Prepare Now for Big Tax Law Changes Coming in 2025
It’s possible that Congress will extend some tax provisions, but with the current political climate and upcoming election, it’s wise to take action now and make the most of the current tax laws!
ESTATE AND GIFT TAXES: You can transfer up to $12.5 million individually or $25 million as a couple without triggering federal taxes. This exemption is set to halve in 2026, so consider strategies like annual gifts, 529 accelerated gifts, or irrevocable life insurance trusts (ILITs) to reduce your taxable estate.
INCOME AND CAPITAL GAINS TAXES: Income tax rates are expected to increase as brackets revert to pre-TCJA levels. Take advantage of current lower rates with Roth IRA conversions, income shifting, and capital gains harvesting.
QUALIFIED BUSINESS INCOME DEDUCTION (QBI): The QBI deduction, allowing up to 20% off income from pass-through entities, sunsets after 2025. While there’s pressure for an extension, planning now is crucial.
PROACTIVE STRATEGIES: Plan ahead to leverage current tax benefits and prepare for potential changes. The last half of 2025 will be hectic for tax professionals, so starting now can help you maximize your tax savings.
Click here to read this article.
Davis & Hodgdon CPAs works with individuals to capitalize on all applicable deductions. Our accountants have the experience required to make sure that nothing is missed! For more information or to set up an appointment please click here or email [email protected].
Recipients should not act on the information presented without seeking prior professional advice. Additional guidance may be obtained by contacting Davis & Hodgdon CPAs at 802-878-1963 (Williston) or 802-775-7132 (Rutland).
See also:
