Key Points

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Tax Concepts

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Recent Tax Updates Summary

Top Income Tax Rates by State - investopedia

2025-tax-changes-document-avalara-tax-changes-2025.pdf.  GD

2025-tax-changes-document-avalara-tax-changes-2025.pdf. file

IRS Tax rates based on Marital Status 2021

less discriminatory on married filing single than in past years prior to 2017

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States That Don't Tax Income

Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming

States That Don't Tax Retirement Distributions

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Another way to reduce RMDs is by buying a deferred income annuity. You can invest up to 25% of your IRA or 401(k) account (or $135,000, whichever is less) in a type of deferred income annuity known as a qualified longevity annuity contract (QLAC). When you reach a specified age, which can be as late as 85, the insurance company turns your deposit into payments that are guaranteed to last the rest of your life

The portion of savings used for the annuity is excluded from the calculation to determine your RMDs. For example, if you have $500,000 in an IRA and transfer $100,000 into a QLAC, your RMD is based only on the remaining $400,000. This doesn’t eliminate your tax bill—it just defers it. The taxable portion of the money you invested will be taxed when you start receiving income from the annuity.

QLACs offer other advantages to retirees who want guaranteed income later in life. Because you’re deferring the income stream, payouts are much higher for deferred income annuities than they are for immediate annuities, which start payouts right away. For example, a 65-year-old man who invests $100,000 in an immediate annuity will receive a payout of $493 a month, according to www.immediateannuities.com. That same amount invested in a deferred-income annuity that begins payments at age 80 would pay $1,663 a month.

define options for accumulation period, investment guaranteed minimum returns, principal return to beneficiaries etc

Medicare Premium Fees for Part B for 2024

https://www.federalregister.gov/documents/2023/10/17/2023-22823/medicare-program-medicare-part-b-monthly-actuarial-rates-premium-rates-and-annual-deductible#:~:text=The%20standard%20monthly%20Part%20B,amount%20required%20under%20current%20law.

This details what the rates are and what the coverages are

https://www.humana.com/medicare/medicare-resources/irmaa

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This details what the rates are and what the coverages are

https://www.humana.com/medicare/medicare-resources/irmaa

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2024 Tax Assessment Impacts of the 2017 Tax Cuts

according to tax research presented to Congress in 2019 what was the impact of the 2017 tax cuts?
-- 1> did everyone get lower taxes? yes
-- 2> did more rich people get bigger tax decreases than poor people? yes
-- 3> after the cut, did the rich pay a higher share of their income in taxes than the poor? yes. ( 7 times higher rate than the poor )
-- 4> did the 2017 cut lower the unfair estate tax? yes
-- 5> did cutting corporate tax rates increase corporate taxes paid to the US? yes
-- 6> does any elected Democrat know how much the corporate tax rate can be rasied now without costing investment in the US and reducing IRS tax receipts? no

Potential Value Opportunities

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there is a way to increase the cost basis before a sale.

taking advantage of Section 1014 of the Internal Revenue Code, also known as a step-up in basis.

If you're a wealthy young American and you expect to make a substantial profit on the sale of assets like stocks or real estate, here's how gifting those assets to your parents could help you save a fortune.

So, if you gave stock worth $36,000 to your mom and dad today, you could transfer it tax-free by giving them each $18,000. Say the stock went up in value and was worth $336,000 by the time your second parent died in 20 years, the "cost basis" would reset to $336,000. If you sold the stock for $340,000 at that time, you'd only have to pay capital gains taxes on $4,000. Estate taxes would only be a concern if their estate crosses the threshold.

Potential Challenges

2024 Election Tax Impacts Reviewed

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rump has suggested he might eliminate all taxes on Social Security benefits. Currently up to 85% of benefits is taxed for a single person with combined income above $34,000 or a couple with combined income of $44,000

changing the tax-deferral status for retirement plans (also referred to as the "Rothification" of 401(k) contributions) << ok IF keeping Roth

Harris tax plans more bad than good - trying to spend more but not lower deficits

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a minimum 25% tax on total income, including unrealized capital gains

 taxing qualified dividends and long-term capital gains at ordinary income rates << hits those trying to build wealth for retirement through unions, 401ks

increased the CTC to $3,600 per child   ( there is a point where offering more tax breaks for more children does not make sense for the country )

estate tax exemptions will be cut in half

Harris may advocate for Democratic proposals to either limit or eliminate back-door and mega-back-door Roth IRA conversions << attacks middle class trying to build wealth for retirement

Add Social Security Tax on incomes over $400K — an opportunity defined negatively by Harris << no benefits value but taxing wrong income level

Harris has supported the Biden administration's proposal to subject earnings of more than $400,000 to Social Security taxes as a way to help shore up the Social Security trust fund.

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Biden 2025 budget proposal calls for increasing the net investment income tax (NIIT) to 5% from 3.8% for people with earned income of $400,000

Harris has proposed increasing the corporate tax rate to 28% from 21%. << kills the economy if more than 23%

Candidate Solutions

Tax Planning Tips

• Mortgage interest

• Interest on home equity loans and HELOCs

• Discount points

• Property taxes

• HOA fees

• Home improvements

• Home office expenses

• Capital gains tax

• Final thoughts

• FAQs

401K Record Keeping Systems Summary

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