By Steve Crifasi, CTFA, CFP®

The pursuit of financial prosperity often hinges on a delicate balance: optimizing wealth accumulation while simultaneously reducing the effect of taxes. For affluent families, this balancing act becomes even more critical. In 2025, the shifting sands of tax laws present both challenges and opportunities.

This article explores advanced-tax planning techniques specifically for affluent households. We examine cutting-edge strategies to reduce your tax liability and efficiently transfer your wealth to future generations.

Estate Planning

We can begin by highlighting estate planning as a key component of tax-efficient wealth transfer.

Put simply, estate planning reduces tax responsibilities while allocating wealth to future generations. Carefully planning your estate allows you to take advantage of several tax benefits, such as annual gift tax exclusions and charitable deductions. 

In my experience as a professional wealth manager, the following estate-planning strategies are effective:

• Charitable giving: Use charitable giving strategies to reduce your taxable estate and leave a lasting effect.
• Family limited partnerships (FLPs): Transfer assets to future generations while keeping control by using FLPs to reduce gift and estate taxes.
• Gift tax exclusions: Make use of the annual gift tax exclusions to transfer money to beneficiaries without immediately incurring a gift tax.
• Generational skipping transfer tax: To avoid generational skipping transfer taxes, learn the rules that govern the transfer of wealth to grandchildren and beyond. 

Tax-Advantaged Investment Accounts

Investing in tax-advantaged investment accounts is another smart strategy for lowering your overall tax burden. These accounts are specialized savings vehicles that let you invest your money and receive tax incentives, helping your money to grow more quickly and effectively.

Some of the tax-advantaged account types I work with regularly include:

• Health savings accounts (HSAs): Contributions to HSAs are tax-deductible, and withdrawals from HSAs are tax-free for authorized medical expenses.
• 529 plans: Reduce your tax liability while saving for college expenses by utilizing 529 plans.
• Individual retirement accounts (IRAs): To lower your taxable income and save for retirement, invest in both traditional and Roth IRAs.
• Municipal bonds: Invest in tax-exempt municipal bonds to reduce your federal income tax responsibilities.

Tax-Advantaged Charitable Giving

One more strategy I want to mention is reducing your tax burden and increasing your philanthropic impact with tax-efficient charitable giving. 

When you donate appreciated assets—such as real estate or stocks—to a qualified charity, you can both reduce capital gains taxes and also earn a charitable deduction for the full fair market value of the asset.

Typical strategies for tax-advantaged charitable giving include:

• Charitable lead trusts (CLTs): Contribute funds to a worthy cause while keeping profits for a specific amount of time.
• Charitable deductions: Contribute cash, appreciated securities, or other assets to approved charities to reduce your taxable income.
• Charitable remainder trusts (CRTs): Create a trust that pays beneficiaries income for a prearranged amount of time, with the leftover funds given to charity. 
• Donor-advised funds (DAFs): Establish a DAF to save money on taxes right now and contribute to charities over time.

Partner With a Professional Tax Advisor

Last but not least, while the 2025 tax-efficient strategies for affluent families discussed here are an effective way to reduce your tax obligations, trying to manage the complexity on your own is challenging.

Working with a professional financial advisor can help you:

• Reduce your tax obligation by implementing tax-efficient strategies.
• Continue to comply with tax laws by regularly adjusting your approach.
• Discover fresh tactics that are appropriate for your particular financial situation.

Get in Touch Today!

Affluent families are currently in a unique position as upcoming changes to tax legislation are likely on the horizon. Working with a professional financial advisor is a wise choice as they can help you pursue long-term financial objectives, safeguard your wealth, and optimize tax strategies.

At Westover Capital Advisors, we offer our clients clear, comprehensive wealth management throughout their entire investing journey. To us, your money isn’t just an account number, it’s your life story.

To get in touch, call (302) 427-9600 or email [email protected]. We look forward to hearing from you.

About Steve

Steve Crifasi serves as Associate Director of Wealth Management and Business Development at Westover Capital Advisors, an independent, fee-only, and privately owned investment and wealth management firm founded in 1999 and based in Wilmington, Delaware. Steve provides tailored guidance and works in partnership with his investment, tax, and planning colleagues to understand clients’ wealth management goals and objectives and help fulfill them. Steve thrives off developing personal relationships with clients, serving as their reliable and trusted financial partner; and as a fiduciary, he provides advice that is always in their best interests. 

An advisor since 2008, Steve has over 15 years of experience in the financial services industry. He began his career as a research analyst at Penn Square Capital focusing on the equity and private real estate markets and spent over 13 years at Glenmede and Wilmington Trust as a relationship manager for high-net-worth clients. Steve received a BBA in Finance from Villanova University and also holds the CERTIFIED FINANCIAL PLANNER® certification and Certified Trust and Financial Advisor (CTFA) designation from the American Bankers Association. In addition to his role at Westover, Steve is a member of the Delaware Estate Planning Council and Wilmington Tax Group. He has also served on committees for several local charitable and nonprofit organizations in and around Wilmington. To learn more about Steve, connect with him on LinkedIn.