For every new client engagement at Melby Wealth Management, one of the first things we look at is whether the client has been planning their taxes or merely filing them. The two are easy to confuse, and the difference is often worth more than any single investment decision. Most people arrive having done a careful job of reporting last year's numbers and almost no work positioning this year's.
As a CERTIFIED FINANCIAL PLANNER® (CFP®) professional running a fee-only fiduciary firm in Nashville, my goal in writing this is to describe what proactive tax planning looks like across a full financial life, and where coordinating it with the rest of your plan changes the result.
Filing Looks Backward. Planning Looks Forward.
A tax return documents decisions that are already final. Planning is the set of choices you make during the year, while the outcome is still in your hands: how much to defer, which accounts to fund, when to recognize gains or losses, and how to sequence income. For the clients I work with, several of whom have equity compensation, business income, or assets spread across taxable, tax-deferred, and tax-free accounts, those choices compound into real money over time.
The complexity is exactly why a checklist alone is not enough. The moves interact. A larger retirement contribution can preserve a deduction that phases out at higher income. Harvesting a loss can offset the gain from exercising stock options. Each decision changes the others, and seeing the whole board is the job.
Where Professional Guidance Changes The Result
A well-written article can teach the contribution limits and the bracket math. Here is what it cannot do, and where I add value for clients:
Asset location. Which investments belong in your taxable account, your IRA, and your Roth is a decision that quietly raises your after-tax return without changing your portfolio's risk. Putting tax-inefficient assets in sheltered accounts and tax-efficient ones in taxable accounts is one of the most reliable, least visible improvements available.
Roth conversion timing. In lower-income years, a gap year between jobs, a sabbatical, the early years of self-employment, converting traditional dollars to Roth at a low marginal rate can lock in decades of tax-free growth. I would generally recommend modeling conversions across multiple years rather than reacting in a single one.
Coordinating gains, losses, and income. For clients with concentrated stock or variable income, I plan the timing of sales, harvested losses, and recognized income together, with an eye on capital gains thresholds and the net investment income tax. Done in isolation, these decisions often work against each other.
Multi-year, not single-year, thinking. The goal is rarely to minimize this year's tax in a vacuum. It is to minimize tax over your lifetime, which sometimes means paying a little more now to pay far less later. That trade-off is hard to see one return at a time.
It is worth being clear about how this fits alongside a CPA or tax preparer, because the two roles are complementary rather than competing. Your preparer's job is to file an accurate return for the year that just ended. My job is to position the years ahead: deciding how much to defer, which accounts to fill, when to recognize income or losses, and how those choices interact across your whole financial picture. For clients who have both, the most productive arrangement is one where the planning happens during the year and the preparer executes a return that already reflects good decisions, rather than discovering missed opportunities in April when nothing can be changed. When a client gives me permission, I will often coordinate directly with their accountant so the projection I build and the return they file are working from the same assumptions.
A Strategy, Not A Scramble
Keeping more of what you earn comes from a series of deliberate, coordinated decisions made throughout the year, fitted to your income, your goals, and the rest of your financial plan, rather than from a clever trick in April. For most people, the difference between filing and planning is the difference between accepting the bill and shaping it. Started early in a career and repeated every year, that shaping compounds into a materially different outcome over decades, often worth far more than any single year's refund, because the dollars you keep and invest today have the longest runway to grow.
For the consumer-facing version of this post, with the 2026 numbers and a year-end checklist, head over to Melby Money.
Most people who schedule a conversation with us have never worked with a financial advisor before. That is exactly who we work with. If you want a tax strategy that is coordinated with the rest of your financial life, schedule a tax planning session.
About The Author
Shaun Melby, CFP® provides fee-only financial planning and investment management services in Nashville, TN through his company Melby Wealth Management. Shaun has over 15 years of experience as a financial advisor in Nashville. Shaun created Melby Money to educate the public about finances.
Full Disclosure: Nothing on this website should ever be considered to be advice, research, or an invitation to buy or sell any securities. Please see the Full Disclosure page for a full disclaimer.