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Would you like to Defer an Additional 100k - 250k of Taxable Income?

Would you like to Defer an Additional 100k - 250k of Taxable Income?

November 18, 2019
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As we near the end of the year, now is the time to start doing some more in depth income tax planning.   Depending on your age and income, having the ability to defer 100k – 250k of taxable income can be a very powerful tax planning tool.  This may also help you qualify for a partial or full Qualified Business Income deduction under the right circumstances. The retirement planning vehicle we commonly use to defer larger amounts than your typical 401(k) is a Cash Balance Plan.

Many times the financial advisory industry thinks of adding a Cash Balance Plan in addition to a 401(k), which is a common planning strategy; however, we have occasionally recommended standalone plans with no 401(k) at all.  Also, we are doing some really innovative planning in this space and are currently have a few options specifically in mind for dentists in their late 30s. While not the typical candidate when you think of a Cash Balance Plan (age is one contributing factor), over 80% of the practice contributions are still going towards the owners.    

Cash Balance Plans have to be set up by year end and funded by tax filing time.  While everyone's situation is unique, Cash Balance Plans when structured properly can be very powerful from a retirement savings and tax planning prospective. If you would like to review your personal situation or year-end tax planning strategies please feel welcomed to connect.

- Ryan

NaviPath Financial - 704.248.6771 -


Waddell & Reed does not offer tax advice.  This is meant for educational purposes only.  It should not be considered investment advice, nor does it constitute a recommendation to take a particular course of action. Please consult with a financial professional regarding your personal situation prior to making any financial related decisions.