6 Tax Tricks Only the Wealthy Know

The U.S. tax code is complicated—and while it applies to everyone, the wealthy often have access to strategies and tools that significantly reduce their tax liability. At Walker Tax Relief, we believe everyone should understand how the system works so they can make informed, legal, and strategic decisions to protect their income and assets.

Here are six tax moves high-net-worth individuals use to stay ahead—and how they might apply to you with proper planning.

1. Use Trusts to Minimize Estate Taxes
High-net-worth families often use trusts to protect and transfer wealth. A properly structured trust can help:

Avoid probate

Minimize estate taxes

Control how assets are distributed

Common trust types include:

Irrevocable Trusts: Move assets out of your taxable estate

Charitable Remainder Trusts: Provide income during your lifetime while supporting a nonprofit

Grantor Trusts: Offer income tax benefits while maintaining control

Jennifer Walker, an Enrolled Agent and estate tax expert, can help you choose the right structure for your legacy.

2. Invest in Tax-Free Municipal Bonds
Wealthy investors often put money into municipal bonds for a reason: the interest is tax-free at the federal level, and often at the state level too. These bonds are issued by state and local governments to fund public projects—and they can provide a stable, low-risk income stream without increasing your tax bill.

3. Form a Family Limited Partnership (FLP)
An FLP allows wealthy families to transfer assets to children or grandchildren in a tax-efficient way. The senior family members retain control while gradually shifting ownership. This tool is especially effective for minimizing gift and estate taxes, and it can also provide asset protection.

4. Maximize Charitable Giving
Donating to charity can provide more than just a sense of purpose—it can also dramatically reduce taxable income. High-income earners can:

Deduct cash donations

Donate appreciated assets like stock and avoid capital gains

Create a charitable trust to combine philanthropy with estate planning

At Walker Tax Relief, we help clients align their giving goals with the most strategic tax outcomes.

5. Leverage Retirement Accounts for Tax Deferral
While everyone can use retirement accounts, the wealthy often maximize contributions and layer accounts strategically:

Backdoor Roth IRAs for high earners

Self-employed retirement plans like Solo 401(k)s or SEP IRAs

Strategic Roth conversions to reduce future taxable income

Jennifer Walker works with business owners and executives to create long-term, tax-smart retirement strategies.

6. Use the Mortgage Interest Deduction Strategically
The mortgage interest deduction allows homeowners to write off interest on up to $750,000 in mortgage debt. For those with luxury properties or second homes, this can translate into substantial annual tax savings—especially when combined with other itemized deductions.

Final Thought: Strategy Isn’t Just for the Ultra-Rich
While these strategies are often used by the wealthy, many of them are accessible to business owners, investors, and families who plan ahead. At Walker Tax Relief, we believe in transparency, education, and strategy. Let Jennifer Walker help you explore every available option to reduce your tax liability.

Based in Northville, MI | Serving clients nationwide
Ready to take control of your taxes? Contact Walker Tax Relief today.