Qualified vs Unqualified strategy?

[LOL!]

Actually, I prepare taxes for a living (CPA).
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Having said that, you're doing a great job of lowering your tax bill. I've got kids in college, itemize, HSA, etc, but we make too much to even consider a Roth conversion. Once we retire and the income comes down, we'll probably start doing conversions as my goal is to be 50% tax deffered and 50% after-tax.

Well, I doubt anybody would do conversions while still working in a high tax bracket. But once retired and/or living off of "return of capital", things are a little easier.

And you saw this as well: http://www.early-retirement.org/forums/f28/tax-free-income-64354.html#post1264682 which makes taxes pretty low as well for folks still working, but living off of "return of capital".

Do any of your 6-figure-income clients shelter 80+% of their W-2 compensation?

 

[PatrickA5]

I have very few higher-end clients that can shelter even 30% of their ordinary income, so in that respect, you're doing great!

Me personally, I don't like "spending" money to save taxes as is the case with itemized deductions and most credits. I'll be happier when I finally get to the point where I can't itemize (i.e. take standard deduction) and don't qualify for college 529 plan income exclusions. That means I'm spending less money! I still have people tell me they keep their mortgage for the interest deduction. I tell them they can give me a dollar and I'll give them back a quarter - all day long - don't even have to itemize!

 

[LOL!]

We did not shelter 80+% of W-2 compensation.

We did not itemize in 2011, but we do bunch deductions into every other year, so 2012 will be a year to itemize. I agree with not spending money needlessly to reduce taxes. In my list in the other thread, we really did not spend money that was not going to be spent anyways. For example, we have no mortgage and no mortgage interest deduction. We have no state income taxes and no state income tax deduction. And we did our own taxes, so had no deduct misc itemized expenses.

We have been at about 50% taxable / 50% tax-advantaged in our overall portfolio since we started investing decades ago. I hope to convert to almost all Roth IRA in the next 20 years.