As a financial advisor (Marcus Dickerson) focused on helping clients keep more of their hard-earned money, I’m always on the lookout for innovative strategies to reduce tax liabilities. Recently, I had the pleasure of speaking with Mark Myers, the Founder and CEO of Taxwise Partners, and a self-proclaimed “Tax Savings Architect” who specializes in finding often-overlooked opportunities in the tax code.
Mark’s Unique Approach
Mark’s approach is unique in that he works alongside clients’ existing CPAs and financial advisors, providing additional analysis and strategies to help minimize taxes. He doesn’t replace these professionals but rather enhances their work by identifying key areas where clients can save. His company, Taxwise Partners, has helped thousands of individuals increase profit and permanently reduce their annual tax bill.
So, Who Can Benefit from Mark’s Expertise?
He outlined several ideal clients or scenarios:
1. Business owners planning to sell their business and looking to minimize or eliminate the 20-40% capital gains tax on the sale price.
2. Real estate investors selling highly appreciated properties and seeking alternatives to 1031 exchanges to defer or eliminate capital gains tax.
3. High-income W-2 earners, especially those earning over $400,000 per year, looking to reduce their tax burden. Business owners may have opportunities even if their income is below $400,000.
4. Individuals selling highly appreciated assets like stocks, businesses, or real estate, aiming to minimize or eliminate capital gains tax.
The Importance of Timing
One key takeaway from our conversation was the importance of timing. Too often, people wait until after a major transaction to start thinking about tax implications. By then, it’s usually too late. The earlier you can start planning, the more opportunities you’ll have to minimize your tax bill.
Real Estate Investors: An Alternative to 1031 Exchanges
Mark shared an interesting example of how he helps clients selling appreciated real estate. Many investors assume a 1031 exchange is their only option to defer capital gains taxes. However, 1031s have strict timelines (45 days to identify a new property and 180 days to close) and can be challenging in a hot market where you’re selling high but also having to buy high.*
As an alternative, Mark helps clients set up specialized trusts to receive the proceeds from the sale. By structuring it correctly, the trust can essentially “acquire” the asset at the same price as the sale, resulting in no taxable gain. The trust then issues a note to the client, allowing them to defer taxes and have more control over the funds. In some cases, this deferral can be extended for generations.
Solar Energy Investments: A Powerful Tax Reduction Strategy
Another exciting opportunity Mark discussed was investing in solar energy projects. Many high-income earners, including W-2 employees, can offset their tax liabilities by purchasing solar installations on commercial properties like churches, schools, or grocery stores. By structuring the acquisition correctly, every dollar that would have been sent to the IRS can instead be used to fund a solar business.
The federal government offers substantial incentives for these investments, including tax credits, depreciation benefits, and potential cash flow from the energy generated. Mark explains that this strategy effectively eliminates taxes in the first year, provides a complete return of capital, and creates a cash-flowing asset that can generate income for the next 25-35 years.
The Importance of Working with Experienced Professionals
Of course, as with any advanced tax planning, the devil is in the details. It’s crucial to work with experienced professionals who understand the nuances of the tax code and can ensure everything is executed properly. Missing key steps or documentation can lead to costly mistakes.
That’s where Mark and his team at Taxwise Partners come in. They act as guides and facilitators, vetting potential strategies and connecting clients with the right experts to implement them effectively. With over a decade of experience, Mark has built relationships with top legal and accounting groups to provide turnkey solutions for his clients.
The Bottom Line
The bottom line is that there are numerous opportunities in the tax code for those who know where to look. By proactively planning and working with specialists like Mark, high-income earners and those with appreciated assets can potentially save hundreds of thousands or even millions in taxes.
Next Steps
If you’re interested in learning more, I highly recommend visiting Mark’s website at taxwisepartners.com. There, you can request case studies, learn more about Mark’s background, and even book a complimentary 30-60 minute consultation to see if these strategies might work for you. As Mark mentioned, in that short conversation, he can usually determine if there’s a good opportunity for tax savings.
Our team is also happy to facilitate a meeting with Mark to explore strategies specific to your unique situation. Please don’t hesitate to reach out if you’d like us to coordinate an introduction.
Remember, as the famous Judge Learned Hand once said, “There are two tax systems in America: one for the informed and one for the uninformed. Both are legal.” With the right knowledge and guidance, you can ensure you’re on the right side of that divide, keeping more of your hard-earned money in your pocket and less in the hands of the IRS.
*Changes in real estate values or economic downturns can have a significant negative effect on issuers in the real estate industry.