set forth in the ESOP Agreement.

  • Glover Park Wealth has a team of trusted ESOP advisors that are willing and able to put together a proposal for your company and go over all questions and objectives when it comes to business succession planning with an ESOP.