Daperis CPATax Planning for High-Earning W-2 Professionals
A high salary comes with a specific problem: most of the easy deduction and shelter strategies phase out right around the income level you've reached. Doctors, tech professionals, and other high earners end up overpaying not because they're careless, but because generic tax prep doesn't go looking for the strategies that still work once you're past the phase-outs.
Where High Earners Actually Overpay
If your W-2 income has grown past what standard advice accounts for, this is probably familiar.
Direct Roth contributions are phased out, and nobody explained the workaround correctly. The backdoor Roth strategy exists for exactly this situation, but it has a trap: old rollover IRAs from a previous job can silently wreck the math through the pro-rata rule, and most people find out after the fact, not before.
You have 1099 or side income on top of your W-2, and nobody set up a real retirement shelter for it. A solo 401(k) has contribution limits several times higher than an IRA, but it has to be set up correctly and before certain deadlines to actually work for a given tax year.
Equity compensation you don't fully understand the tax timing on. ISOs, NSOs, RSAs, and RSUs are all taxed differently, at different moments, and getting the timing wrong (or missing an 83(b) window entirely) can mean paying tax you didn't need to pay, or paying it at a worse rate than necessary.
You own a home and suspect you're missing deductions, but generic tax software doesn't ask the right questions about renovations, home sale exclusions, or renting out part of your property.
You bought a rental property assuming the losses would offset your W-2 income. In most cases, they can't. Rental real estate losses are treated as passive by default, no matter how hands-on you are, unless you qualify as a real estate professional, a test that requires more than half of your total working time and 750+ hours in real estate activities. That's nearly impossible to meet while working a full-time job elsewhere. There's a smaller allowance for active (not material) participation, but it phases out fast as your income rises and disappears completely well before most high earners' income levels.
How We Help
We build a plan around your actual income structure, not a generic high-earner checklist.
- Backdoor Roth done correctly. We check for old rollover IRA balances before converting anything, so the pro-rata rule doesn't quietly tax money you expected to shelter.
- Solo 401(k) setup for your 1099 or side income. If you have self-employment income alongside your W-2, we set up and time the right retirement vehicle so you're not leaving a much larger contribution limit on the table.
- Equity compensation planning. ISOs, NSOs, RSAs, and RSUs each trigger tax at different moments. We map out your actual equity so you know what's coming and when an 83(b) election is worth considering.
- Homeowner deductions, done properly. Renovations, the home sale exclusion, renting a room or a unit, we walk through what actually applies to your situation instead of a generic checklist.
- Real estate investment losses, evaluated honestly. If you own rental property, we tell you upfront whether your losses can actually offset your W-2 income, most can't, and walk through the real estate professional test and the smaller active participation allowance so you're not counting on a deduction that won't materialize.
- Charitable giving, structured to actually save you money. Qualified charitable distributions from an IRA, or bunching several years of giving into one tax year to clear the itemization threshold, can meaningfully increase what a donation actually saves you versus writing a check and hoping it helps at tax time.
How This Plays Out in Practice
A client had made a nondeductible traditional IRA contribution on someone else's advice, without realizing it was the wrong move for his income level. Instead of a workaround, the fix was increasing his pre-tax 401(k) contributions, which brought his income back under the direct Roth eligibility line and put more of his savings into a much higher-limit account at the same time. A small one-time tax cost today, in exchange for meaningfully more sheltered retirement overall than the mistake he started with.Fixing a Retirement Account Mistake Before It Compounded
Common Questions from High Earners
I make too much to contribute to a Roth IRA directly. Is a backdoor Roth actually worth it for me?
Usually, yes. The main risk is old rollover IRA balances triggering the pro-rata rule, which we cover in detail here.
I have 1099 income on the side of my W-2 job. What retirement account actually makes sense?
For most solo operators, it's hard to beat a solo 401(k). The contribution limits are higher than most accounts and your spouse can even contribute if they legitimately help in your business and are on payroll.
My company just gave me RSUs, or I'm about to exercise ISOs. What do I need to know before year-end?
RSUs are taxed as ordinary W-2 income on their vesting date based on fair market value, often requiring estimated tax payments to avoid underpayment penalties. Exercising ISOs creates no regular income tax at exercise, but holding the shares through December 31 can trigger the Alternative Minimum Tax (AMT) on the "spread." To secure favorable long-term capital gains rates rather than ordinary income rates, you must hold the resulting ISO shares for at least two years from the grant date and one year from the exercise date before selling.
I own my home. Am I missing deductions?
There are a few common ones if you itemize, like your property taxes and mortgage interest. As of 2026, private mortgage insurance is deductible again too, though that benefit phases out between $100,000 and $110,000 of AGI, so it may not apply once you're above that range. One that trips people up: the home office deduction only applies if you have self-employment or 1099 side income running through Schedule C. As a W-2 employee, that deduction isn't available on your personal return, even working from home full time, but if you're running a side business from part of your home, that portion may still qualify.
I bought a rental property and it lost money this year. Can I use that loss to offset my W-2 income?
Almost certainly not directly. Rental losses are treated as passive under IRC Section 469 regardless of your involvement, and can only offset other passive income unless you qualify as a real estate professional, which requires more than half of your working time and 750+ hours in real estate activities, a test that's nearly impossible to meet with a full-time W-2 job elsewhere. There's a $25,000 special allowance for active participation, a lower bar than material participation, but it starts phasing out at $100,000 of income and disappears completely at $150,000, which most high earners have already passed.
Do you work with clients outside Brooklyn?
Absolutely, the practice is virtual, and we work with high-earning professionals throughout NYC, the metro area, and beyond.
Let's find the strategies that still work at your income level.
Whether it's a backdoor Roth, equity comp, or a retirement strategy for side income, the process starts the same way: a free strategy session, no jargon, no obligation.