Why Tax Planning, Estate Planning, and Your CPA Belong in the Same Conversation

Lessons from years of IRS practice on what high-net-worth families actually need from their advisors 

By Emma Smith, Senior Counsel at Comiter Singer (former IRS Office of Chief Counsel attorney)

By the time a tax return is being prepared in March or April, almost every meaningful planning lever has already passed. What remains is documentation and damage control. The taxpayers who pay materially less, year after year, treat tax planning as a year-round effort and view the return itself as the report card, not the strategy. 

After years working tax matters from both sides of an IRS notice, I have come to think of April 15th as the wrong day to think about taxes. The right day is whatever day you are reading this. 

The taxpayers who consistently pay less also tend to share something else in common, and it is the real subject of this post. They do not treat their tax planning and their estate planning as separate projects, and they do not let their tax attorney and their CPA work in parallel silos. The advisors talk to each other, on purpose, throughout the year. That single structural choice tends to be worth more, in real dollars, than any individual planning idea. 

Tax Planning Is Not an April 15th Problem 

There is a category of tax planning that simply ceases to exist at midnight on December 31. Section 179 expensing on equipment placed in service. Bonus depreciation, which the One Big Beautiful Bill Act (the “OBBBA”) permanently restored to 100% for qualifying property acquired after January 19, 2025. Roth conversions. Qualified charitable distributions from an IRA. Donor-advised fund contributions. Tax-loss harvesting. Year-end S-corporation reasonable compensation adjustments. None of these can be retroactively claimed in March; they are calendar-bound, and once the calendar turns, they are gone. 

Beyond the calendar-bound items, a much larger category of planning depends on lead time that the spring filing season does not provide. Entity restructuring, trust funding, valuation work for transferred business interests, residency changes, and meaningful charitable strategies all require months of preparation to execute properly, with documentation that will survive scrutiny if scrutiny ever comes. 

The point is not to memorize the rules. The rules operate on a fixed calendar, and that calendar does not adjust for the realities of a busy fourth quarter. Year-round tax planning is the difference between catching consequential decisions while they are still decisions and learning about them in February, when they are simply facts. 

Tax and Estate Planning Are One Conversation, Not Two 

For high-net-worth families, the income tax return and the estate plan are the same plan viewed from two angles. Decisions about entity structure, asset titling, and lifetime gifting drive both income tax outcomes and wealth transfer outcomes, and treating them as separate workstreams is how families end up with plans that optimize one and quietly damage the other. 

The two disciplines overlap so completely in places that no clean line separates them. Lifetime gifting is simultaneously a gift tax decision and an income tax decision, because gifted assets carry over the donor’s basis rather than receiving a step-up at death. Choice of entity is simultaneously an income tax question and an estate planning question, driving everything from Section 199A treatment to the availability of valuation discounts on transferred interests. Grantor trust planning depends on the deliberate misalignment of income tax and estate tax treatment; the income tax burn paid by the grantor is itself a wealth transfer technique. A family that meets with its tax advisor in March and its estate planning attorney in October is having two halves of a single conversation, twice a year, with the two halves rarely if ever connected. 

The current legal landscape makes integrated planning more valuable, not less. Under the OBBBA, the federal estate and gift tax exemption is permanently set at $15 million per individual ($30 million for married couples) beginning January 1, 2026, with inflation indexing thereafter. The pre-2026 anxiety, which had families racing to use a higher exemption before a scheduled sunset, is no longer the operative dynamic. The new question is not how to beat a deadline; it is how to use a permanent, generationally significant exemption thoughtfully, with the income tax consequences of each gifting and trust decision evaluated alongside the estate tax consequences. Many families who built plans around the feared exemption reduction now have plans calibrated to a problem that no longer exists, and a meaningful portion of those plans need a fresh look from advisors who can speak to both sides of the tax code. 

For Florida residents, integrated planning has an additional dimension. Florida has no state estate tax and no state income tax, and the homestead protection is among the strongest in the country. Families relocating from estate-tax states or maintaining residences in multiple jurisdictions need to think carefully about domicile, source-of-income rules, and the timing of asset sales relative to a residency change. These are decisions made long before any return is prepared, but they are precisely the decisions that determine what the eventual tax bill looks like. 

Transactional Estate Planning: When a Business Sale Becomes a Wealth Transfer Event 

Nowhere is the integration of tax and estate planning more consequential than in a transaction. A business sale, a recapitalization, a merger, or an acquisition is, for the family that owns the business, almost always the single largest taxable event of a generation. It is also, simultaneously, the single largest wealth transfer opportunity of a generation. Treating those two facts as belonging to two different planning conversations is how families pay tax twice on the same dollar. 

Timing is the throughline. Once a deal is reasonably foreseeable, the assignment of income doctrine can attribute gain back to the original owner regardless of who technically held the interest at closing, which means certain transfers made too late in the process generate gift tax exposure without producing the intended estate tax benefit. Pre-transaction planning, by contrast, where business interests are moved into grantor trusts or family entities well before a sale is on the horizon, can shift both the equity and its future appreciation outside the estate. 

Within the deal itself, the structuring choices carry both income tax and estate planning consequences at once. The choice between an asset sale and a stock sale, the use of installment treatment under Section 453, qualified small business stock under Section 1202, the tax characterization of earnouts and rollover equity, and the use of charitable structures all interact with the family’s estate plan. Each of these decisions affects how much tax is paid, when it is paid, and how much of the post-sale wealth ends up inside or outside the taxable estate. 

Buy-side transactions raise mirror-image questions for families acquiring through an existing trust or family entity. Which entity makes the acquisition, how the purchase price is allocated, and how the acquired business is held going forward are simultaneously deal decisions and estate plan decisions, and a poorly chosen acquisition vehicle can foreclose planning options for decades. 

The practical takeaway is that transactional planning belongs at the table well before the transaction is in view. Restructuring undertaken in the year of a sale is usually too late; restructuring undertaken three to five years before a likely liquidity event is usually where the meaningful results come from. The families who get this right tend to be the ones whose tax attorney, estate planning attorney, CPA, and investment banker have been having the same conversation for years, not the ones who assemble the team after a buyer expresses interest. 

Your CPA and Your Tax Planner Should Be on the Same Team 

A point worth making clearly, because it is easy to misunderstand: a tax planner does not replace a CPA, and a good CPA does not need to play tax planner. The two roles are different, and the families who get the best results have advisors who recognize the distinction and work together accordingly. 

A CPA’s core function is compliance: accurately reporting what already happened, preparing returns that withstand scrutiny, and translating complex transactions into the language of financial statements and tax filings. A tax planning attorney’s core function is structural: evaluating the legal defensibility of positions before they appear on a return, designing transactions and entity structures that produce favorable outcomes by design rather than by accident, and integrating income tax planning with estate, gift, and generation-skipping considerations. 

Neither role substitutes for the other. Compliance without planning produces accurate returns that pay more tax than necessary. Planning without compliance produces good ideas that fall apart on the return.  A planning idea the CPA does not know about can be unwound on a return without anyone meaning to undo it, and a CPA watching the income trajectory through the year is often the first person to notice that planning is needed at all. In a transactional context, that coordination is not optional: the structuring decisions sit with the attorney, the purchase price allocation and K-1 reconciliation sit with the CPA, and a deal in which those two sides were not designed together rarely achieves what it could have. 

There is also a procedural distinction worth noting. The federally authorized tax practitioner privilege under Internal Revenue Code section 7525, which covers communications with a CPA, is meaningfully narrower than attorney-client privilege; it is limited to certain federal tax matters, does not extend to proceedings before agencies other than the IRS, and does not extend to communications related to tax shelters. Communications with a tax attorney fall within the traditional attorney-client privilege, which is broader in scope. Where a CPA’s work is needed for a matter that requires privilege protection, a Kovel agreement (named after the Second Circuit’s 1961 decision) allows the CPA to be engaged through the attorney, extending privilege to the accountant’s work in furtherance of the legal representation.  This is one more reason that a client is best served when the attorney and CPA work in coordination, not in parallel.  

In practice, what a working relationship between a tax planner and a CPA looks like is undramatic. It is a quarterly call rather than a once-a-year handoff. It is a shared understanding of where the client’s income, deductions, and planned transactions are heading well before any of it lands on a return. It is both advisors knowing what the other is doing, in real time, on behalf of a client whose tax life and estate plan are not separable into tidy categories. The families who have that infrastructure in place rarely have surprises in April. 

The Cost of Waiting 

Most of the planning ideas worth pursuing share a common feature: they require lead time. Lead time to draft, to fund, to obtain valuations, to coordinate with a CPA, to put a structure in place thoughtfully. The cost of starting late is not always a missed deduction or a higher tax bill in a single year. Sometimes it is a structure that could have been put in place but no longer can be, or a transaction that has to be reported as it happened rather than as it could have been planned. 

That cost is rarely visible at the time. It does not necessarily appear on a return, and it does not always generate an IRS notice. It shows up in the gap between what a family actually paid and what a more coordinated plan would have produced. 

The clients who avoid that gap are the ones who treat tax and estate planning as an ongoing relationship, not a once-a-year transaction, and who insist that their advisors do the same. If you are reading this and recognizing that your own planning has been more reactive than proactive, the conversation is worth having. The earlier in the year, and the earlier in your transaction horizon, the more there is to talk about. 

Our tax and estate planning groups at Comiter Singer welcome the conversation.