How We Estimate

The Financial Clarity Check shows a dollar range next to each item that fits your answers. Each range is an illustrative estimate from your answers. It gives you a rough size so you can see which items are worth a closer look. It is not a promise and not tax advice. This page says where the numbers come from and the rules we follow.

Where the numbers come from

• 2026 tax rules and limits published by the IRS, Social Security and Medicare.
• Published studies and industry data, listed below with their dates. When two sources disagree, we use the lower number.
• Your answers. For each range you picked (income, tax, age, savings, business size), we use the middle of the range.

Rules we follow

• Some items lower your tax for good. Others move the tax to a later year. We label those "tax deferred".
• Yearly, one-time and lifetime amounts are shown separately. We never add them together.
• Year-end tax planning already covers the other yearly items, so we don't add it on top of them.
• The yearly total can't be more than 60% of the federal tax you told us you pay. If you didn't know your tax, we use what IRS data shows households at your income usually pay: about $8,000 under $150,000 of income, $25,000 at $150,000 to $250,000, $65,000 at $250,000 to $500,000, $165,000 at $500,000 to $1 million, and $400,000 above that.
• A range can start near zero. Some items won't apply once we see your documents.
• If we can't back up a dollar figure, we don't show one.
• If you answered "don't know", the result says "if" and doesn't state it as fact.
• We round down.

How each item is estimated

• Year-end tax planning: a small share of the federal income tax you pay: 2% to 5% for salaried households and retirees, 5% to 12% for business owners. We found no reliable study that supports more.
• A cash balance plan (a bigger retirement plan for owners): the 2026 IRS limits and published tables for owners your age, capped at 40% of your income, times your tax rate. You pay that tax later, when the money comes out. Staff usually receive 5–7.5% of their pay.
• A cost segregation study (an engineering study that speeds up depreciation): the share of a building's cost that published studies move into faster write-offs (15% to 25% of a rental, 12% to 25% of a commercial building), times the middle of the building value range you chose, not counting land. If the rules on rental losses would hold the deduction back (the usual case for anyone whose income is a salary, self-employment or retirement income, whatever the amount), we show it as a deduction and don't count it as tax saved. For an owner whose business uses the building, it is usually usable, and we count the tax it defers.
• A Roth conversion plan (moving pre-tax savings into a Roth account in lower-tax years): 1% to 5% of your pre-tax retirement savings (money you haven't paid income tax on yet), over your lifetime, based on published retirement studies. Converting only helps if your tax rate later would be higher than it is when you convert, so while you're still working we show no figure.
• Required-withdrawal and Medicare planning: Medicare's 2026 premium surcharges, assuming planning keeps you one income step lower, about $1,100 to $1,700 a year for each person on Medicare. Required withdrawals start at 73 if you were born before 1960, 75 if you were born in 1960 or later.
• Pre-sale tax planning: a sale price estimated from your revenue using published small-business sale data, the federal tax on that sale, and 5% to 10% of that tax. The saving can never be more than the tax.
• An entity and owner-pay review (how your business is set up and how you pay yourself): the 2026 payroll-tax and deduction rules for owners your size. The result can be zero; the low end is what a simple expense-reimbursement plan usually saves.
• A life policy review: no dollar figure. The answer can be to keep the policy, add to it, or change it, and no neutral study measures a typical outcome.
• The 2026 rule (Roth catch-ups): the 2026 IRS limits, $24,500 for a 401(k), $8,000 catch-up from age 50 and $11,250 at ages 60 to 63, times your tax rate, assuming you're not already putting in the most. If your own wages from one employer were over $150,000 last year, catch-ups have to go in as Roth, so the tax moves to now.
• "You pay about X%": we compare the tax you told us with IRS data for your income. If they don't fit, we leave the sentence out.

What the numbers leave out

State tax (Texas has none), the alternative minimum tax, the net investment income tax and some income phase-outs. We handle those when we look at your return. A qualified tax professional has to check your actual return and numbers before you act on anything.

Sources (reviewed September 2026)

We review this page each year when the IRS publishes new limits, and whenever the law changes.