Some people do not plan to minimize taxes after retirement. Some may enter retirement doing annual tax preparations as usual, and setting themselves up to pay taxes for the rest of their retired lives. That is because many CPAs and tax advisers don't do tax planning; they only do tax preparation. Most seniors understand that letting assets grow in a tax-favored environment will yield better results than assets that are taxable annually. But it's not the pre-tax amount that is as important as the after-tax amount. Moreover, some assets in taxable accounts do not really generate that much tax liability, assuming the investor gets good advice.
Plus, some men and women continue to do their own taxes in retirement, not realizing that different factors may need to be considered; or they don't think about using techniques like split annuities (described earlier) to minimize their exposure to taxes in retirement. Nor do enough seniors seek advice on how their accumulated assets are best paid out to themselves, to their spouses, and to their children and/or grandchildren when they die; or what IRS rules govern the payout of retirement assets; or the best way of using retirement assets to live comfortably while arranging for the support their surviving spouses; or how to leave the largest possible legacy to their heirs, with the smallest possible erosion due to estate and income taxes. Tax planning in retirement takes tax preparation to whole new levels!
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