Taxes are rarely static. The rules change. Income changes. Investment values rise and fall. And decisions that made sense a year ago may deserve another look today.
That is why we believe tax planning should be an ongoing part of a financial plan rather than something that happens only when it is time to file a return.
At Welch Financial Planning, we look at taxes throughout the year and consider how changes may affect each client’s larger financial picture. Our approach to adaptive tax planning means reviewing new information as it develops and considering whether a client’s strategy should change along with it.
Tax Planning Is Different From Tax Preparation
Tax preparation looks backward. It focuses on reporting income, deductions, credits, and other information from a year that has already ended.
Tax planning looks forward.
Our goal is to identify decisions that may affect a client’s tax situation before deadlines pass. That may include retirement account contributions, charitable giving, investment decisions, Roth conversions, or the timing of income.
This distinction matters because many tax decisions cannot simply be changed after December 31.
Waiting until tax season can also add to the pressure people already feel around taxes. A 2026 survey conducted by Qualtrics on behalf of Intuit TurboTax found that 46% of Americans consider tax season the most stressful financial moment of the year.
Planning throughout the year can shift some of that work away from a short filing window. It gives us more time to consider different choices and how they fit into a client’s broader goals.
Tax Rules Can Change From One Year to the Next
The U.S. tax code changes frequently. Each year can bring thousands of amendments, administrative updates, technical corrections, and inflation-related adjustments. Larger pieces of legislation can create even broader changes.
The 2017 Tax Cuts and Jobs Act is one example. More recently, the One Big Beautiful Bill Act, signed into law in July 2025, changed numerous federal tax provisions. The law affected deductions, credits, tax rates, and other areas that may influence individual financial plans.
Even without a major new law, the IRS adjusts many tax figures from year to year. For 2026 alone, the IRS announced inflation adjustments for more than 60 tax provisions. These include tax brackets, the standard deduction, and other dollar amounts.
Retirement limits can change as well. For example, the 401(k) employee contribution limit increased from $23,500 in 2025 to $24,500 in 2026. The IRA contribution limit increased from $7,000 to $7,500.
We monitor tax law changes like these because even a seemingly small adjustment may create a new planning opportunity or affect an existing strategy.
Markets Can Affect Tax Decisions, Too
Changes in tax rules are only part of the picture. Investment markets can also influence tax planning.
When markets rise, investors may have larger unrealized gains in taxable accounts. Selling appreciated investments could create capital gains. That makes it useful to think about which assets to sell, when to sell them, and whether losses elsewhere in a portfolio could offset some gains.
When markets fall, different opportunities may appear. An investor might have assets trading below their purchase price. Selling those investments could create losses that may be used to offset certain gains, subject to tax rules and the investor’s circumstances.
Lower asset values may also affect the math behind a Roth conversion. Moving money from a traditional retirement account to a Roth account generally creates taxable income in the year of the conversion. When investment values are lower, it may be possible to convert more shares at a lower taxable value.
We do not believe investment decisions should be made for tax reasons alone. Instead, we consider market conditions alongside investment goals, income needs, risk tolerance, and the rest of the financial plan.
A Change in Your Life Can Change Your Tax Picture
Not every reason to revisit a tax plan comes from Washington or Wall Street. Sometimes, the change happens much closer to home.
A new job, retirement, a business sale, an inheritance, or a large charitable gift can all affect taxes. So can a change in income or the decision to start taking money from retirement accounts.
Consider someone preparing to retire. During their working years, most of their income may come from a paycheck. After retirement, income could come from Social Security, a pension, taxable investments, traditional retirement accounts, or Roth accounts.
Each source may receive different tax treatment.
That creates questions about where retirement income should come from and when. It may also create years when a Roth conversion, charitable strategy, or another tax planning approach deserves consideration.
This is why we look at taxes as part of the larger financial picture rather than treating them as a separate annual task.
We Can Model Different Tax Scenarios
One of the benefits of year-round planning is the ability to ask, “What if?”
What if you retire next year instead of three years from now? What if you convert part of a traditional IRA to a Roth IRA? What if you sell an appreciated investment? What if your income increases substantially this year?
Scenario planning allows us to compare potential outcomes before a decision is made.
Taxes are not always about finding the choice with the smallest tax bill today. Paying some tax now may make sense if it supports a longer-term goal. In other situations, delaying income or spreading a financial decision across several tax years may deserve consideration.
The answer depends on the person, which is why tax planning works best when it is connected to the rest of the financial plan.
Tax Planning Should Keep Moving With You
Financial plans change because life changes. Markets change. Congress passes new legislation. The IRS adjusts limits and thresholds.
We believe a tax strategy should be able to respond to those changes.
At Welch Financial Planning, we continue to review how taxes interact with investments, retirement income, charitable giving, and other financial decisions. When circumstances shift, we can revisit the plan and discuss what those changes may mean.
If you would like to take a more proactive approach to taxes as part of your broader financial plan, the team at Welch is available to start the conversation.