June 11, 2025
For professionals earning $300K to $1M+ who want to stop losing so much to taxes.
For professionals earning $300K to $1M+ who want to stop losing so much to taxes
If you’re pulling in strong W-2 income—doctor, tech exec, finance pro, law partner—you know the tax system wasn’t built in your favor. You phase out of credits, lose most deductions, and often feel stuck.
This guide is for people like you: high earners who don’t have time for side hustles or complicated tax schemes but still want to keep more of what they earn.
Let’s dive into 10 strategies that actually work in 2025.
If you and your spouse are both working and max out your 401(k)s, you can shield $47,000 from taxes annually. That’s before any employer match.
Example: A 42-year-old couple earning $900K combined can contribute $23,500 each to their 401(k)s in 2025. That instantly reduces their taxable income by nearly $50K—saving ~$18K in taxes depending on their bracket.
This is the simplest way to lower W-2 taxes without needing extra time or complexity.
If you’re on a high-deductible health plan, an HSA lets you contribute pre-tax dollars, grow them tax-free, and spend them tax-free on qualified medical expenses—now or decades later.
Example: A family contributing $8,550 this year can deduct that full amount. If they don’t use it now, they can invest it like a retirement account and use it tax-free later.
Triple tax benefits, no strings attached—especially useful for high earners with predictable healthcare costs.
If you ever have a dip in income—bonus delay, sabbatical, leave for a new job—you may be in a lower tax bracket temporarily. That’s the perfect time to convert part of a traditional IRA to a Roth.
Example: A surgeon taking 6 months off between jobs can convert $50K to Roth and pay taxes at a lower bracket now, then enjoy tax-free growth forever.
This strategy helps you avoid RMDs later and gives you tax-free retirement income when you’ll really want flexibility.
Rather than giving $10K to charity each year and losing the deduction due to the standard deduction cap, consider front-loading a few years’ worth of giving into a donor-advised fund (DAF).
Example: A couple with a $1M income and a windfall this year could donate $50K to a DAF, get a full write-off now, and grant it out slowly over time.
This is perfect for families who want to be generous and smart about reducing their effective tax rate.
If you’re investing in a taxable brokerage account, avoid actively managed funds that trigger short-term capital gains. Stick with low-turnover ETFs and index funds.
Example: Swapping a high-turnover mutual fund for an S&P 500 ETF can cut your capital gains tax bill by thousands over time—especially if you’re in the 37% bracket + 3.8% net investment income tax.
High earners should never be surprised by a big 1099. Tax-aware investing is quiet but powerful.
If you’re already working remotely—or plan to in the future—where you live could cost or save you tens of thousands.
Example: Moving from California (13.3% state tax) to Texas (0%) on a $1M income could save you $133,000 a year. Yes, every year.
Even a partial year or change in residency after a liquidity event can make a huge difference. Just be sure to document it well.
If you’re looking for stable, passive income without increasing your federal tax bill, municipal bonds are a solid option—especially in high brackets.
Example: A $500K muni bond portfolio yielding 4% gives you $20K/year of tax-free income. To match that with taxable investments, you’d need closer to $30K gross.
Muni bonds aren’t sexy, but they’re effective for parking wealth while staying tax-efficient.
While 529s don’t reduce your federal taxes upfront, many states offer deductions or credits—and you’ll enjoy tax-free growth and withdrawals for education.
Example: A family in New York can deduct up to $10K in contributions, and avoid all taxes on decades of growth used for tuition, books, or even K-12.
It’s one of the best legacy moves you can make if you want to shift assets to your kids without gift tax issues.
Selling underperforming stocks or funds allows you to lock in losses and use them to offset gains elsewhere—or even deduct $3K per year against your regular income.
Example: A tech exec sells underperforming shares for a $25K loss, offsets $25K in private equity gains, and avoids ~$9K in taxes.
It’s smart portfolio hygiene—especially important for high earners with big swings in investment income.
This one’s not widely known—but it should be. Direct investments in oil and gas drilling projects can offer huge first-year deductions, even for passive W-2 earners.
Example: A couple earning $1M invests $100K in a vetted oil and gas deal and gets a $90K–$100K deduction in year one. That could lower their tax bill by $35K–$40K.
It works because of special tax treatment like intangible drilling costs (IDCs) and depreciation. It’s one of the only passive investments that lets W-2 earners directly offset their income.
The key? Working with a reputable operator—this space is full of both opportunity and risk. Platforms like Fieldvest exist to match accredited investors with vetted, tax-advantaged projects.
You don’t need to launch a side business, become a landlord, or move off-grid to pay less in taxes. These 10 strategies work—right now—for high-earning W-2 professionals who want to be proactive.
Use what fits your lifestyle, and don’t be afraid to mix traditional tools (401k, HSA) with smarter alternatives like oil & gas investing or donor-advised funds.
Want to see how much you could save this year? Use the Fieldvest Tax Savings Estimator →