Required distributions from IRAs and 401Ks, plus other investment income can reqlly add up. For example RMDs are treated as ordinary income.
Suzi's retiree worked unto 65. For example, a 65 year old with a 2M IRA, earning 7% would need to have at a minimum RMD withdraw of 95k per year. That alone fills up the desirable brackets.
Lets say they also have 8M in a taxable account, half in income focused REITs and half in a S&P500 index stock fund. The stocks pay roughly 2% ordinary dividend, not including any forced capital gains. Thats 4Mx2% or another 80k. If the REIT pays maybe 7%, so thats 4Mx7% or 280k more.
So RMDs and dividends have this guy already at 450+k in income, not counting SS, which gets added in too. Now I never personally said it is 30%, but thats also not a 15% bracket. AMT is still out there too. Plus, if they like the lights of LA, CA state tax!
You might be suprised how taxes under her scenario add up. Sure there are ways to try to minimize the tax, but clever tax dodging schemes are scarcer than you might suspect these days. Many have been voided by the IRS or require accounting which limit options or introduce other headaches, so many just pay their tax. A vague statement that they should be able to avoid taxes is not a real thing.
PS, if you have specific plans other than the usual keep earned income low, max your cap gains and fill up ROTH options, Im all ears. In summary, we all agree that too much wealth can be sub optimal (from a tax perspective, certainly). Sol summarized it well.