Taxes aren’t just an April headache—they’re a year-round challenge that can shape your retirement. In the A Smarter Way to Retire podcast, Tony Leonardi, a CERTIFIED FINANCIAL PLANNER® professional, shares five game-changing moves to save thousands, plus a 2026 deadline to watch. Missed our April 15th tax history episode? Catch it at leonardifamilywealthcare.com. Listen on Apple Podcasts or Spotify, sign up for our free 2025 Retirement Reset Checklist by entering your email at 2025-retirement-reset-checklist, and watch our Taxes in Retirement Webinar - Strategies to Keep More of Your Money at Tax Webinar or YouTube!
Why Tax Planning Matters for Retirement?
Up to 85% of Social Security can be taxed, IRA withdrawals hit as ordinary income, and Required Minimum Distributions (RMDs) at 73 may push you into higher brackets. The Tax Cuts and Jobs Act expires in 2026, potentially raising the top rate from 37% to 39.6%. “I’ve seen retirees lose thousands without planning,” says Tony Leonardi, CFP® professional. Using A Smarter Way to Retire strategies and MoneyGuidePro, you can keep more for beach sunsets or grandkid fishing trips. Start with our 2025 Retirement Reset Checklist at 2025-retirement-reset-checklist.
5 Tax-Smart Retirement Moves
How can you save on taxes in retirement? Here are five moves:
1. Roth Conversions
Convert traditional IRA/401(k) funds to a Roth IRA for tax-free growth and withdrawals. Pay taxes now (e.g., $50,000 conversion in 2025 could save $10,000 over a decade if rates rise). “Use MoneyGuidePro to avoid jumping tax brackets,” advises Tony. Consult your advisor and check our checklist at 2025-retirement-reset-checklist.
2. Timing Withdrawals
Take IRA distributions in low-income years (e.g., delaying Social Security). A couple in the 12% bracket could withdraw $20,000 tax-free up to the $29,200 joint standard deduction (2025). Spread withdrawals to avoid higher brackets—Tony’s client saved $4,000 over two years. Use MoneyGuidePro to plan and grab our checklist for a withdrawal tracker.
3. Qualified Charitable Distributions (QCDs)
At 70½+, donate up to $105,000 from your IRA to charity tax-free, counting toward RMDs. A $5,000 gift at 22% saves $1,100. “It’s a win-win for you and your causes,” says Tony. Set it up with your advisor and see our QCD guide on leonardifamilywealthcare.com.
4. Bunching Deductions
Bundle expenses (charitable gifts, medical costs) to itemize when near the $14,600 (single) or $29,200 (couple) standard deduction (2025). A client doubled donations to $30,000, saving $2,500, then took the standard deduction the next year. Plan with your CPA using our deduction tracker on the checklist.
5. Relocate to Low-Tax States
Move to no-income-tax states like Florida, Nevada, or Texas, saving 5-10% annually. A client saved $15,000 yearly moving from New Jersey to Florida. Explore state exemptions (e.g., New Jersey seniors) with your advisor and check our state tax guide.
Fun Tax Tidbit
Gift $18,000 per person tax-free in 2025 (e.g., $36,000 for couples) to kids or grandkids for college or cars. “Clients love funding 529 plans this way,” Tony notes—a tax-free high five!
3 Questions to Spark Your 2025 Tax Plan
- Have you stress-tested RMDs at 73? A big account could cost thousands.
- Could Roth conversions or QCDs save you before 2026 rate hikes? Time’s ticking.
- Are you working with a CFP® professional? Don’t go solo—contact us at leonardifamilywealthcare.com.
FAQ: Your Tax-Smart Retirement Questions Answered
Q: How do Roth conversions save money?
A: Convert now at lower rates (e.g., 22%) to avoid future hikes (e.g., 39.6% in 2026), saving thousands long-term.
Q: What are QCDs and how do they work?
A: Donate up to $105,000 from your IRA to charity tax-free at 70½