How to Pay Less in Taxes as a High-Earning Attorney

If you’re a high-earning attorney, you know that taxes take a painful bite out of your income. Unlike salaried professionals with standard W-2 deductions, attorneys—especially partners, solo practitioners, and high-income associates—face complex tax liabilities that can result in six-figure tax bills if not managed strategically.

But here’s the good news: The tax code is filled with perfectly legal ways to minimize what you owe. The key is being proactive rather than scrambling at the last minute. If you want to keep more of your hard-earned money, here are the most effective strategies you should be using.

1. Max Out Retirement Contributions to Reduce Taxable Income

One of the most efficient ways to lower your taxable income is by maxing out tax-advantaged retirement accounts. The IRS allows you to defer a significant amount of income each year, reducing what you owe in taxes.

✅ 401(k) or Solo 401(k): You can contribute up to $23,000 ($30,500 if you're 50 or older) for 2024. If you're self-employed or a partner, you may be able to contribute even more using employer profit-sharing contributions, bringing your total up to $69,000.

✅ Backdoor Roth IRA: If your income is too high for a standard Roth IRA, you can convert traditional IRA funds into a Roth to enjoy tax-free growth in retirement.

✅ Defined Benefit Plans: Some law firm partners use these pension-style plans to shelter six figures in tax-deferred savings annually.

The key? Set up automatic contributions so you don’t forget to max out these opportunities.

2. Take Advantage of the 199A Pass-Through Deduction

If you’re a solo attorney or law firm partner, you might qualify for the 20% pass-through deduction under Section 199A of the tax code. This deduction applies to qualified business income (QBI), which is a major tax-saving tool—but there are limits.

Things to consider:

• If your taxable income is below $383,900 (married) or $191,950 (single), you may qualify for the full deduction.

• If you’re above these limits, the deduction begins to phase out unless you use planning strategies like contributing more to retirement accounts or deferring income to keep your taxable income lower.

Work with a tax professional to determine if you qualify and how to structure your income to maximize the deduction.

3. Use Strategic Charitable Giving to Lower Your Taxable Income

For attorneys who donate to religious organizations, charities, or law school alumni funds, strategic charitable giving can provide a big tax break.

✅ Donor-Advised Funds (DAFs): Contribute a large lump sum (e.g., two or more years' worth of donations) in a single year to exceed the standard deduction. You still distribute the funds to charities over time.

✅ Qualified Charitable Distributions (QCDs): If you’re over 70½, you can donate directly from your IRA—reducing taxable income without increasing AGI.

✅ Appreciated Stock Donations: Instead of donating cash, donate stocks or assets that have appreciated. You avoid capital gains tax and get a deduction for the full market value.

If you’re already giving regularly, implementing tax-efficient strategies can supercharge your deductions.

4. Set Up an HSA (If Eligible) for Triple Tax Benefits

If you’re covered by a high-deductible health plan (HDHP), a Health Savings Account (HSA) is one of the most powerful tax-advantaged accounts available.

✅ Contributions are tax-deductible.
✅ Money grows tax-free.
✅ Withdrawals are tax-free for qualified medical expenses.

For 2024, the IRS allows you to contribute up to $4,150 (single) or $8,300 (family). If you’re 55+, you can add an extra $1,000.

Unlike Flexible Spending Accounts (FSAs), HSAs roll over indefinitely, making them an excellent long-term tax-free investment tool.

5. Deduct Business & Professional Expenses

If you’re a solo attorney, firm partner, or have any self-employment income, you can write off many expenses that W-2 attorneys can’t.

Tax-deductible expenses include:

• Home office deduction (if you regularly work from home).

• CLE courses, bar dues, and professional memberships.

• Legal research tools (Westlaw, LexisNexis, AI legal assistants, etc.).

• Marketing costs (website, ads, SEO).

• Health insurance premiums (if you’re self-employed).

Keeping detailed records of these expenses throughout the year will help ensure you maximize deductions when tax time rolls around.

6. Take Advantage of Tax Loss Harvesting in Your Investments

If you invest outside of retirement accounts, you should be using tax loss harvesting to offset capital gains and income.

✅ Sell losing investments to offset gains—reducing taxable income.
✅ Deduct up to $3,000 in investment losses against ordinary income each year.
✅ Reinvest in similar assets to maintain portfolio balance without triggering wash-sale rules.

Many high-earning attorneys forget to use this strategy, which can save thousands in taxable income.

7. Consider Relocating to a Tax-Friendly State

If you’re a remote or location-flexible attorney, one of the most effective tax strategies is moving to a tax-friendly state.

Utah, for example, has a 4.85% flat state income tax, which is relatively low compared to states like California (up to 13.3%).

Some attorneys even establish residency in states like Florida, Texas, or Nevada, which have NO state income tax, resulting in huge tax savings over time.

If your practice allows for location flexibility, this can be a game-changing strategy.

Final Thoughts: Start Planning Now

Taxes for attorneys are complex, but with the right strategies, you can drastically reduce your tax burden and keep more of your earnings.

The key is proactive planning. Whether it’s maxing out tax-advantaged accounts, structuring your firm income properly, or leveraging deductions, taking action before tax season is what truly makes a difference.