At a recent webcast, From Income to Impact: Advanced Tax Strategies for the High-Net-Worth Investor, experts from LPL Financial and VettaFi explored the sophisticated maneuvers required to preserve wealth in an era of mounting tax complexity.
The discussion, featuring Cody Parks, vice president of advanced planning high-net-worth services at LPL Financial; Evan Wrinkle, senior analyst of tax planning at LPL Financial; and Todd Rosenbluth, head of research at VettaFi, reinforced a fundamental shift in the advisory mandate. Being a portfolio manager is no longer enough. Today’s high-net-worth (HNW) environment demands a “tax-first” lens — integrating cash flow, long-term philanthropic goals, and estate planning.
With tax rules constantly changing, the biggest opportunity for advisors isn’t always market performance. It’s smart tax planning.
Moving Beyond the Rearview Mirror
Much of the conversation centered on shifting from reactive compliance to forward-looking strategy. For many HNW families, tax season has long been a backward-looking exercise in damage control. Parks noted that the real opportunity lies in the months leading up to liquidity events.
“Proactive planning is where it’s at,” Parks said. “CPAs are kind of dropping the ball on that one, so financial advisors especially have a great opportunity to pick it up there.”
CPAs tend to focus on the past year’s tax bill. Advisors, by contrast, can plan several years ahead. And with estate tax exemptions near $15 million per person, the bigger pressure point for many clients today isn’t estate tax — it’s capital gains and income taxes.
Parks also emphasizes that effective tax planning requires a complete view of a client’s situation: assets, business interests, real estate, charitable goals, family dynamics, succession plans, liquidity events, and investment strategies. It involves identifying key milestones (like selling a business or retiring) and balancing short-term tax costs with long-term optimization. In his view, advisors’ strong client relationships make them best suited to guide those complex, forward-looking conversations because their work is built on deep, ongoing client relationships.
See More: Advisors Brace for Major Retirement Policy Shifts in 2026
Tailoring Strategies to HNW Personas
Parks identified five investor personas that need specialized guidance to safeguard their assets
- Corporate Executives: Senior leaders with compensation heavily tied to stock options, restricted stock units (RSUs), and concentrated company stock positions often want to diversify, generate cash flow, and reduce concentration risk while managing the tax impact of exiting long-held properties. Wrinkle highlighted the 83(b) election as a time-sensitive tool to lock in lower valuations. For those seeking diversification without a tax hit, exchange funds and Section 351 ETFs can rebalance portfolios while deferring gains.
- Real Estate Owners, aka the “Dirt Rich” Investor: Many real estate investors are high in assets but low in liquidity. Deferral strategies allow these clients to transition into diversified income streams without surrendering a third or more of their equity upfront. They often want to diversify, generate cash flow, and reduce concentration risk while managing the tax impact of exiting long-held properties.
- The Business Owner: This includes entrepreneurs focused on running and growing their businesses but often overwhelmed by tax complexity. They struggle with decisions like S Corp vs. C Corp structure. They also may unintentionally leave deductions — such as the Qualified Business Income deduction — on the table. Many are looking to reduce taxes, create operational efficiency, and eventually pass the business on to their children. This also includes established owners preparing for a future sale, focused on maximizing after-tax proceeds. They evaluate stock vs. asset sales, entity structure, and long-term exit timing to position themselves for a major liquidity event. Their planning centers on optimizing value, minimizing taxes, and preparing for the lifestyle and legacy decisions that follow a successful exit.
- The Surviving Spouse: Often uninvolved in day-to-day financial matters, the surviving spouse may unexpectedly inherit significant wealth and complex structures. Overwhelmed and unsure where to start, they need clarity, simplification, and coordinated planning. The priority is creating confidence, organizing assets, and developing a sustainable long-term financial strategy.
- The Multi-Generational Family: These beneficiaries inherit wealth through trusts, IRAs, and other qualified accounts designed for tax efficiency. While often labeled “trust fund babies,” they are typically navigating complex distribution rules and fiduciary structures. Their planning focuses on responsible wealth management, tax-efficient distributions, and preserving family wealth across generations.
While each persona looks different on the surface, the planning themes are consistent. No matter the profile, the conversations tend to center around aligning legal, tax, and investment strategies under one coordinated plan.
Defining High-Net-Worth vs. Ultra-High-Net-Worth
There isn’t a universal definition of high-net-worth (HNW) or ultra-high-net-worth (UHNW). Different advisors, firms, and industries use different thresholds, and that flexibility is generally accepted.
That said, common benchmarks often look like this:
- Around $5 million in net worth is frequently considered high-net-worth.
- Somewhere between $10–20 million is often labeled ultra-high-net-worth.
In estate planning specifically, the definition tends to center less on a label and more on exposure to estate tax. Once a client’s net worth approaches $20 million or more, estate tax planning typically becomes a primary concern.
Ultimately, the numbers vary by context. However, the key distinction usually comes down to complexity — particularly tax exposure, estate considerations, and planning sophistication.
Beyond the Balance Sheet
While the technical maneuvers discussed — from QBI optimization to 83(b) elections — provide immediate relief from tax erosion, they are only the foundation. As Parks later noted, for the truly high-net-worth client, the conversation eventually moves past “How much can I keep?” to “What kind of mark can I leave?”
The webcast was packed with insights, and this tactical overview is only half the story. In Part 2 of this pair of articles, the panel pivots from personal income optimization to the art of legacy building. We will explore more charitable tools like remainder trusts and donor-advised funds that can support both tax savings and philanthropic goals, how Roth conversions can lower lifetime taxes and strengthen estate plans, and the shifting regulatory landscape that will define the Great Wealth Transfer in 2026 and beyond.
Originally published on Advisor Perspectives
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