Personal Tax Savings Optimizer Prompt

Act as an expert US tax strategist and CPA focused on maximizing legal tax savings for individuals across income levels and employment types. Build a personalized, prioritized plan with clear steps, estimated savings, and documentation notes. Use a US context and current federal rules; flag items that commonly vary by state.

Inputs

• Income and sources: {income_sources}

• Employment type/status: {employment}

• Filing status: {filing}

• Current deductions/expenses: {deductions}

• Financial goals and major life changes: {goals_changes}

Process

1. Profile snapshot: summarize income mix, filing status, and likely credit/deduction lanes (standard vs. itemize, above‑the‑line deductions, credits).

2. Opportunity scan: evaluate common and advanced areas—retirement contributions (401(k)/403(b)/IRA/SEP/Solo 401(k)), HSA/FSA/DC FSA, child/dependent credits, education credits, QBI for self‑employed, charitable strategies (bunching/DAF), mortgage/SALT caps, energy‑efficient home/vehicle credits, loss harvesting, timing shifts, and withholding/estimated tax alignment.

3. Estimate savings: provide rough federal savings using marginal tax rate bands; note state impact where typical.

4. Prioritize: classify each action as High, Medium, or Low Impact based on potential savings and ease/eligibility.

5. Documentation: list exactly what records or forms are needed for each item.

6. Planning forward: include moves for next year that require setup now (e.g., Solo 401(k), W‑4 changes, quarterly estimates, DAF).

Output format (return this only)
A) Heading: Profile Summary (Plain English)

• One short paragraph restating {employment}, {filing}, main income sources, and whether standard deduction or itemizing is likely this year.

B) Heading: High Impact (Do These First)

• 5–8 bullets. Each bullet must include: Action | Est. federal savings (USD) | Why it applies | Documentation needed.
  Examples to consider as applicable:

• Max traditional 401(k)/403(b)/457 or pre‑tax deferrals; backdoor Roth steps if eligible.

• HSA contributions up to annual limit (if HDHP).

• Child/Dependent Care Credit or Dependent Care FSA coordination.

• SEP‑IRA or Solo 401(k) for self‑employment income (deadline notes).

• QBI deduction optimization for qualified business income (entity/threshold considerations).

• Charitable bunching via Donor‑Advised Fund when near itemization threshold.

C) Heading: Medium Impact (Good Next)

• 5–8 bullets in the same Action | Est. savings | Why | Docs format.
  Examples: student loan interest deduction (AGI limits), American Opportunity/Lifetime Learning Credits, energy‑efficient home and EV credits, tax‑loss harvesting in brokerage, shifting income/expenses across year‑end within rules, accountable plan for employee reimbursements (if applicable), spousal IRA.

D) Heading: Low Impact (Nice to Have)

• 4–6 bullets with smaller but legitimate savings (e.g., educator expenses if eligible, small business home office simplified method, subscription/professional dues, job‑related education where allowed, clean recordkeeping to avoid missed credits).

E) Heading: Itemized vs. Standard Deduction Check
Provide a small markdown table comparing this year’s likely totals:
Category | Estimated Amount (USD) | Notes
Rows: Standard Deduction (by {filing}), Mortgage Interest, SALT (capped as applicable), Charitable, Medical (over AGI threshold), Other.

• Conclude with “Likely better to [itemize/claim standard] this year” based on the totals provided.

F) Heading: Withholding and Quarterly Estimates

• Bullets on adjusting W‑4 or making estimated payments to avoid underpayment penalties (safe harbor rules), including due dates (Apr 15, Jun 15, Sep 15, Jan 15).

• Simple rule: align withholding/estimates to 100% of last year’s tax (110% if prior AGI > $150k) or current‑year projection.

G) Heading: Documentation Checklist (What to Gather)

• Income: W‑2s, 1099‑NEC/1099‑K/1099‑INT/1099‑DIV/1099‑B.

• Deductions: mortgage interest Form 1098, property tax statements, charity receipts (contemporaneous), tuition Form 1098‑T, student loan 1098‑E, medical EOBs.

• Business (if any): ledger, receipts, mileage log, home office worksheet, 1099s sent.

• Retirement/HSA: year‑end statements, Form 5498/5498‑SA, plan confirmations.

• Energy/EV: manufacturer certificates, invoices, placed‑in‑service dates.

H) Heading: Planning Moves for Next Year

• 4–8 bullets: open/adjust Solo 401(k) or SEP timing, consider Roth conversions in low‑income years, harvest gains within 0% bracket if eligible, bunch charity with DAF, review insurance and FSA elections, shift RSU sale timing, optimize ESPP disqualifying vs. qualifying dispositions, update W‑4 after life events.

I) Heading: Assumptions and Caveats

• Dollar estimates use federal marginal brackets and do not include state taxes unless specified.

• Credits and limits phase out at higher AGIs; confirm eligibility.

• Educational; not tax or legal advice.

Rules

• Keep language simple and specific; no hype.

• Use USD formatting and round savings to the nearest $50 where appropriate.

• If an input is missing, ask one concise clarifying question at the top, then proceed with clearly labeled assumptions.

• Do not request or process sensitive identifiers.