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Why it Pays to Have Your Financial Advisor Collaborate with Your CPA

Why it Pays to Have Your Financial Advisor Collaborate with Your CPA

July 06, 2023

While taxes sometimes get a bad rap, in the financial world we view them as a strategic piece of the monetary puzzle that, when utilized correctly, can present unique opportunities for our clients.   

In a previous post, we covered the Three Benefits of Working with a Financial Advisor and mentioned the importance of including tax considerations in your overall financial plan. We regularly collaborate with CPAs when advising our clients and believe it’s a crucial step. Let’s explore a few reasons why we believe in being tax intelligent when it comes to wealth management. 

It’s not just about what you earn—it’s also about what you keep.  

Many people think financial planning is about what you earn, how well you invest and how much you save. While those are certainly some primary pillars of your plan, we believe what you keep is just as important. The tax code is long, complex and changes regularly – something that requires a tax professional to properly navigate. Enlisting a skilled CPA who understands these complexities will help you retain as much of your assets as possible. Tax-advantaged wealth strategies include knowing how much you can gift to family members without having to pay taxes or the long- and short-term tax advantages of setting up a trust. We regularly discuss and implement tax strategies for our clients as we help them achieve their financial goals. 

Tax planning isn’t just for tax season. 

While most people put taxes out of their minds after April 15 each year, tax strategy should be a topic of conversation with financial advisors year-round. Financial advisors can work with a CPA to ensure clients remain on track to receive desired tax outcomes by factoring in considerations such as anticipated raises or bonuses, taxable events, or strategic opportunities. Financial agility and tax planning throughout the year can save you thousands come tax season and set you up for better outcomes in the years to come. 

Taxes often accompany major life transitions.  

Life happens, and important events will inevitably arise, both planned and unplanned. It’s important to look at your financial future year-over-year, but also be cognizant of the bigger picture that will span decades and a lot of change. For example, you may decide it’s time to sell your business or you might inherit some money or property. Both of these scenarios have tax opportunities, if handled proactively with the guidance of a tax professional working hand-in-hand with your financial advisor.  

Call us today to learn how Willis & Machnik can work with your CPA to help implement tax strategies that work to your benefit in your overall financial plan.