The U.S. Internal Revenue Service (IRS) building stands after it was reported the IRS will lay off about 6,700 employees, a restructuring that could strain the tax-collecting agency’s resources during the critical tax-filing season, in Washington, D.C., Feb. 20, 2025. Kent Nishimura | ReutersA version of this article first appeared in CNBC’s Inside Wealth newsletter with Robert Frank, a weekly guide to the high-net-worth investor and consumer. Sign up to receive future editions, straight to your inbox.For seven years, wealthy Americans faced a looming deadline to take advantage of tax provisions that were set to expire at the end of 2025. While the One Big Beautiful Bill Act alleviated much of the uncertainty by making most of the cuts permanent, lawyers and tax accountants say the ever-shifting tax code requires constant planning.With this year’s Tax Day now behind us, here are five of the most important planning strategies wealthy investors and high earners are thinking about for next year and beyond.1. Long-short tax-loss harvestingLast year’s tax bill permanently raised the estate tax exemption to $15 million per person, up from $13.99 million. (It was initially set to be cut in half at the end of 2025.)The higher threshold has prompted a shift in focus from minimizing federal estate taxes to lowering taxes on income and capital gains. Minimizing capital gains has become crucial after several years of strong market gains, according to Mitchell Drossman, head of national wealth strategies in Bank of America’s chief investment office. The S&P 500 has surged more than 75% since the beginning of 2023.”The biggest tax story to me is a capital gains and investing story,” said Drossman. “You have lots of clients who are sitting on significant gains.”Investors are increasingly turning to long-short tax-loss harvesting, an aggressive form of a popular strategy, in order to minimize capital gains, Drossman said. With traditional tax-loss harvesting, investors sell losing assets to offset realized gains on others. Long-short tax strategies, on the other hand, borrow against the portfolio to buy short positions expected to fall and maintain lon …
