Financial Planning Strategies if Tax Cuts Expire

The Tax Cuts and Jobs Act passed in 2017 made significant tax law changes and reduced taxes and tax rates. If no congressional action is taken, these tax cuts will expire at the end of next year, and rates will revert to where they were in 2017. We're discussing what planning strategies you need to be considering right now should this happen on this episode of Wise Money.
Season 9 Episode 40
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Kevin Korhorn, CFP® offers securities through Silver Oak Securities, Inc., Member FINRA/SIPC. Kevin offers advisory services through KFG Wealth Management, LLC dba Korhorn Financial Group. KFG Wealth Management, LLC dba Korhorn Financial Group and Silver Oak Securities, Inc. are not affiliated. Mike Bernard, CFP® and Joshua Gregory, CFP® offer advisory services through KFG Wealth Management, LLC dba Korhorn Financial Group. This information is for general financial education and is not intended to provide specific investment advice or recommendations. All investing and investment strategies involve risk, including the potential loss of principal. Asset allocation & diversification do not ensure a profit or prevent a loss in a declining market. Past performance is not a guarantee of future results.
Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, and CFP® (with plaque design) in the United States to Certified Financial Planner Board of Standards, Inc., which authorizes individuals who successfully complete the organization’s initial and ongoing certification requirements to use the certification marks.
Intro: (0:00)
Segment 1: (0:11)
Break 1: (10:28)
Segment 2: (13:18)
Break 2: (23:35)
Segment 3: (26:01)
Break 3: (36:20)
Segment 4 (37:16)
Outro: (47:32)

[@Colbe-lx7fb]

With the potential expiration of tax cuts, I’m worried about how my portfolio might be impacted

[@DavidNarteon]

If tax cuts do expire, it’s crucial to reassess your asset allocation. You might want to focus on tax-efficient investments and consider tax-loss harvesting strategies. Also, looking into municipal bonds could be beneficial due to their tax-exempt status.

[@reginaldhufenstien]

Tax-efficient investing is key. Moreover, it’s important to be aware of how the US economy might influence your portfolio, especially with the volatility in emerging markets

[@reginaldhufenstien]

The problem is that people don't have the knowledge needed to succeed in a challenging market. Only highly qualified professionals who had to experience the 2008 financial crisis could help to earn a high in these challenging conditions.

[@Sanchyfab]

I’ve been focusing heavily on U.S. equities. Should I be considering more international investments with an advisor?

[@reginaldhufenstien]

Yes, I've been with Eric Paul Elmer for the last five years or so, and his returns have been pretty much amazing.

[@MikeSTGL]

Man , this going to hit my family hard . Increase taxes , less family credit . Also retirement !

[@Robert-wb9tx]

Can the president extend tax cuts on his own? Doesn’t it have to go through congress first?

[@kaisersouze41]

"....It reduced tax rates for businesses as well". ❤️ how your just so matter of fact about that. Why would tax cuts expire for individuals but not for businesses? Why was the law written that way in the first place??? 🍊 had to give an individual tax cut in order to get his much greater tax cut for businesses passed.

[@SpookyEng1]

Biden is going to increase taxes for everyone (from his own statements).

[@Robert-wb9tx]

On the standard deduction reverting back, you seem to be comparing today’s amount to that of 2017. Won’t the standard deduction in 2026 be adjusted for inflation? I think you did the same for the exemption amt. And while the standard deduction is going to be cut in half, I think you should have included the return of the exemption every time you mentioned it. So while this change will have a big impact, it is being exaggerated when the exemption is excluded from the comment

[@BrianDonoghue]

This is a good point. These guys try to suggest that they have a handle on rules but then fail to accurately explain things. They have one show to prepare for each week and they repeatedly come unprepared.

[@PorscheSpeedster-kz6nc]

@@BrianDonoghueI think you guys might be a little too critical. Yes, the limits for all thresholds should be indexed for inflation through these 10 years but we have to see the publication in late 2025 to know the exact values. Generally they are in the range and the themes still apply.

[@Robert-wb9tx]

I’m merely pointing out that while the standard deduction almost doubled from 2017 to 2018 (increase of 90%) when you take into account the elimination of the exemption it was only an increase of about 15%.

[@Robert-wb9tx]

BTW that 15% was for a married couple no kids

[@Frankenfolio]

Hoping you can clarify. Seems like you are saying if we revert back, then the standard deduction and personal exemptions would revert to 2017 number and not be adjusted for inflation over the past decade?

[@chumbawumba1959]

That is correct. The prior rules around standard deductions, itemized deductions and personal exemptions, child tax credits, etc. ... all revert to what they were in 2017. The only way that wouldn't happen would be if Congress didn't renew the Trump TCJA legislation but instead mucked around with these elements.

[@Ehtizan-Editor-002]

Hey Wise Money Show, I just watched your video and I must say that it was really informative and well-made. I was wondering if I could help you edit your videos and repurpose your long videos into highly engaging shorts? I can also make high CTR thumbnails for your channel

[@PorscheSpeedster-kz6nc]

Question: does a Roth IRA get included in the $14 million Estate Tax limit? Or is this exempt from this federal estate tax?

[@SpookyEng1]

It is included

[@rodneylw10]

I have a question. I am a teacher with a pension and social security. I retired Friday at 62. I am not getting Soc Sec yet but will next month. I have over 127K left in two 403b accounts. I am single and have thought about converting it to a Roth but I am not sure it would make that much difference for me. I have CDs well over $175K now and savings of $72K. Would you suggest combining the $127K 403b into an IRA or Roth? I live in FL so only federal tax. Thanks.

[@WiseMoneyShow]

Hi Rodney! Thanks for your question. We added it to our question bank and will hopefully get to it on an upcoming show.

[@tinarhodes4188]

How many people have north of 28 million and are watching a You tube video for advise... lol, not many! Those folks have there own expert team(s). Keep this financial planning channel toward the lower end of earners please.

[@dale5710]

Glad I had nothing else to do today as I got to spend an hour for 5 minutes of information.

[@epdugas]

I doubt anyone with 14 or 28 million watched this show 😂 why waste time on this? 😂😂😂