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Will My Taxes Go Up After TCJA Sunsets?

Will My Taxes Go Up After TCJA Sunsets?

April 08, 2024

As tax season winds down, many of us are thinking about how to improve our tax situation next year. One topic I hear get asked about from friends and clients is the sunset of the Tax Cuts and Jobs Act of 2017 (TCJA). Currently, many of the provisions of this law will expire at the beginning of 2026 unless Congress takes action to change things.

Many folks have questions. The most common questions are:

How Much Will I Be Affected By The Sunset?

The answer will be different for every family. I work with all my clients to analyze their tax liability every year. We are always working to add tax-savvy strategies whenever they fit. For most folks, the sunset will mean more income tax paid, but EXACTLY how much depends. And sometimes there are strategies you could use to reduce the sting of the changes.

If you would like me to take a look at your situation, follow this LINK to find a time for us to talk. I am honored to be of service.

What Are The Smartest Things Can I Do in The Next Two Years To Prepare For The Sunset?

Here just a few topics to consider:

  • Are taking Required Minimum Distributions (RMDs) or will you start before 2026?
  • Do you own an inherited IRA? Are you taking RMDs or should you start before 2026?
  • Do you own appreciated non-qualified assets (like real estate, or company stock) that you plan to sell soon? Should you do it before 2026?
  • Are your taxable investment accounts suitable for new tax rates?
  • Should you reevaluate your charitable giving strategies?

For a more detailed list of options to consider, consult this worksheet What Issues Should I Consider After TCJA sunset?

What Exactly Will The Changes Be?

Most income tax brackets are affected. For example, the maximum income tax rate increases from 37% to 39.6%. Consult this guide TCJA Sunset Comparison Guide to see a more extensive list of the changes.

Tax law is ALWAYS complex. And the sunset of the TCJA creates a lot of questions.

I routinely run tax analysis and offer tax-savvy advice on saving and investing for my clients. If you would like to know more, maybe we should talk. Just follow this LINK to find a time for us to have a get-acquainted visit.

I think most folks will benefit from a visit with an experienced, highly-trained, CERTIFIED FINANCIAL PLANNER™ professional and Behavioral Financial Advisor in West Saint Paul, Minnesota to help better understand their tax-aware options. I love to meet new people. So, follow this LINK to find a time for us to have a get-acquainted visit.

I am a financial planner who is an advocate for my clients ALL THE TIME – a fiduciary financial planner. I provide guidance based on clients’ best interests, not commissions or sales quotas. I think it’s the best way to serve clients and I am thrilled to work this way all the time.

And yes, I’m still taking on a few great families to be part of my financial planning practice in West Saint Paul, Minnesota and, thanks to Zoom, across the country.

Dunncreek Advisors does not provide legal or tax advice, nor is this article intended to do so.