Insightful Talks at the 2019 Tax Savings in the Sand Conference

Financial Plannig
Photo by Pixabay from Pexels

Led by its president J. Todd Mardis, Capital Preservation Services is a tax planning firm that helps business owners benefit from qualified tax deductions. To further its mission, Capital Preservation Services holds an annual conference. It held its last conference between 11 and 13 July, 2019, at the Baytowne Conference Center in Destin, Florida.

The conference included numerous tax-related presentations delivered by accredited professionals. On July 12, Mr. Mardis welcomed everyone for coming and opened with a video titled, “The Tax Train is Coming.” Next was a presentation by attorney Walt Dallas on how changes to the tax code would affect CPS clients. CPA Renee Moore followed up with a discussion on record keeping and documentation for taxes. Other presenters that day included Mike Frascogna (intellectual property attorney) and Drew Fairley (CPA) who talked about effective marketing and 401(k) compliance respectively.

On July 13, Mr. Mardis opened the floor with an overview of captive insurance. Appraiser Joey Vegliacich was next. He explained to the audience how dwelling unit rental rate appraisals worked and even showed them how to use these units in their tax plans. Later that day, Mr. Mardis took to the stage for the last time and talked about private conservation easements for land purchases before wrapping up the conference with a detailed comparison of non-qualified deferred compensation plans and qualified retirement plans.

Backdoor Roth IRAs as a Tax Friendly Income-Saving Approach

Savings
Photo by Michael Longmire on Unsplash

Capital Preservation Services is a Flowood, Mississippi company that offers coordinated tax planning solutions for businesses and high net worth individuals. Client focused, Capital Preservation Services has developed tax savings strategies that meet the needs of professionals such as physicians, attorneys, and dentists.

High-income earners looking toward retirement may consider Roth individual retirement accounts, which allow tax-free savings of $5,500 annually ($6,500 for those over the age of 50). One limiting factor is that having a modified adjusted gross income of $120,000 ($189,000 for married couples) excludes the taxpayer from contributing to a Roth IRA.

One strategy around this is the backdoor Roth, which is suited to those who have already contributed the maximum to their 401(k) plan and are making full use of high-deductible health savings accounts as well.

As described in a CNBC article, the saver makes an after-tax nondeductible contribution to the Roth IRA that can be converted free of taxes. A caveat is that the backdoor Roth cannot be looked at in isolation from other IRAs that have pretax amounts contributed. In such situations, the IRS will use the pro rata rule in levying taxes on all of the IRA accounts. What this means is that the backdoor Roth must be carefully considered and may not be financially advisable when traditional, SIMPLE, and SEP IRAs have already been contributed to.