Your Complete Personal Tax Strategy Guide
Whether you're planning for retirement, transferring wealth to your kids, or just trying to pay less in taxes, this guide covers the 33 most effective strategies for individuals and families.
What's included:
- Retirement strategies (Roth conversions, backdoor strategies, catch-up contributions)
- Estate planning (trusts, gifting, wealth transfer)
- Family strategies (home sales, child tax credits, 529 plans)
- Real estate (1031 exchanges, rental strategies)
- Charitable giving (QCDs, donor-advised funds)
Author’s note (Sam Young, EA): I routinely implement Roth conversions, QCDs, home sale exclusions, and STR documentation for families—these checklists address the pitfalls I see most.
Retirement & Wealth Building (Strategies 1-8)
| Strategy | Potential Savings | Best For |
|---|---|---|
| 1. Mega Backdoor Roth | $5K-$50K+/year | High earners with 401(k) after-tax option |
| 2. Backdoor Roth IRA | $50K-$150K lifetime | High earners above Roth income limits |
| 3. Roth Conversion Ladder | $10K-$250K+ lifetime | Retirees in low-income years |
| 4. Withdrawal Sequencing | $5K-$100K+ lifetime | Order: Taxable → Tax-deferred → Roth |
| 5. NQDC Optimization | $5K-$40K/year | Executives with deferred compensation |
| 6. QCDs (Age 70½+) | $1K-$12K/year | IRA→charity, satisfies RMDs |
| 7. Catch-Up Contributions | $1K-$5K/year | Anyone 50+, extra $7,500 to 401(k) |
| 8. HSA as "Stealth IRA" | $500-$2K/year | Max HSA, invest it, use for retirement |
Top pick for most people: Backdoor Roth IRA if you earn too much for direct Roth contributions.
Estate Planning & Wealth Transfer (Strategies 9-24)
| Strategy | Savings | What It Does |
|---|---|---|
| 9. GRAT | $30K-$100K+ | Transfer appreciating assets to heirs with minimal gift tax |
| 10. IDGT | $50K-$250K+ | "Freeze" estate value, growth goes to beneficiaries |
| 11. SLAT | $100K-$500K+ | Use gift exemption while spouse keeps access |
| 12. 529 to Roth Rollover | $2K-$7K/year | Unused college savings → Roth IRA (NEW 2024!) |
| 13. Annual Gifting | $7K-$15K+/year | Give $19K/person ($38K married) tax-free annually |
| 14. Family Limited Partnership | $50K-$200K | Transfer assets with 25-40% valuation discounts |
| 15. QPRT | $50K-$300K+ | Transfer home while living in it |
| 16. Direct Tuition/Medical | $5K-$100K+/year | Pay tuition/medical directly—unlimited, no gift tax |
| 17-24. Advanced Trusts | Varies | GST, ILIT, Dynasty, Intra-family loans, CRT, CLT, DAF |
Most practical for regular families:
- Annual exclusion gifting ($19K/person/year)
- Direct tuition payments for grandkids
- 529 plans
Family & Homeowner Strategies (25-33)
| Strategy | Savings | What It Is |
|---|---|---|
| 25. Child Tax Credit | $500-$5K | Up to $2,200 per child under 17 (dollar-for-dollar credit) |
| 26. Child IRAs | $2.1K-$7K/year | Kids with earned income can save for retirement |
| 27. Clean Energy Credit | $2K-$20K | 30% credit on solar, wind, batteries |
| 28. Home Sale Exclusion | $15K-$75K+ | Exclude $250K/$500K of home sale gains (2 of 5 year rule) |
| 29. STR Loophole | $10K-$100K+/year | Short-term rental losses offset W-2 income |
| 30. 1031 Exchange | $25K-$150K | Defer capital gains on investment property sales |
| 31. Real Estate Professional | $10K-$100K+/year | 750+ hours → unlimited rental loss deductions |
| 32. Tax Loss Harvesting | $2K-$20K/year | Sell investment losers to offset gains |
| 33. Opportunity Zones | $20K-$200K+ | 10-year hold = permanent appreciation exclusion |
Biggest opportunities for most families:
- Home sale exclusion ($250K/$500K tax-free!)
- Child tax credits (if you have kids)
- Roth IRA strategies (if high earner)
- STR loophole (if you buy vacation rental)
Which Strategies Apply to You?
High earners ($300K+):
- Mega/Backdoor Roth strategies
- Estate planning trusts
- Tax loss harvesting
Retirees:
- Roth conversions (during low-income years)
- QCDs (if 70½+)
- Strategic withdrawal order
Families with kids:
- Child tax credits (easy $2,200/child)
- 529 plans
- Child IRAs
- Annual gifting
Real estate owners:
- Home sale exclusion ($250K/$500K tax-free!)
- STR loophole or REP status
- 1031 exchanges
- Cost segregation
Common Questions
Q: Can I combine multiple strategies?
A: Yes! That's how you maximize savings. Example: Backdoor Roth + Tax Loss Harvesting + Home Sale Exclusion.
Q: Do I need to be wealthy to use these?
A: No. Child tax credits, home sale exclusion, Roth IRAs, and 529 plans work for middle-class families. High-net-worth strategies (GRATs, SLATs) are for estates $5M+.
Q: What's the biggest mistake?
A: Waiting too long. Many strategies need action BEFORE year-end or before major life events. Plan proactively.
Q: Should I hire a professional?
A: For basic strategies (child tax credit, home sale exclusion), your regular CPA is fine. For advanced strategies (trusts, complex Roth conversions), hire a specialist.
Your Action Plan
This month:
- Review which strategies apply to you
- Talk to your CPA or tax advisor
- Identify 2-3 quick wins
This year:
- Implement highest-ROI strategies
- Plan year-end moves (before Dec 31)
- Set up for ongoing optimization
Related Reading
Disclaimer: Educational content only. Work with qualified tax professionals.
Sources
- IRS Publication 590-A/B — Individual Retirement Arrangements (IRAs): https://www.irs.gov/forms-pubs/about-publication-590-a
- IRS Publication 969 — HSAs and Other Tax-Favored Health Plans: https://www.irs.gov/forms-pubs/about-publication-969
- IRS Publication 523 — Selling Your Home (Section 121): https://www.irs.gov/forms-pubs/about-publication-523
- 26 U.S.C. §121 — Exclusion of gain from sale of principal residence: https://www.law.cornell.edu/uscode/text/26/121
- IRS Publication 970 — Tax Benefits for Education (529 plans): https://www.irs.gov/forms-pubs/about-publication-970
- 26 CFR §1.469-1T and §1.469-5T — Passive activity/Material participation (STR/REPS): https://www.law.cornell.edu/cfr/text/26/1.469-1T
- IRS Publication 550 — Investment Income and Expenses (tax loss harvesting): https://www.irs.gov/forms-pubs/about-publication-550