Investment Update

OCT 2017

 

Your FP/CM Newsletter – 3Q17

YEAR-END 2017 INCOME TAX PLANNING
VINCE MARSDEN, Partner, SVP of Financial Planning

 

Now that summer is over, it is time to think about possible year-end 2017 tax saving strategies.

 

Republicans have announced a framework proposal for tax reform, which includes a reduction in the number of individual income rates from seven brackets to three of 12%, 25% and 35%, as well as the adjustment/elimination of certain tax deductions and tax credits.

In addition, they propose the elimination of the Alternative Minimum Tax, as well as Estate & Transfer Taxes. Corporate taxes would decrease from 35% to 20%, and taxes on pass-through entities would be at 25% rather than the current maximum of 39.6%. However, the final reform bill will almost certainly differ from the current proposal and it is questionable whether passage would take place in 2017.

 

In addition, even if a tax bill is passed in 2017, it could be enacted prospectively, taking effect 01/01/2018 rather than being retroactive to the start of 2017.

 

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“In the short-term, it is possible to make a lot of money from an advisor’s poor process — or lose a lot from a perfect one. Our clients look to us for a good process with a focus on the long-term. Smart investors recognize these differences before they commit wealth.”

 

— Aaron Cohen, President