You’ve spent years grinding. Building a business, investing smart, and setting yourself up for success. But now, as you start thinking about retirement, you realize one huge problem:
How much of your hard-earned money will actually be yours… and how much will go straight to the IRS?
Spoiler alert: without a tax plan, you could end up paying way more than necessary. That “comfortable” retirement fund? It might shrink fast if taxes aren’t handled strategically.
At Insogna CPA, one of the top CPA firms in Austin, Texas, we help business owners, real estate investors, and high earners keep more of their wealth in retirement legally, strategically, and stress-free. Let’s break down what’s at stake and how to protect your money from unnecessary taxes.
The Problem: Taxes Could Wipe Out More of Your Retirement Savings Than You Think
Most people assume that once they retire, their taxes will magically go down. But the reality? Many retirees actually face higher tax rates than they did while working.
Here’s why:
- Your 401(k) and IRA withdrawals are taxed as income – That “tax break” you got when contributing? It comes back around—every dollar withdrawn gets taxed at your regular income rate (which could be 30%+).
- Required Minimum Distributions (RMDs) – Once you hit 73, the IRS forces you to start withdrawing from tax-deferred accounts, whether you need the money or not—potentially pushing you into a higher tax bracket.
- Real estate investors aren’t always tax-free – Thinking your rental properties will fund your retirement, tax-free? Not necessarily. Without a strategy, rental income can get taxed heavily.
Without a tax plan, you could be giving away thousands to the IRS unnecessarily.
Why This Happens: The Retirement Tax Trap
Retirement planning isn’t just about saving. It’s about knowing how to keep more of what you’ve saved.
Here’s why so many people fall into the tax trap:
- Assuming lower taxes in retirement – You might be making more in passive income than you expected, and RMDs could push you into a higher tax bracket than when you were working.
- Not diversifying tax-free income – If all your money is in tax-deferred accounts (like a 401(k) or Traditional IRA), every dollar you withdraw is taxed. A Roth account, on the other hand, grows tax-free.
- Ignoring real estate tax benefits – Rental properties can provide tax-free cash flow, but only if structured correctly (spoiler: a great Austin tax accountant can help with that).
The good news? You don’t have to accept these tax hits. You just need the right strategy.
The Solution: How to Keep More of Your Money in Retirement
Retirement planning is about playing offense, not defense. The key is structuring your income now to pay the least amount of taxes legally possible. Here’s how:
1. Use the Right Retirement Accounts
Different retirement accounts have different tax treatments. If you’re not using the right mix, you could be setting yourself up for a tax-heavy retirement.
Account Type | Tax Treatment | Best For |
Traditional 401(k)/IRA | Contributions lower taxable income now, but withdrawals are taxed later | Lowering taxable income today, but expect taxes in retirement |
Roth 401(k)/IRA | Contributions are after-tax, but withdrawals are 100% tax-free | Tax-free growth & avoiding high taxes in retirement |
SEP IRA | Contributions are tax-deductible, with higher limits than a regular IRA | Self-employed business owners needing a big tax deduction |
Pro Tip: The smartest approach? A mix of Roth and Traditional accounts so you have more flexibility when it comes time to withdraw. An Austin small business accountant can help you set this up correctly.
2. Use Real Estate to Create Tax-Free Cash Flow
If you own rental properties, you already have one of the best tools for tax-free income in retirement but only if structured correctly.
- Depreciation deductions – Reduce taxable rental income without spending cash.
- 1031 exchanges – Swap properties without paying capital gains taxes.
- Real estate professional status – Offset active income with rental losses legally.
Many real estate investors don’t realize that rental properties can provide long-term tax-free wealth—but only if structured strategically. A tax advisor in Austin can make sure you’re doing it right.
3. Plan for Tax-Free Withdrawals
Want to keep more of your money? It’s all about knowing when (and how) to withdraw.
- Roth conversions – Move money from taxable accounts to Roth IRAs at lower tax rates, so future withdrawals are tax-free.
- Strategic withdrawals – Pull from tax-free sources (Roth, real estate, etc.) before tax-deferred accounts.
- Delay Social Security – If you don’t need it right away, waiting could reduce taxes on your benefits.
Fact: A well-planned withdrawal strategy could save you tens of thousands in unnecessary taxes. A CPA in Austin, Texas, can help you create a custom plan.
Let’s Build Your Tax-Efficient Retirement Plan
You worked hard to build your wealth. Now it’s time to protect it with a retirement tax strategy that lets you keep more of your money and pay less to the IRS.
At Insogna CPA, we help business owners and investors create tax-smart retirement plans that minimize taxes and maximize wealth. Whether you need help choosing the right retirement accounts, structuring real estate investments, or planning tax-free withdrawals, we’ve got you covered...
A tax-efficient retirement starts now. Schedule a strategy session with our experts today!