Tax Saving Solutions for High Income Earners
Tax saving solutions for high income earners
It’s extremely easy to reduce taxes 50% for 500k to 800k+ in income. STR’s + Seg Cost Study? DCP’s?
REP + Seg Cost Study?? Other biz asset depreciation? QOF’s?
Let’s break down the proven, IRS-approved strategies that routinely cut effective tax rates in half for high-income earners ($500K–$800K+).
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💰 1. Short-Term Rentals + Cost Segregation Study
• Why it works: STRs (average stays < 7 days) are not passive under §469 if you materially participate — no Real Estate Professional (REP) status required.
• Result: Depreciation and bonus write-offs from a cost-segregation study can offset W-2 or business income directly.
• Example: $1 M STR → $200K land / $800K building → $250K+ bonus depreciation in year 1 = $100K+ cash savings at top rates.
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🧾 2. Real Estate Professional Status (“REP”) + Cost Segregation
• Why it works: Qualify > 750 hours + > ½ of working time in real estate.
• Result: Converts passive rental losses into active losses.
• Combine with Seg Cost Study → write off massive depreciation vs ordinary income.
• Pro tip: Group rentals under one election for participation testing.
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💼 3. Defined Contribution Plans (DCPs) and Cash Balance Plans
• Why it works: Stack 401(k) + Profit Sharing + Cash Balance for $150K to $400K+ deductions annually.
• Who it fits: Doctors, attorneys, and self-employed owners with steady cash flow.
• Bonus: Employer contributions are deductible, and the assets grow tax-deferred.
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🏢 4. Depreciation on Business Assets & Vehicles
• §179 and bonus depreciation on equipment, vehicles (over 6,000 GVWR), and office build-outs.
• Pair with corporate management companies to shift income and layer deductions.
• Even short-life assets (3-, 5-, 7-year) can produce 6-figure deductions.
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🌇 5. Qualified Opportunity Funds (QOFs)
• Why it works: Roll capital gains into QOF within 180 days → deferral until 2026 + potential exclusion after 10 years.
• Example: $500K stock gain → invest in QOF real estate → zero tax on new growth.
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🧩 6. Advanced Entity Structuring and Income Shifting
• S Corps to save 15.3% SE tax via reasonable salary.
• C Corp for 21% flat rate and fringe benefits (health reimbursement, retirement funding, etc.).
• Multi-entity layering (LLC → C Corp → Partnership) to time income and accelerate deductions.
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🧠 7. Niche Plays Most Advisors Miss
• Conservation Easements (under IRS scrutiny but still valid if done right).
• R&D Credits for manufacturers, architects, builders, and software firms.
• Charitable Lead/Remaining Trusts to donate appreciated assets while retaining cash flow.
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📞 Call to Action
If you’re earning $500K–$1M and still paying over 35% in taxes, you’re leaving six figures on the table.
Call Darcy DeBlieux, CPA at US Tax Relief to build your custom tax minimization plan:
📱 1-844-4-IRS-FIX