TCJA

As of 04/19/2024

Tax Cuts and Jobs Act (TCJA)
 

What is it?

On December 22, 2017, Congress passed the Tax Cuts and Job Act (TCJA) aimed at transforming the way individuals and businesses calculate their income tax bills and therefore changing the amount of federal tax each of us will pay. Key provisions of the TCJA include changes to individual tax brackets, the corporate tax rate, and deductions for certain expenses. As written, some provisions have an expiration date at which time they will sunset effective January 1, 2026. Some items that will expire or change will be:

• Income tax rates adjusting to pre-TCJA levels
• Standard deduction resetting to pre-TCJA amount (adjusted for inflation)
• Lifetime exclusion resetting to pre-TCJA amount (adjusted for inflation)
• Removal of the $10,000 cap for the state and local tax (SALT) deduction

As the sunset approaches, life insurance should be considered as an important part of the planning process for both individuals and businesses whether it is for estate, retirement income, or business-succession planning.

What does this mean for you?

The sunset of the TCJA may impact your clients in various ways depending on their individual financial situation. Some potential effects include changes to how taxes are prepared, income taxes paid, and deductions/credits which could result in lower or higher tax liabilities. It’s important to review how the TCJA provisions apply to each client’s specific circumstance.

High net worth clients can take advantage of the historically high exemption prior to 2026 by making tax-free gifts to trusts or loved ones today. This planning can reduce the value of their estate, prepare for payment of estate taxes, and efficiently transfer their wealth. With the individual income tax brackets set to increase across the board clients should be prepare for higher federal income taxes and plan accordingly.

Learn more about TCJA

10-Minute Sales Concept

This presentation highlights the urgency to adapt their financial strategies and capitalize on upcoming changes in tax regulations.

Quick Hit TCJA Video

This video shares ways to help clients take advantage of before the upcoming sunset of the Tax Cuts and Jobs Act at the end of 2025.

The (un)expected impact of tax changes on your client’s retirement

This video highlights the impact of tax changes from TCJA on your client’s retirement and how you can help diversify and simplify their assets.

Tax Cuts and Jobs Act Brochure

This brochure provides an in-depth overview of the Tax Cuts and Jobs Act.

Plan for tomorrow today flyer

This flyer provides an overview of estate tax planning for the upcoming sunset of the Tax Cuts and Jobs Act.