The new federal tax-reform law deliver the goods a succeeded some substantial changes to the U.S. tax code and obviously has a major impact on American taxpayers’ pecuniary plans.
We spoke with several members of the CNBC Digital Economic Advisor Council and had them weigh in on strategies they are recommending to their customers based on the new tax law.
The new law will affect millions of taxpayers in 2018, when most of the edibles kick in. That’s why understanding how it will impact you is so important, these advisors said. Designing now can help you sidestep some pitfalls while maximizing your turn ins next year, they explained.
“It’s an individual thing on how it impacts people,” replied Ron Carson, founder and CEO of Carson Wealth Management Group. Since the tax law swaps will have an impact next year, Carson said it’s key for taxpayers to “proper get out, sit down and talk to your advisor.”
Carson said it’s important to look forward to if there are any changes or adjustments that need to be made.
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“For criterion, with interest rates so low, maybe some of the things you are doing to put off taxes no longer make any sense,” he said. “It’s an individual decision.
“There isn’t any hand down a judgement generalization,” Carson added. “You need to roll up your sleeves and do the blueprinting.”
The GOP tax law caps state and local tax deductions at $10,000, which is well beneath the average amounts claimed by individuals residing in states such as New York, California and New Jersey.
Cathy Curtis, institutor and owner of Curtis Financial Planning in Oakland, California, said that’s a big consideration for her clients in the Golden State.
“Tax reform is a big deal for my clients in California, because we’re a high-tax position and they are looking at the loss of several SALT deductions,” she said. “It’s booming to cause a lot of my clients a bigger tax bill.
“Some of that will be equalize by the lower tax rates, of course, but it kind of depends on what tax bracket you’re in.”
The country-wide economy has been strong, and forecasts for next year have been stumble over murdered up a bit due to the tax cut. However, there’s a lot going on right now, and there’s no way to tell what the long-term fiscal impact will be from the tax changes. With that said, that’s what is respect her clients awake at night, said Carolyn McClanahan, founder and big cheese of financial planning at Life Planning Partners.
“My clients are excited there saving money now, but they’re worried about what [tax changes] are active to do to the economy and its impact on the deficit,” she said.