As the 2024 election looms, financial advisors are keeping a close eye on potential tax changes that could impact their clients. The Tax Cuts and Jobs Act of 2017, signed into law by former President Donald Trump, implemented various changes for individuals such as lower tax brackets, higher standard deductions, and a more generous child tax credit. However, many of these provisions are set to expire after 2025 unless Congress takes action.
At Extreme Investor Network, we understand the importance of staying ahead of potential tax changes and planning accordingly. With more than 60% of taxpayers facing potential tax increases in 2026 if the TCJA provisions are not extended, it is crucial to consider the implications for your financial strategy. The uncertainty surrounding control of the Senate and House makes it difficult to predict which provisions may be extended, adding to the complexity of planning for the future.
Our team of experts recommends exploring tax strategies to potentially mitigate the impact of higher taxes in the coming years. Accelerating income into 2024 and 2025 may be a viable option for some investors, especially as tax brackets are set to revert to pre-TCJA levels after 2025. Retirees with significant pretax retirement balances should pay close attention to potential rate increases, especially when it comes to required minimum distributions (RMDs).
Every individual’s tax profile is unique, which is why personalized planning is essential. Our advisors are equipped to run projections and develop tailored strategies to navigate the uncertainty surrounding TCJA changes. While outside groups are gearing up to advocate for their preferred provisions, we believe that careful consideration and timing are key when making tax-related decisions.
Estate planning is one area where proactive action may be warranted, given the longer-term nature of these strategies. At Extreme Investor Network, we are committed to helping our clients navigate the evolving tax landscape and make informed decisions to protect their financial wellbeing. Stay tuned for more insights and guidance on how to optimize your personal finance strategy in light of potential tax changes.