Cynthia de Fazio 00:00
You Cynthia, welcome to Retire Smart Austin. My name is Cynthia DeFazio, joined today by Phil Capriotti, Sr. and Phil Capriotti, Jr. of Empower Wealth and Tax and to our viewers at home, as you know from the shows, we are very passionate about a retirement plan, of course, but also tax planning. It’s so important to have proper tax planning in your retirement years. And we started talking about this in a previous segment, previous episode, if you will, but we never got through the entire bulk of what we wanted to tell you, so, we’ve decided to keep going this week. Phil, how are you today?
Philip Capriotti 01:02
I’m wonderful. We got distracted. Parker came running in on set, but he didn’t have his cowboy hat on. Maybe tomorrow, tomorrow. That’s great. I’m very good, and it’s a pleasure to be here with my son, Philip. We don’t do enough shows together, but we’re going to soon change that he and our whole team in Cedar Park pretty much run the Cedar Park office. I’m spending more and more time out at the Horseshoe Bay office, which I absolutely love. We just opened up Georgetown and the Sun City office in the next 90 to 120 days. We figure sometime around November, around Thanksgiving, we’re opening up the Lakeway office. I already have two advisors trained ready to go. They actually live in Lakeway, by the way, if you are a financial advisor, by the way, the next office will be Dripping Spring, sometime around mid-2026, so I had advice given to me. I said, you know, Phil, you should open up offices in every area that the TV reaches and the radio reaches, because many of us live too far away to come in, partner to your Cedar Park office. So that’s exactly what we’re doing. So, with that being said with Philip and Eric and our whole tax practice there, we’re moving into a larger office of Cedar Park. We’re moving out of our 2500 square foot into a 4500 square foot office only about a mile away. So, it’s very exciting the growing and the changes, and it’s so happy to have family to help, to help the growth and to make this business a truly generational business. So, for those of you who have been watching for years, I just want you to know you’re not only working with me, but you’re working with my children who have been personally trained and mentored by me over the course of the last 10-20, years. So, with that being said, My son Philip, yay. We’re going to let him focus on much of the show today, because, you know, he’s, it’s, he’s probably one of the most intelligent children that I have. I know that. I knew that from when he was a little boy growing up, but he’s a little quieter than I am. He doesn’t really talk as much. But at any rate, I’m glad that he’s joining us and Cynthia, thank you for that great introduction to be here.
Cynthia de Fazio 03:34
Very blessed to be with both of you and Philip. I know you’re so passionate about helping your clients that are coming into the office, about not only planning properly for retirement, because that’s so important, but even taking it one step further, having a tax efficient retirement strategy, if you will, so that you can make sure you’re keeping the most of your client’s nest egg, of course. But here’s the thing, with having a proper tax strategy, would you agree? Does it help protect against legislative risk, just in case there’s any changes down the road, legislatively.
Philip Capriotti, Jr. 04:04
Oh, yeah, absolutely. I mean, we just had a major change to the tax law, and there can always be major changes in the future. So, our financial planning tool that doubles as a tax planning tool, you know, is built by tax attorneys and certified financial planners and these folks that stay up to date and in tune with the current tax laws and also future tax changes in the future.
Cynthia de Fazio 04:29
Okay, perfect. Thank you so much. Phillip, I want to ask you, Phil, does it actually help minimize capital gains taxes when you have a tax efficient strategy?
Philip Capriotti 04:39
Yeah, especially this new software that we’re using. We’ve been using it quietly on the QT over the last two years. But the fact of the matter is, doing tax loss harvesting 20, 25, 30 times a year, what it does is it significantly reduces short term capital gain the tax. On short term capital gain and long-term capital gain. Many folks, and I see this a lot, especially with my high-net-worth clients, they’ll come in and they’ll say, Can you fix this? And they’ll bring their tax return, and I’m looking at long term capital gains and dividends and interest. We’re looking at long-term and short-term capital gains tax that are causing them, you know, 100,000, 70,000, 80,000, 200,000 depending on the size of the portfolio. And I’ll ask them, where’s your tax advisor, your financial advisor? Does he talk to you, or does she talk to you about this? And I always hear the same thing, no, they just telling me, You know what? They tell me, I’m saying, What? What do they tell you? Well, Phil, they tell me, why are you complaining about paying so much in taxes when you’re making so much in earnings on the portfolio, we’re managing for you? And I just kind of what, pardon me, what? Yeah, wait a second, what do you mean? So, because we’re producing double digit returns, you should just automatically feel comfortable with paying double digit taxes on those returns. So again, the tax planning and the retirement planning, and even if you’re prior to retirement, we have folks now coming in. They’ve sold businesses and haven’t done proper tax planning. So, we want to look at, I don’t care if you’re 40, 50, 60, or 100 okay, we always want to take a look at your financial plan. With respect to Phil, am I paying too much in taxes? Can you help me reduce my tax liability legally by some of the- with some of the strategies that you that you talk about on your TV show? And the answer is, Y.E.S., yes. Yes.
Cynthia de Fazio 06:54
Absolutely, yes. So, Philip, I should ask you a question. What about leveraging tax smart gifting? A lot of people want to gift their funds. Talk a little bit about that.
Philip Capriotti, Jr. 07:04
Yeah, yeah, absolutely. So yeah, there’s qualified charitable donations or distributions that can really be helpful when wanting to donate your RMD to a charity or some charitable organization, and you can actually start doing those before you reach RMD age. In many cases, you can start the year that you turn 70 and a half. Okay? So, a lot of people don’t realize that. So, it’s very important to work with a financial advisor that is also a tax advisor.
Cynthia de Fazio 07:36
Absolutely. It makes perfect sense, especially if you’re charitably inclined. Most definitely. Well, Phil, I want to ask you, oh, you’re gonna say something else, I can see.
Philip Capriotti 07:45
I was going to say for super high net worth clients, and we have quite a few, we may want to look at irrevocable, irrevocable trust. Oh, we may want to place assets in an irrevocable trust to get them out of our estate, not for income tax purposes. For estate tax purposes, many folks think it’s all about just federal income tax. I would add, in addition to federal income tax, we really want to look at estate tax, federal estate tax, because this is also known as the death tax. So, by doing that, we can construct certain types of trust that literally eliminate the assets out of your current estate and transfer it into either your children and or generational skipping your grandchildren. So, this is all part of, excuse me, tax efficient estate planning techniques, which really revolves right around tax planning, tax efficient retirement planning. It’s not just about the retirement. It’s about the estate as well. I would say most definitely. Again, if your financial advisor is not discussing this with you, maybe they simply, they may not lack personality, because you like them and they’re a good advisor. Maybe they simply lack tax knowledge.
Cynthia de Fazio 09:04
Most definitely Well, Phil, I want to ask you the next question, but we’re going to take a very short commercial break, so I’m going to hold it. But first of all, special message to our viewers at home, take it away.
Philip Capriotti 09:13
Oh, oh, sweet Lord have mercy. It’s good to be with you folks again. I’m not even going to say, call 888-818-6557, because I know you’ve heard this number over and over again, what we’re noticing is about 80% of you are clicking the QR code. And many folks I’m seeing folks that called the show, and I’m getting to see them the following week because they hit the fast track, yes, and they’re like, I have a serious tax issue, my accountant filed an extension. And every single year, my accountant files an extension because we’re waiting for a K1 is there anything that we can do about that? I’ll tell you about it in the next segment but click the QR code go to empowertaxbill.com and/or Empower Legacy Quiz at empowerrothquiz.com and hit the fast track. Answer a few questions, and our team of licensed professionals will call you tomorrow and we’ll structure you with, we’ll schedule an appointment with the right advisor, okay, depending on your net worth and what type of tax issue you have. You know now we’re doing these workshops, and I’ll talk about in the next segment, estate planning workshops. It’s important to have that as in your as part of your tax efficient retirement income plan.
Cynthia de Fazio 10:33
Most definitely. Phil, thank you so much, Phil. Thank you so much to the viewers at home. I’ll give you the number. It’s 888-818-6557, but as Phil mentioned, to get on that fast track, go ahead, grab your smartphone, click on the QR code please. At the bottom corner of your screen there, you’re going to find a few questions, and you’ll answer them, and then find out where you stand for your retirement. And do you have a tax plan? Most specifically, we’ll be right back on Retire Smart Austin. Don’t go anywhere. I have so much more with Phil and Phil. Stay tuned.
Philip Capriotti 11:05
Hello, folks. Think estate planning mistakes only happens to celebrities? Think again. Prince, Aretha Franklin, and even Ted Williams all left behind estates without a proper plan, leading to years of legal disputes and financial loss for their families. These mistakes aren’t just for the rich and famous. Without a solid estate plan, your assets could be tied up in probate subject to higher taxes or even end up in the wrong hands. The good news, these mistakes are avoidable. A well-structured estate plan ensures that your assets go where you intended, with minimal hassle for your loved ones. Have you reviewed your plan recently? Do you know how tax laws impact your estate? Don’t let your legacy become another cautionary tale.
Cynthia de Fazio 12:01
Welcome back to Retire Smart Austin. My name is Cynthia DeFazio, joined today by Phil Capriotti, Sr. and Phil Capriotti, Jr. of Empower Wealth and Tax and we’re talking all about the importance of having a tax efficient retirement plan. Well, gentlemen, I love the fact that we mentioned the workshops. Let’s talk a little bit more about the workshops. Phil, where can people find them, and what goes on inside the workshops?
Philip Capriotti, Jr. 12:25
Well, we do a lot of workshops around the Austin area. I do workshops in Pflugerville and Cedar Park and Georgetown and all over the area. But, but, yeah, all you know quality educational material. What we want to do is we want to educate our clients as much as humanly possible about their current tax plan, their current portfolios, and then we can look at, you know, other options as well, and how we would allocate and manage their financial plan and their tax plan.
Cynthia de Fazio 12:55
That’s fantastic. And the workshops are complimentary. Yes, amazing.
Philip Capriotti 13:00
We hold most of the workshops in the public library or the Chamber of Commerce. I’m a firm believer, if a client wants to come to a workshop and spend their time at a library or at a college, it’s for knowledge. It’s not for dinner. It’s true. Okay, most folks that that need a comprehensive, tax efficient retirement plan can afford to buy their own dinner, okay? But they’re but they’re little short on knowledge. So, the workshops- we normally have three to four workshops a month.
Cynthia de Fazio 13:34
Wow, that’s fantastic.
Philip Capriotti 13:35
Yeah, we do between 40 and 50 workshops a year. Now my son Philip does them. I do them. We have other advisors that also do them. I used to do them all, until my son Philip came in and said, Dad pop, let me help you out here. And I’m like, great. I’m really happy. We talk about Social Security and different maximization strategies based on different individuals’ income. We talk about estate planning now. As part of our workshops, I have our Estate Planning Attorney that works with us very closely come in and discuss trust, whether you need a trust, whether you need a will. What’s the difference? We talk about tax efficient retirement income planning, and then we come up with real life situations, case studies on clients. The- an example of a client that will retire tax free, getting 120,000 or 150,000 a year, and a client that will not. So, we’ll do case studies. Case Study one, a non-efficient retirement income plan, as opposed to case study two and even three. So, the workshops last about an hour and 15 minutes, no more than an hour and a half. Anyone that participates in the workshop, comes to the workshop, has three complimentary interviews at our office. They have a social security and retirement planning That’s strictly complimentary. They have a Morning Star Report and Portfolio Observation review, strictly complimentary. And then we also have an Estate Plan. We’ll give them an- a will, send them a- an estate planning questionnaire so we can look on whether they need a Will or Trust. There are no other advisory firms that provides that level of service complimentary to their folks. So, whether you watch us on TV and click the QR code, or if you’re if you want to sign up for one of our workshops, I would say, go to our website. There’s a list of all of our workshops, and like I said, you can come to one of these workshops. We’re doing a lot. You know, originally, we used to do one a month, and now we do pretty much just about one every 10 days.
Cynthia de Fazio 15:48
Yes, that’s incredible, because people obviously need the information. They’re starving for information.
Philip Capriotti 15:55
There will be more baby boomers retiring in the next five years than ever in the history of the planet. So that’s the next five years. It’s heavy-duty retirement, and this is why, this is why our office is growing so quickly. Most definitely, there’s a lack of planning, there’s a lack of education, and so we want to be in the forefront of that, wouldn’t you agree, Phil?
Philip Capriotti, Jr. 16:21
Oh, yeah, absolutely.
Cynthia de Fazio 16:23
Most definitely, and proper tax planning. Phil, I should ask you, does that help minimize Medicare premiums like IRMA?
Philip Capriotti, Jr. 16:29
Yes, absolutely, a very popular Roth conversion strategy to not go into the next IRMA bracket, which causes additional taxation on your Medicare Part B and D premiums.
Cynthia de Fazio 16:42
And a lot of people don’t realize that, so I’m glad that we’re talking about it today, because that’s the last thing that you want to see, correct?
Philip Capriotti 16:49
Well, one of the softwares that Philip uses, and I also use, is a software to create that retirement income plan so that you don’t enter that extra IRMA tax in retirement, because most people bump up the IRMA right after the death of spouse. Number one, because now you go from married filing joint to fall single, well that reduces your income threshold to jump into you could pay $185 a month for part B and/or part for the Part B premium, or you can pay up close to $700 a month. So, if not paying attention to that, IRMA, if that’s not part of your retirement income plan, Phillip pointed this out to me years ago. He said, Dad, we got to start focusing on individuals. IRMA, when we structure the RMDs. And I looked at and I said, son, you’re absolutely right. Let’s start putting that as part of the and so he went out, did the research, and he said, I got just the software for that. Let’s implement it for our clients into the plan.
Cynthia de Fazio 17:53
That’s fantastic, Philip, that’s amazing. I’m so glad that you did that. I mean, obviously we talk about the importance of having a tax strategy, how it benefits estate planning. Let’s do a deep dive into that. How does it help estate planning overall, Phil, using a tax plan?
Philip Capriotti 18:09
Well, you know, part of estate planning has to do with number one, your taxes today, for your current you and your spouse, but taxes in the estate right now. One doesn’t realize that the larger your estate, the more for an estate tax plan. Many folks just think it’s income tax plan, but we look at estate tax plan right now. Thank God that this current, thank God that the election didn’t swing the other way, because we would have seen the expiration of the tax cuts and Jobs Act. Everyone, not just millionaires and billionaires, would have gotten a rate- tax increase January 1, 2026 of 20% minimum, and that includes folks in the 10% and 12% bracket. But not only that, they would have also we would have relinquished, relinquished our estate tax threshold to anything over 5 million would have been federally estate tax included. In other words, if you had an estate of 6 million, the exclusion would be on 5 million, and then that extra million, you’d have to pay a 50% tax on anything above that 5 million. It’s now 15 million, but again, that sunsets as well. So, part of the estate tax plan has to be part of your retirement tax plan for business owners, for ranchers, for farmers, for folks that you that have again worked hard and paid taxes their whole life. So, we like to create balance. By the way, folks, not everyone needs an estate tax plan, but for those of you who do, we’re the folks to come and see to help you implement that.
Cynthia de Fazio 19:55
Phil, thank you so much. Phillip, thank you so much to our viewers at home. The number to call is on your screen. 888-818-6557, we’re talking about how important it is to have a proper tax strategy for your retirement years. And if you’re in the viewing audience and you realize I’ve not thought about that, this is brand new to me. This is the perfect opportunity to go in. Go ahead and call in today. 888-818-6557, as Phil mentioned before, to get on the fast track. If you really need immediate service, please grab your smartphone, click on that QR code at the bottom corner of your screen that takes you right to the landing page of Empower Wealth and Tax and you can schedule your time accordingly if you’re just curious, if you’re in the right avenue for legacy planning, please visit empowerlegacyquiz.com you’ll be asked a few questions, and you’ll be surprised, I think, by the answers. We’ll be right back momentarily on Retire Smart Austin, stay tuned.
Philip Capriotti 20:57
You know, folks, as individuals, we strive for better from a better house to a better career to a better life for our kids, but when it comes to your retirement, What Does better mean to you? More income, a flexible lifestyle, better solutions. A better retirement begins with a customized plan for you and your family that highlights your goals and objectives in retirement. So, to get your complimentary written financial plan, call us at the number you see here. You only retire once, so this is your opportunity to plan for better. Thank you very much. And have a blessed day.
Cynthia de Fazio 21:42
Welcome. Back to Retire Smart Austin. My name is Cynthia DeFazio, joined today by Phil Capriotti, Sr. and Phil Capriotti, Jr. of Empower Wealth and Tax and we’re talking all about your retirement plan, of course, but also making sure that it’s tax efficient by using the right strategies. Philip, you’re very passionate about helping people with capital gains talk a little bit about that by implementing some proper tax strategies when it comes to capital gains taxes, if you will.
Philip Capriotti, Jr. 22:10
Yeah, you know, a lot of the tax planning that we do revolves around capital gains because we’re doing Roth conversion planning, and we’re trying to estimate future taxes or future income, right? So doing estimated tax returns in the future, very important, but doing them now is also extremely important too, while we’re in the tax year and we can have something to do about it.
Cynthia de Fazio 22:35
Okay, perfect. And you wanted to actually dive in a little bit further to IRMA, because we kind of skipped over it, and so many people were probably leaning in. So, talk a little bit about that.
Philip Capriotti, Jr. 22:45
We did. We did, yeah, so when we’re trying to calculate what the IRMA is, or an increase in Medicare Part B premiums, there’s several different tiers, right? You have the first tier, the second tier, third tier, fourth tier. So, when we’re doing Roth conversion strategies, we want to make sure we’re looking at those tiers, because they do not follow marginal income tax brackets. They’re totally different.
Cynthia de Fazio 23:07
Okay? And a lot of people are unaware that that can be affected through Medicare. Correct?
Philip Capriotti, Jr. 23:11
Yes, an increase in the Medicare Part B premium, which also in most cases, reduces folks’ social security check, because they have that premium getting deducted on a monthly basis in most cases.
Cynthia de Fazio 23:24
Perfect. Phil, thank you so much. And Phil, you mentioned something in one of the prior segments about people that have the K1 can we talk a little bit about that and how it benefits having tax strategy, please?
Philip Capriotti 23:34
Yeah, I’ve had literally dozens of folks they’re unhappy with their accountant and again. And this is why many times they’ll get late K1, they’ll get K1’s that don’t come in until August, September, October. I’ve had them come in as long as November, pardon me. And the CPA says, Well, we’re just going to file an extension. And I’ve had folks say, I don’t like to file an extension, right? I believe it’s a red flag for an audit. So, what I tell folks is, say you make a valid point. Can you do things different, like, of course, of course, we look at all of the different avenues. How about we file your tax return on time, okay? And when the camel end comes in, we’ll file an amended return, complimentary. How about, let’s doing that, and they’ll look at me and say, I have no idea why my accountant didn’t suggest that. I said, Well, probably because it’s more work. Don’t be afraid to do the heavy lifting, is what I say. If you’re an accountant, a CPA, if you’re a tax prep, don’t be afraid about doing extra work. Make your client happy, make sure they’re not tossing and turning at night, worrying about doing an extension and how that may be a red flag for an audit. That is what I would say. So just a piece of advice we normally do is very, very simple, okay, we simply file your tax return with all of the documents that we have, and then later we’ll do an extension, and we without an extension, and then later we’ll do an amended return. When the K1 comes in rest peacefully. It’s extremely important that you do, and this is all part of customer service. Do the heavy lifting, do the work. Treat your client like you want to be treated, and you’ll never go wrong. And I’ve taught this value with my children and many folks, even the advisors that I work with, and you’ll never be disappointed. And I would say to clients, if your current CPA is always filing extensions, guess what, give us a call. Click the QR code, Fast Track. Come in with your tax return. We’ll take a sp- put a second set of eyes. Chances are, if they missed that strategy, they could be missing others.
Cynthia de Fazio 26:01
Oh, I’m sure it makes perfect sense. Philip, I want to ask you as well, what about the avoidance of tax surprises when you’re doing proper tax planning? Talk a little bit about that. Because without a tax plan, you’re just wide open to whatever comes your way without having a strategy.
Philip Capriotti, Jr. 26:17
Right, and a lot of people are always surprised with their tax return because they don’t do the proper tax planning. But once you start working with an advisor that specializes in tax planning, and you see the benefits that come to the retirement plan with the tax planning, you’re not going to mind so much talking about taxes like before.
Cynthia de Fazio 26:37
Most definitely. And Phil only about a minute left of the show, final words of wisdom to the viewers at home.
Philip Capriotti 26:42
Folks, I would tell you right on out, if you have taxable portfolios or joint portfolios that are not qualified, that are not in IRAs or Roth IRAs, and you’re getting huge capital gains or dividends and interest that you’re paying into that you’re paying taxes on each year and not spending. Come on in and get a second opinion. Understand, ask your advisor, is it possible to do tax loss harvesting every week or every two weeks? And if your advisor says no, you’re with the wrong advisor, because we can signif- we can literally bring capital gains tax down to zero with the right plan.
Cynthia de Fazio 27:23
Wow. Phil, thank you so much. Phil, thank you so much to the viewers at home, the number to call is on your screen, 888-818-6557, but most importantly, how do you get on the fast track? Well, grab your smartphone, click on the QR code at the bottom corner of your screen. That takes you right to the landing page of Empower Wealth and Tax you can schedule your time accordingly. Be safe, be happy and be blessed. Most of all, we’ll see you back one week from today on Retire Smart Austin. Take care now.
Philip Capriotti 27:51
Thanks, Cynthia,
Cynthia de Fazio 27:52
Thank you, Phil.