How sharing your tax return with us can help you make more confident financial decisions

By Tony Delane, CFP®, AIF®, Associate Wealth Advisor

On the surface, a tax return offers a view into the prior year’s activity – income, deductions, credits, and other relevant data points. Once filed, many of our clients don’t give it a second look. But key insights can be gained that can ultimately help you make more confident financial decisions. Our team of financial advisors leans on industry-leading technology and years of experience to utilize historical tax return data for better financial planning.

Here’s how we use tax returns for financial planning

Income Planning

Both Halbert Hargrove’s discovery process with prospective clients and ongoing client meetings are aimed at uncovering as much information as possible to make financial plans as accurate as possible. Your tax return often tells the “real” story about how much income a certain asset is producing and how it’s taxed, making our tax bracket modeling more accurate.

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Consider the example of a client with rental real estate. Though we often know what income certain properties can produce, the tax return can unveil the various tax deductions and other advantages, potentially reducing the tax liability. We don’t want to over- or under-state taxable income in our financial planning models without knowing the real story.

Analyzing Deductions for Opportunity

Although the Standard Deduction has increased in recent years, most clients who own their home tend to itemize. With your recent tax return on file, or even a historical file of multiple years, we can review deductions to make sure they are being factored into your financial plan.

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Without better data available, we may assume that a specific client takes the standard deduction each year, which may not be accurate. When the “input” in a financial plan is as detailed as possible, the “output” gives us more confidence when weighing different strategies and options.

Capital Gains Insights from Tax Returns

A tax return gives us valuable insight into capital gains. Knowing this information helps us understand your tax rate and potential future tax liabilities. Many returns will have typical trading activities included, but we’re always on the lookout for one-off reporting, like capital loss carryforwards or other unique items like property sales. Of course we strive to know what’s going on in your life through ongoing conversations, but it’s extremely valuable to verify how certain transactions were handled from a tax perspective.

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For example, if an asset you held was sold with a capital loss that’s carried into future years, we can adjust our model to account for the short-term reduction in tax burden.

Tax returns can be an invaluable tool for financial planning. We’re always seeking to enhance the effectiveness of our financial planning processes; receiving a real tax return can help us further refine outcomes. This helps you as a client to feel more confident in making financial decisions when faced with multiple options. If you’ve already sent your 2022 tax return to your team, we look forward to reviewing all of the above and more. If you haven’t shared a copy with us yet or are waiting to file, we’d appreciate receiving one as time permits.


Halbert Hargrove Global Advisors, LLC (“HH”) is an SEC registered investment adviser located in Long Beach, California. Registration does not imply a certain level of skill or training. Additional information about HH, including our registration status, fees, and services can be found at This blog is provided for informational purposes only and should not be construed as personalized investment advice. It should not be construed as a solicitation to offer personal securities transactions or provide personalized investment advice. The information provided does not constitute any legal, tax or accounting advice. We recommend that you seek the advice of a qualified attorney and accountant.