Unlock the secrets to keeping more of your hard-earned money with tax planning strategies that are not reserved for the rich and famous. Financial guru Jason Runung, from our Denver office, joins us to demystify the world of taxes and demonstrate how proactive planning can benefit everyone, from the salaried employee to the serial entrepreneur. Brace yourself for an eye-opening discussion that promises to transform the way you view your financial blueprint. We're not just talking deductions and credits; this is about shaping your financial destiny, one tax year at a time.
Tune in and learn how to turn tax planning into a powerful tool in your financial arsenal, ensuring that when it comes to your money, you're making all the right moves.
Here is more about Jason:
Jason is a Senior Financial Advisor in the Denver, CO office and Vice President of Summit Wealth Group. His work experience has been focused in the financial services industry since 2006. He held positions as a Financial Advisor in both a national firm, as well as an independent Registered Investment Advisor (RIA). Additionally, he participated as the Director of Business development for a private equity firm and an Advisor Relationship Manager for a national custodial institution.
Jason received his Bachelor of Science degree in Economics from Texas A&M University. He holds the FINRA Series 7 and 66 securities registrations and he is a registered representative with Commonwealth Financial Network® (a registered broker/dealer, member FINRA/ SIPC).
Throughout his career Jason has helped young professionals and families establish day-to-day habits and plans that will impact the entirety of their financial future. They are often surprised at his ability to interpret, analyze and translate complex financial concepts in a way that helps them feel comfortable and secure about their finances. By delivering an approachable and comprehensive plan, Jason helps clients clarify the path to their goals. He has assisted mature couples by confirming their diligence and persistence have paid off and they are ready to retire. And he has helped small business owners review their current operations, the impact on their personal standings, and how to take care of themselves, as well as their employees and clients in the long run.
Being an active member of his community is a passion of Jason’s, having previously helped establish and coach the Four Corners Rugby Club and San Juan Spartans Rugby Club of Farmington, New Mexico. Additionally, he has been active with Habitat for Humanity, Big Brothers Big Sisters of America and a board member for the Institute for Attachment and Child Development. He is a current member of Sons of Norway. However, Jason primarily focuses on spending time with his wife, Kendra and daughters, Ava and Anya, but also enjoys cooking, playing rugby, snowboarding and taking advantage of his private pilot’s license given the opportunity.
Securities and Advisory Services offered through Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. Fixed insurance products and services are separate from and not offered through Commonwealth Financial Network®.
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Jessica :
Welcome to the Reach your Summit podcast, where we help you navigate the path to a better, more secure future. We are brought to you by Summit Wealth Group and I am your host, Jessica Magnuson. I am joined today by one of our advisors out of the Denver office, Jason Runung, so thank you so much for being here, Jason.
Jason:
Thank you for having me.
Jessica :
For our listeners that don't know you or are not in the Denver area, can you give us a little brief introduction of who you are?
Jason:
Again. My name is Jason Runung. I'm a financial advisor here in the Denver Tech Center and I am a CFP and a financial advisor. I've been a financial advisor for the past 18 years now. Focusing heavily on individual tax strategies and business tax strategies is an area of my expertise.
Jessica :
So it is April and hopefully, if you are really together, you have all your taxes done already and finished and filed. But for many people, the tax deadline is approaching. Now, most of the time, I feel like when people hear the topic of taxes, they're like I don't want to talk about this, I don't like taxes, let's not go there. But if I've ruined anything from working at Summit, there are a lot of proactive things that you can be doing to make this season a lot less stressful when the time comes. So what it's commonly known as in the financial realm is tax planning, and I didn't even know this was a thing before I started working here. So, Jason, can you give us a brief overview of what is tax planning?
Jason:
You know, Summit's unique in this space in that we actually were founded on a crossover effort between tax planning and CPAs and CFPs and financial planners.
Jason:
That's really where the heart of the company came from was this heavy involvement in accounting, bookkeeping, tax planning and how it overlapped with financial planning and investments and all those types of things. And so tax planning really is nobody's trying to pay more taxes per se, so that's not generally the strategy. Tax planning is just being the most efficient that you can be with your taxes and not paying more than you have to. So you want to follow the rules of what's out there, but you want to know what all those rules are. You want to take advantage of any opportunities that you have that you can and make sure that you're making use of any of those opportunities and trying to minimize your taxes in an appropriate way, and you want to do that proactively rather than reactively, and that's one of the things we've seen is that a lot of people kind of just show up with the documents at the end of the year and say well, you hand them off to your tax person.
Jason:
Here it is. I've already done everything that I can do or everything that I was planning on doing. Let's go ahead and do my taxes. Alternatively, we try to go ahead and do or tax planning is a little bit more proactive, where you focus on right now, here in April. What can you plan for next April? What things can you do over the course of the next 12 months that will help to limit that tax consequence and make sure that you're putting yourself in the best situation possible from a tax perspective.
Jessica :
You're exactly right. People definitely don't want to pay more than they have to for taxes, so it seems like a pretty great thing to be aware of and be working on. So when people come in to talk to you about their overall financial picture, do you feel like they have any kind of misconceptions or misunderstandings about what tax planning is or what they're supposed to be doing with tax planning?
Jason:
I think generally there seems to be a little bit of a perception that the standard normal individual who's working at a job receiving a W-2 wage can manage their taxes through a lot of intricate strategies. That's really not generally the case. There are things that you can do to control your taxes. There's ways that you can contribute or donate or increase your deductions or do any of those types of things. Those are things that you can do, but really most normal people don't have the opportunity to introduce deductions and do those types of things on a regular basis. Really, where you see that is if you're some type of business owner. That's where it starts to come in to play that you can be a little bit more strategic.
Jessica :
You had mentioned that this is like a proactive thing, so this is something that you could be talking with your financial advisor about year round and working on things, not just something that happens at the beginning of each year, correct?
Jason:
Well, you said could, and I would take it a little bit further and I say should. So you should be talking about these things on a regular basis and it should be a normal conversation and you can determine early on in a relationship with a financial advisor whether or not you're in a situation where you keep an eye out for additional opportunities like this or not. That's going to be determined pretty quickly, or should be determined pretty quickly. Really, you do want to engage in that pretty early on in the relationship and your advisor should be talking to you about what it is that you can do over the course of the next year, the next 10 years, the next 20 years, as you transition into retiring or selling a business or any of those types of things. Those are situations where you want to plan for them well in advance.
Jessica :
That kind of makes me think of, maybe when I was I don't need, like, anyone to do my taxes, I don't need anyone to tax plan for me, like I don't have enough going on. So how would someone know that they're at a point in their life where this would be something beneficial to really seriously talk with someone about, even if they feel like I don't really? You know, I have my job and that's it.
Jason:
So if you used TurboTax last year and it took you 20 minutes to file your taxes, then you don't need advanced tax planning. But beyond that, you probably would benefit from it. It's kind of the general rule that I would say there, because you're describing a situation there You're talking about just out of college and you have one slip of paper and you enter this one slip of paper in and then you just plug your information in. There's not a lot to that. That's where you need a financial advisor who says, okay, we'll put some money into an IRA or put some money into a different type of account in order to save for your future. But other than that, like it doesn't get very complicated because there's not a lot to it. Frankly, if you start looking at multiple documents and so then you're looking at five or six or seven documents and you start getting up into that realm then it becomes much clearer that you do want to have somebody else put a second set of eyes on it.
Jessica :
So would this be things like you have purchased a home, you've had children, you are maybe something career-wise is big happening for you, like these are instances you might want to ask and see like should we be planning something with our taxes here?
Jason:
The introductory one would be relocation for work, for example.
Jessica :
That would be a very open one.
Jason:
So that's one of the first things that you do before marriage and kids really is that you might find yourself moving around and doing those types of things. That's where you can do some tax planning. As you move into a situation of marriage and home purchases, moving into new jobs and things of that nature, that's where you start having more and more opportunities for tax planning. And really where you are as far as if you're starting off your first job, then you probably are less inclined to need a lot of tax planning versus between your first job and your second job. So between your first job and your second job there's opportunities, typically more opportunities than you would see before.
Jessica :
Oh, that makes a lot of sense. Looking at a full financial picture, how does tax planning you had mentioned kind of like if you're looking to retire and I think retirement planning is something that a lot of people hit a certain point in their life and they're like we need to plan for our retirement. So how does tax planning and retirement planning intersect?
Jason:
They don't intersect, they run next to each other. I mean, they're parallel with each other. They run almost as one simultaneous thing.
Jason:
When you think of tax planning, effectively, what you're doing is you're reducing your taxes, and so if you're reducing your taxes in some capacity, then that's increasing the amount of money that you have, whatever that is.
Jason:
So it could be a lot, it could be a little bit, whatever it is, you're increasing the amount of money that you have, whatever that is. So it could be a lot, it could be a little, but whatever it is, you're increasing the amount of money that you have, and that extra money can go towards the long-term goals that you have. So if you're planning for retirement and if you're working towards retirement, then those extra funds can be allocated towards retirement. And as you allocate, you save some money on taxes, and then you save that money into your portfolio, and then your portfolio is a little bit larger and it compounds a little bit faster, builds a little bit more on top of itself, and then you simultaneously get to go ahead and save a little bit more on taxes and a little bit more on taxes, and a little bit more on taxes every year, and so the tax savings compound and your investments compound. These things are working simultaneously to where you're taking years off of your potential work life and expanding your retirement by years, just through efficient and effective planning.
Jessica :
I mean, that could be so huge for a lot of people to be able to possibly retire a little earlier because of being able to invest more that they weren't paying in taxes. That's awesome. Are there other investment decisions, like the types of accounts that you invest in? Are those something that are going to impact your tax planning or vice versa?
Jason:
When you're looking at some of those things. I mean, there's eligibility and there may or may not be familiarity out there with Roth IRAs versus IRAs, versus different types of accounts. But some of these types of accounts will reduce your taxes now and some of them won't reduce your taxes now, but they'll reduce your taxes later. And so if you're strategic about it I mean, if you're in a high tax bracket now, then you want to reduce your taxes now. If you expect that you're going to be in a high tax bracket later, then you want to reduce your taxes later you always want to take into account what tax bracket you are in, what tax bracket you're potentially going to be in, and that's going to determine what your strategy should be and which direction you should be going.
Jason:
This can also impact where you are, as far as a lot of people have large 401ks that's, their primary savings for retirement.
Jason:
If you have everything in one single account, then you have no control over how or when or what you're going to do from a tax perspective. You're just at the mercy of hey, I have to take out whatever I take out and I have to pay whatever taxes I have to pay. But if you address that earlier and you start being more proactive with it, then you can open the door to multiple opportunities of things that you can do, ways where you can pay taxes at a point where it is less expensive for you to pay taxes. There's an opportunity it's pretty unusual to just make taxes disappear. That is something that can happen in certain situations, but not most situations. If they don't disappear, then the question doesn't become how do we get rid of them, how do we make them smaller, how do we minimize them and how do we go ahead and control them as much as possible, and so that's really the strategy and that's part of the foundation of tax planning.
Jessica :
You, I feel like, are explaining this in such a logical way that I'm like why would anybody not want to talk about tax planning? And I feel like it's just something that so many people don't realize or haven't been really exposed to.
Jason:
I can tell a little story on this. I came into the industry in 2006,. Straight out of college I was with Ameriprise for a while and then I worked with my stepdad for about eight years with an independent in an independent RIA and he told me very early on. He said if you can figure out tax planning, it's, it's amazing the impact of the tax planning can have. And I said, sure, whatever, that sounds like the most boring thing on the planet. Quite frankly, I have no interest in any of what you're saying whatsoever.
Jason:
Uh, I was about 25 at the time and I was like, nah, I have no interest in tax planning at all. And now I've gotten a little bit further along and I go. If you like to control numbers, which is kind of what we're hoping to do, you know you want to control the fact that you're growing investment accounts and you want to control the fact that you're shrinking tax bills and you want to control those numbers, then tax planning is a huge part of that. And I told him that recently I go. You know you told me that tax planning was really cool and I did not believe you for a second and I still don't think it's cool, but it is very interesting and very effective. But it's not cool, but it is interesting and effective.
Jessica :
Yeah, there is some purpose to it, for sure, right? Well, I think that is a great point to wrap things up for this particular episode on tax planning. As always, we hope that you found this very informative that you have some topics and maybe questions that you want to bring to your financial advisor, and if you don't have a financial advisor, we would love to the opportunity to talk to you to see if we could possibly help you along with your financial journey.
Jessica :
We are at Summit Wealth Group on all of our social media platforms or you can visit our website, www. summitwealthgroup. com, and we will get you connected with an advisor in your area or not in your area. We have plenty of advisors that work with clients out of state as well. So thank you so much for listening to this episode of the Reach your Summit podcast and we will catch you next time. Thanks for listening to the Reach your Summit podcast brought to you by Summit Wealth Group. If you enjoyed this episode and would like to help support the podcast, please share it with others and subscribe so you don't miss an episode. If you have any questions or topics that you'd like us to cover. Please email us at info@ summitwealthgroup. com.