10/24: Local financial planner talks about Trump's tax plan - WQOW TV: Eau Claire, WI NEWS18 News, Weather, and Sports

10/24: Local financial planner talks about Trump's tax plan

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Eau Claire (R.W. Baird & Co.) -- Trump's tax plan is one of the most recent proposals from the White House, but what is it exactly?

"Unified Framework for Fixing our Broken Tax Code".  It's similar to the 2016 Campaign, but still a long way from a final bill.

What is the objective of the proposal?
Repeats the President's goals of making tax reporting as simple as completing a postcard-size form, providing tax relief for middle-class families and maintaining a progressive tax system, all while also broadening the overall tax base.

How does it accomplish this?
Simplify the tax code and reduce loopholes.

  • Fewer and lower tax brackets
  • Fewer deductions and credits
  • Higher Standard Deduction, almost double! = less people itemize

What stays the same?

  • Deductions for mortgage interest & charitable giving
  • tax benefits for higher education and retirement savings
  • Child Tax Credit significantly increased

What planning strategies should be considered at this time?
As we are nearing the end of 2017, the less likely the changes will go into effect this year. If it appears most itemized deductions will be eliminated in 2018, consider accelerating as many deductible expenses into 2017. Charitable contributions would be the exception as those would still be deductible in 2018, but if you're not going to exceed the new higher standard deduction in 2018, you might want to accelerate those into 2017 as well.

Any tax strategy should be evaluated with a tax professional based on each taxpayer's own personal situation.

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