A tax roadmap covering salary, vesting dates, share sales and the accounts you'll draw from later is what tax planning for executives with Scotia Wealth Management produces, for leaders paid largely in stock. The first pass takes about ninety days: two weeks to collect statements and election letters, about a month to build the projection, and the rest to agree on changes with your CPA.
The trigger is usually a letter. A former employer offers a pension buyout, or a deferred pay election has a cutoff three weeks away, and you have no time to model it. If the cutoff passes, the election is typically locked for the year, and a rollover into the wrong account can't be undone. Scotia Wealth Management clients often tell us they only wanted someone to read the letter before the window closed.
If your shares, deferred pay and equity awards each have their own advisor
Every share sale, deferral election and RSU vest lands on the same Form 1040, whoever advised on it. Scotia Wealth Management keeps one projection that shows all three together, so a sale in March doesn't collide with a vest in May. Concentrated stock planning covers how fast to sell under your selling schedule. Deferred compensation planning covers when the payouts start. Equity compensation planning covers how awards vest and are taxed. Each has its own page; here the job is the combined tax result.
What happens if a pension buyout letter arrives?
A pension buyout letter starts a clock, and the rollover you choose decides the tax for years. Rolling a lump sum into a rollover IRA costs nothing this year, but it can make most of every later backdoor Roth conversion taxable.
Take Meera's letter: a former employer offers her a $150,000 lump sum for her vested pension (hypothetical, round numbers). With about $800,000 of wages including vesting, she is far above the Roth IRA phase-out, so she makes a $7,500 backdoor Roth each year. Her top dollars are taxed at 37 percent ($800,000 − $16,100 = $783,900, above $640,600). If the lump sum sits in a rollover IRA, every conversion falls under the pro-rata rule: $7,500 ÷ $157,500 is about 4.8 percent tax-free, so roughly $7,143 of each conversion is taxable, about $2,643 annually at 37 percent. That cost repeats every year the IRA balance stays in place, and it grows as the balance grows. Rolled directly into her current 401(k), if the plan accepts roll-ins, her December 31 IRA balance stays at zero. Neither choice costs tax this year.
The table shows that each row is a choice that costs nothing in the year it is made.
Other events make this worth doing now: a vest year that pushes single taxable income above $640,600 (the IRS top-rate threshold for 2026), or starting to pay a parent's rent or care. A planned relocation counts too, because some states tax shares that vested partly while you lived there, so check your state's rules. Any letter with an election window also counts.
To check you're on track, ask your CPA for Form 8606. The taxable amount on your conversion should be close to zero, and your traditional IRA balance on December 31 should be zero. The shortcut: if you make backdoor Roth contributions, keep your pre-tax IRA balance at zero on December 31 of every conversion year.
| Common belief | What the rule says | What it means for you |
|---|---|---|
| Rolling to an IRA is neutral | Pro-rata counts December 31 IRA balances | 401(k) roll-in keeps backdoor tax-free |
| Paying Mom's bills uses the $19,000 exclusion | Medical bills paid directly are excluded | Pay providers directly, not Mom |
| Top bracket starts near $500,000 | 37% above $640,600 single, 2026 | A big vest year can cross it |
| Retirement taxes will be lower anyway | Rate depends on accounts you draw | Build Roth and high-basis shares now |
Who handles what: you, your CPA and Scotia Wealth Management
The roles split cleanly. You send the year-end stock plan statement and any election letters. Scotia Wealth Management models the options against one projection of your year. Your CPA prepares the return and sets quarterly estimates, and the attorney drafts documents such as a power of attorney for supporting your mother. The custodian moves money by direct rollover, which avoids the 20 percent withholding taken when a check is paid to you. One honest limit: this work doesn't replace your CPA, who prepares and files the return.
What do the first ninety days look like, week by week?
The first ninety days run in four stages, from collecting documents to a signed-off roadmap, and you spend about two hours of your own time in total.
One habit comes from our second-opinion stance. Before we suggest any change, we list what your current setup already does right and mark it as untouched, so you see what we're leaving alone as well as what we're fixing. A roll-in only helps if the plan accepts it and its funds and costs are reasonable; if you don't use a backdoor Roth, an IRA may still be the better home.
- Weeks one and two: you send your most recent return, the stock plan statement with lots and the vest schedule, and any letter with an election window. We list every cutoff in the next 12 months.
- Weeks three to six: we build a projection for this year and next, vest by vest, and compare withholding against it.
- Weeks seven to ten: we compare the options with your CPA on one call, for example a 401(k) roll-in versus an IRA rollover.
- Weeks 11 to 13: you receive the roadmap, quarterly estimate amounts are agreed with the CPA, and the next review is set before the next large vest.
Do you need executive tax help now or after the next vest?
You need it now if any one of three things is true: a vest year could push taxable income above $640,600 for 2026, a letter with an election window is on your desk, or you are about to move states or start supporting a parent. It can wait if your pay is mostly salary and 401(k) deferrals, where a CPA's year-end check is usually enough.
Waiting is a fair choice in that case, and we'd say so on the first call.
The next step is a note through the request form. Conversations are held online or by phone, the client minimum is $500,000 in investable assets, and no fee applies until you have seen it and agreed to it in writing.
- An election letter has a cutoff within 90 days.
- You hold a pre-tax IRA while making backdoor Roth contributions.
- Vesting will push taxable income above $640,600 single or $768,700 joint (2026).
Common questions on tax planning for executives
I pay part of my widowed mother's rent and medical bills; do I need to file a gift tax return?
Roth 401(k) or pre-tax 401(k) on an executive salary: which leaves more flexibility once paychecks stop?
What is Form 8606, and why does my CPA ask for it every year I do a backdoor Roth?
If I move to a state with no income tax, are my unvested shares still taxed by my old state?
Can a CPA handle executive tax planning alone, without a wealth manager?
Sources
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This content is general information and education only. It is not individualized investment, tax or legal advice. Investing involves risk, including possible loss of principal. Before making any financial decision, consult a professional about your own circumstances.