Sarah D. McDaniel, CFA

Apr 03, 2026

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How Tax Season Opens the Door to Nextgen Client Relationships

Once a year, clients do something remarkable: they gather every meaningful financial document they own. W-2s, 1099s, brokerage statements, retirement account summaries, Social Security income, rental income, trust distributions, charitable contribution receipts are all collected in one place, often for the first time since last April. For a few weeks, your clients have a clearer picture of their complete financial life than at almost any other moment in the year. They know what they own, what it earned, who depends on them, and what they owe.

That document gathering process is more than a tax compliance exercise. It’s a full financial asset inventory that surfaces exactly the information that drives estate planning conversations: which accounts exist, how they’re titled, who the beneficiaries are, and whether the overall picture still reflects what the client actually wants to happen to their wealth.

For advisors, the window between when clients start pulling together their tax documents and when they file their returns is one of the most underutilized engagement opportunities of the year. Clients are already organized, already thinking about money, and already confronting decisions they tend to put off the other eleven months. That makes it the ideal moment to pivot from tax preparation to multigenerational planning and to start building the nextgen relationships that will determine whether your practice grows or shrinks through the great wealth transfer.

Here’s how to use tax season as a strategic entry point for nextgen engagement and how Vanilla can support you every step of the way.

Why tax season is the right moment

Tax preparation forces clients to confront three things that are directly relevant to estate planning:

1. Who counts as a dependent today. Clients reviewing dependents are, in effect, reviewing their family structure. Has a child turned 18? Has a grandchild been born? Has a divorce or remarriage changed the picture? These are exactly the questions that should be driving updates to a client’s family tree and beneficiary designations.
2. Where income is coming from. Reviewing IRAs, retirement accounts, investment income, and inherited assets surfaces the very holdings that will eventually transfer and their tax implications.
3. Who inherits what. The gap between what a client intends to leave behind and what their estate documents actually say tends to grow quietly over time. Tax season creates natural urgency to close that gap.

The insight here is simple: tax inventory = estate planning opportunity. And for advisors focused on retention and growth, estate planning conversations are where nextgen relationships are built or lost.

The retention risk you can’t ignore

Research consistently shows that more than two-thirds of nextgen clients leave their parents’ advisors after a wealth transfer event. The gap is rarely about investment performance but rather about familiarity, trust, and whether the next generation ever felt included in the planning process before the transfer happened. The advisors who retain those clients didn’t wait for an introduction at the funeral. They used moments like this one — when clients are organized, financially engaged, and open to conversation — to start building relationships with the people who will one day inherit their clients’ wealth. Tax season gives you a natural, low-pressure reason to do exactly that.

Five conversations to have right now

1. “Is your family tree up to date?”

This is the simplest question, and it opens everything else. Use this moment to verify that everyone who matters to your client is reflected in Vanilla’s Family & People.

Walk through the family tree together. Are all children listed? Have there been marriages, divorces, new grandchildren, or deaths since you last reviewed it? Does a blended family situation require a more nuanced conversation about whether heirs are treated equally or differently?

This isn’t just a data hygiene exercise. Family members become beneficiaries of your clients’ assets, and the key people in your clients’ lives become the guardians for minor children and the fiduciaries appointed to manage and distribute clients’ assets. Getting this right matters enormously.

In Vanilla: Adding or editing family members is straightforward. Simply navigate to the Family Tree diagram in Vanilla and click on the “+Add People” button to add a parent, partner, sibling, child, or other relationship. You can capture full legal names, dates of birth, relationship types, and contact information. Display options let you toggle age, location, and relationship labels, making the visual intuitive enough to share directly with clients.

2. “Do we have a complete picture of everything you own?”

Tax document season has a way of surfacing accounts and assets that haven’t come up in recent planning conversations. Clients don’t always volunteer these details unprompted, but they’re gathering the statements right now. This is the moment to ask directly: Is everything reflected in your plan? Because a plan built on incomplete information is, at best, incomplete planning.

For clients with assets scattered across multiple institutions, this conversation can also be an opportunity to discuss consolidation both for simplicity and for the very practical reason that beneficiaries shouldn’t have to track down a dozen accounts in a time of grief. For nextgen purposes, this matters even more as adult children who will one day inherit these assets often may have no idea they exist. Documenting not just the amounts, but the account types, ownership structures, and tax characteristics that will determine how and when they receive them is critical to avoid confusion and conflict at exactly the wrong moment.

In Vanilla: The Balance Sheet is where all of this comes together. It organizes a client’s complete financial picture across account types (bank accounts, retirement accounts and annuities, investment accounts, real estate, business entities, charitable entities like DAFs and private foundations, and liabilities) and displays each asset by both ownership and taxable estate status. Advisors can toggle between Account view (grouped by ownership and account type) and Asset view (grouped by asset class across all accounts), making it easy to spot concentration, liquidity gaps, or assets that may be titled incorrectly for estate planning purposes.

The Balance Sheet also integrates directly with Addepar, Black Diamond, Orion, and eMoney, so for advisors already using those platforms, much of the data entry burden is reduced. And because the Balance Sheet feeds directly into the Waterfall and Transfer Tax calculations, keeping it current isn’t just good practice, it’s what makes every other planning conversation in Vanilla more accurate and more useful.

3. “Do your beneficiary designations still match your wishes?”

Tax season is when clients think about their IRAs, retirement accounts, and annuities. That makes it the perfect moment to review who’s actually named as a beneficiary on those accounts because beneficiary designations override a will.

Ask your clients: Have there been any changes in relationships (marriage, divorce, a child reaching adulthood, a death) that should trigger a beneficiary update? Are there primary and contingent beneficiaries named on every account, or are some accounts carrying “None” or “Unknown” designations?

This is also a good moment to surface the SECURE Act implications. Most non-spousal beneficiaries now face a 10-year withdrawal window on inherited IRAs, which can compress significant taxable distributions into peak earning years. Does your client’s current plan account for this? Have they considered a Roth conversion strategy, or splitting an IRA at first death to start the clock earlier for children?

In Vanilla: Beneficiaries can be reviewed in the Beneficiaries Overview, which shows the Distribution Summary across people, trusts, and charities including what percentage of total distributions goes to each. To update a beneficiary on a specific account, navigate to Net Worth > Balance Sheet > select the account > Edit account.

4. “Do you know what your heirs will actually receive?”

The Waterfall is one of Vanilla’s most powerful client-facing tools, and tax season (when clients are already thinking about money and taxes) is an ideal time to walk through it.

The Waterfall shows clients exactly how their assets flow at first and second death: who receives what, in what form (outright vs. remaining in trust), and in what approximate amounts. It makes the estate plan tangible in a way that a stack of legal documents simply cannot.

For nextgen engagement specifically, the Waterfall creates a natural bridge: Have you talked to your children about what they’ll be receiving? Do they understand the structure and why some assets are in trust as well as why distributions happen at certain ages?

In Vanilla: The Waterfall appears under Estate and can be toggled to show projections at different death years or under different growth rate assumptions. The “First to Pass” toggle lets clients visualize the difference in outcomes depending on who dies first.

5. “Does your next generation know who’s on your financial team?”

The Financial Team section in Vanilla is one of the most underutilized relationship-building tools available to advisors. It’s a directory of every professional involved in a client’s financial life, including but not only advisor, attorney, CPA, trustee, with contact information in one place.

Ask your client: Would they like to share this information with their adult children? In the event of an emergency, do the nextgen family members know who to call? This is a low-stakes, practical reason to make an introduction.

That introduction, even if it’s just a shared document with names and phone numbers, is often the first thread that connects you to the next generation. Follow up by asking if there are introductions worth making while the client is still actively involved in the relationship.

In Vanilla: Select “+ Team Member” to add anyone to the Financial Team directory. The report can be shared with family members as a practical reference, and it reinforces your role as the coordinator of a comprehensive planning team.

The transfer tax conversation: for HNW clients

For clients with larger estates, tax season is a natural moment to revisit the Transfer Taxes view in Vanilla. Under the One Big Beautiful Bill Act (OBBBA), the federal exemption was permanently extended to $15 million per individual. But permanent doesn’t mean static. Many plans written before 2025 were built around a sunset that never came and may now need to be revisited.

Vanilla calculates estimated transfer tax exposure using a split death table, incorporating state estate taxes, state inheritance taxes (for applicable clients), federal estate tax, and GST tax. This is not the conversation for every client, but for more analytically minded clients who are already thinking about the numbers, it’s an opportunity to discuss whether existing planning, such as bypass trusts, SLATs, GRATs, or ILITs are still optimally structured given current law.

For clients who haven’t done advanced planning but may need it, this is the moment to ask: Do you want to understand how estate taxes are calculated and what your current exposure looks like?

In Vanilla: Once you’ve established the transfer tax picture, Vanilla Scenarios™ is where that conversation gets actionable. Scenarios lets you model hypothetical planning strategies layered on top of a client’s existing plan, and shows the projected impact side by side with the baseline. The visual comparison makes it easy for clients to see, concretely, what a given strategy could mean for their taxable estate and what flows to their heirs versus to taxes. If projections show a client moving from a non-taxable to a taxable estate, this is the conversation to have now, while there’s time to act.

Your income and estate tax action plans throughout the year

Tax season is finite. The relationships it opens don’t have to be. Here’s how to turn this window into a planning ritual that compounds over time.

Near term: 

• Pull up the Family & People in Vanilla for your top 10 clients and do a quick audit. Are all family members accounted for? Are relationship types accurate especially for clients with blended families or recent life changes? Flag anyone who needs a conversation.
• Schedule brief “tax season check-in” calls with clients who have complex estates or significant IRA balances. Use the Beneficiaries Overview in Vanilla to frame the conversation: do their designations still match their wishes? Are primary and contingent beneficiaries named on every retirement account? Identifying potential tax consequences for heirs prompts a multigenerational conversation to prepare for and take action to mitigate future tax obligations.  

This quarter: Identify three to five clients whose adult children you have never met. Use the Financial Team report as a warm introduction tool. Share it with the client first, then ask whether they’d like to bring their children into a planning conversation. This is the lowest-friction way to begin a nextgen relationship, and it positions you as the advisor who thinks ahead rather than the one who shows up after the fact.

Before year-end: For clients approaching or above the $15 million federal exemption, run the estate through the Waterfall in Vanilla to get the estimated transfer tax exposure and then share  the Transfer Tax table with the client in a dedicated planning review. Clients who understood their exposure early will thank you. Clients who didn’t will remember that too.

Tax season as a multigenerational planning ritual

The great wealth transfer won’t be won on investment performance. It will be won by the advisors who treated estate planning as an ongoing conversation and who thought to include the next generation before it was urgent. Tax season comes every April and the advisors who use it well don’t just catch planning gaps, they build the relationships that last through a transfer and the ones that outlast it. The tools are in Vanilla, the relationships are yours to build, and tax season is an annual opportunity you can’t miss.