Tax & Estate Planning in Denver, CO
Building wealth is only part of the journey – keeping it and passing it on efficiently are equally important.
Our tax and estate planning services in Denver help you preserve your wealth for the long run and create a legacy according to your wishes. We work closely with you (and in many cases, alongside your CPA or attorney) to integrate sophisticated tax strategies into your financial plan and to ensure your estate plan – wills, trusts, and beneficiary designations – are all in order. The aim is to minimize taxes where legally possible, both during your lifetime (income taxes, capital gains taxes) and at the transfer of your estate (though Colorado has no state estate, federal estate tax can be an issue for very large estates). We also want to spare your heirs unnecessary costs or delays, which a well-crafted estate plan can achieve by avoiding probate and clearly spelling out your intentions. These topics can be complex or even uncomfortable, but we approach them with sensitivity and clarity. By being proactive about tax and estate matters, you’ll gain confidence that you’re keeping more of your money working for you now and that your loved ones will be taken care of in the future.
Tax-Efficient Strategies
Tax planning is not just an April exercise – it’s something we consider year-round in your financial plan. Our team stays up to date on tax laws and looks for opportunities to reduce your tax bill both now and in retirement. Some of the strategies we might employ include: Roth conversions (converting part of a Traditional IRA to a Roth IRA in years when your tax bracket is lower, to generate tax-free growth thereafter), asset location (holding tax-efficient investments in taxable accounts and higher-yield investments in tax-deferred accounts), and strategic withdrawal sequencing (so you don’t get pushed into higher brackets unnecessarily when you start drawing income). We also advise on maximizing tax deductions and credits available to you. For example, if you’re charitably inclined, we might use a Qualified Charitable Distribution (QCD) from your IRA after age 70½ to satisfy Required Minimum Distributions tax-free while benefiting a charity. Or if you have appreciated stocks, we may suggest donating those shares instead of cash to get a full value deduction without paying capital gains tax. For retirees in Denver, we consider state taxes as well – Colorado’s flat income tax rate is relatively low, and the state offers a generous retirement income exclusion (for those over 55, up to $20,000 – and $24,000 for over 65 – of retirement income can be excluded from Colorado taxable incomesmartasset.com). We’ll make sure you take advantage of that. By being mindful of taxes at each decision, from investing to withdrawing to gifting, we strive to keep more money in your pocket (or your family’s) and less going to Uncle Sam.
Estate Planning & Legacy
Estate planning is about much more than money – it’s about peace of mind, knowing that your wishes will be honored and your loved ones provided for. As part of our services, we’ll discuss the key components of an estate plan and ensure you have them in place. This typically includes a will (to outline how you want assets distributed and who will care for minor children, if applicable), potentially one or more trusts (trusts can help avoid probate, manage assets for beneficiaries over time, or save on taxes in certain cases), a durable power of attorney (to designate someone to handle financial matters if you become incapacitated), and healthcare directives like a living will and medical power of attorney (to guide healthcare decisions if you cannot communicate). We’ll coordinate with your estate attorney or refer you to a reputable one if you need legal documents drafted. Our role as financial planners is to ensure your financial accounts and beneficiary designations line up with your estate plan. For example, we’ll regularly review who you’ve named as beneficiaries on IRAs, 401(k)s, life insurance, and annuities – these designations supersede a will and need to be kept up to date (especially after major life events like marriage, divorce, or a death in the family). We also look at titling of assets (joint tenancy, TOD designations, etc.) to make sure everything will transfer smoothly. If charitable giving is one of your legacy goals, we can incorporate that through strategies like donor-advised funds or charitable trusts, which can provide tax benefits now and impact later. And for business owners, we assist with succession and how your business interests fit into your estate. Ultimately, a well-crafted estate plan will spare your heirs from unnecessary legal hurdles, ensure that the right people inherit according to your desires, and could save a significant amount in taxes and expenses. We consider it our duty to prompt these conversations and keep your plan current as laws and life circumstances change.
Collaboration with Professionals
It’s worth noting that we don’t do all of this in a silo. We often collaborate with other professionals – tax advisors, estate attorneys – to execute the fine details of these strategies. For instance, if a complex trust is needed, an attorney will draft it, but we will be there to explain how it affects your financial picture and help fund the trust appropriately. If a unique tax situation arises (like selling a property or business), we’ll strategize with your CPA on things like installment sales or 1031 exchanges to defer taxes. By acting as the “quarterback” of your financial team, we make sure everyone is on the same page working towards your best interests. Our comprehensive view means nothing falls through the cracks. In the end, effective tax and estate planning is a gift to yourself and to your loved ones – it can mean more wealth to enjoy in life, and a smoother, more meaningful transfer of that wealth when the time comes.
FAQ
Do I really need an estate plan if I’m not very wealthy?
Yes – estate planning isn’t just for the ultra-wealthy. Even if you consider your estate modest, having basic documents in place is extremely important. A will ensures that your belongings (home, car, personal property, bank accounts) go to the beneficiaries you choose, rather than being distributed by Colorado’s default laws. A will also names guardians for minor children if you have them – a critical decision that you wouldn’t want left up to a court. Beyond the will, powers of attorney and healthcare directives are vital for everyone: these allow someone you trust to make financial or medical decisions for you if you’re incapacitated (say, due to an illness or accident). Without those, your family might have to go through a costly court process to get that authority. While it’s true that folks with larger estates or special circumstances might need more advanced tools (like trusts to manage assets or reduce estate taxes), the foundational pieces are beneficial for all. We often say estate planning is part of being responsible and loving to your family – it spares them difficult decisions and potential conflicts during an emotional time. We’ll guide you on what level of estate planning makes sense given your situation, but almost everyone needs at least a will, POA, and healthcare directive. It’s about peace of mind more than anything.
How can I reduce taxes in retirement?
Reducing taxes in retirement starts with planning before you retire and continues with smart decisions each year. Some strategies include: (1) Diversifying account types – Having a mix of tax-deferred accounts (Traditional IRA/401k), taxable accounts, and tax-free accounts (Roth IRA) gives you flexibility each year to draw from the most tax-efficient source. We often advise contributing to Roth accounts or doing Roth conversions in lower-income years so you have a bucket of tax-free money to use later. (2) Timing Social Security and RMDs – Delaying Social Security can increase your benefit and potentially allow you to draw down other accounts at a lower tax rate in the interim. Once RMDs kick in (currently age 73), they can bump you into higher brackets, so sometimes we do partial Roth conversions in your 60s to reduce future RMDs. (3) Strategic withdrawals – For example, you might withdraw just enough from an IRA to fill up a lower tax bracket and then use Roth or after-tax savings for additional needs, thus keeping taxable income below certain thresholds (like the one that causes higher Medicare premiums or taxes on Social Security). (4) Leverage tax deductions – Even in retirement, you can bunch charitable donations or medical expenses in one year to itemize deductions when advantageous. If you’re charitably inclined and over 70½, using QCDs from your IRA (direct gifts to charity) can satisfy RMDs without adding to your taxable incomestates.aarp.org. (5) Relocate or use state exclusions – Some retirees consider moving to more tax-friendly states, but since you’re in Colorado, note that Colorado already exempts a good amount of retirement income from state tax. We’ll ensure you claim that exclusion. In summary, reducing taxes takes a combination of planning ahead and annual review. Our team helps by running tax projections and working hand-in-hand with your tax preparer. Every dollar saved in taxes is a dollar more for you to enjoy or pass on, so we give this area careful attention.
Don’t let unnecessary taxes erode your hard-earned wealth, and don’t leave your legacy to chance.
Schedule a tax and estate planning review with Helping Hand Financial. From our Denver office, we’ll help you craft a smart tax strategy and ensure your estate plan is up-to-date and aligned with your wishes. This comprehensive review is part of our holistic planning process – we coordinate with your attorney or CPA as needed and make the process understandable. The first meeting is complimentary. Take action now to protect what you’ve built and gain peace of mind for the future. We’re here to make sure your money goes where you want it to, both during your lifetime and beyond.
