Is tax planning part of your practice? Are you discussing the impact of taxes with your clients? Or using the conversation to engage prospects? If not, the time to start is now.
You are already aware of the role taxes play in the financial products and solutions you recommend to your clients. Your clients are probably clued into this as well, but are they aware of the potential storm brewing that could dramatically change the way taxes will impact their retirement plan?
The Perfect Storm
Factors that could impact your clients’ taxes include:
- The expiration of provisions in the Tax Cuts & Jobs Act of 2017. Provisions set to end in the next few years include:
- Increased base exemption for estates
- Individual tax bracket changes
- Higher standard deductions for individuals
- Increased child tax credit
- Increased exemption amount and phase-out for the alternative minimum tax
- Growing federal and state debt due to stimulus bills
- Biden’s tax plan, which includes:
- The American Jobs Plan – $2 trillion
- The American Families Plan – $1 trillion
The end result could mean looming tax increases and financial uncertainty. Again, now is the time to start having these conversations.
Because the tax environment ahead remains unclear, we can expect to see tax hikes in at least some areas. This offers several planning opportunities to present to your clients. However, it is important to act now before any legislative changes take place and work to establish flexible strategies.
Some of these opportunities can be found within the SECURE Act. Passed in 2019, the act contains provisions that offer individual relief by eliminating the IRA age cap for contributions and increasing the age for RMDs. The potential for higher taxes also makes tax-advantaged vehicles like cash value life insurance (IULs) or annuities more attractive to clients.
People at or near retirement age could face a higher tax burden due to the uncertainty that lies ahead. Rather than wait for Washington to shed some light on the unknown, be proactive and get to work now on protecting your clients’ wealth.
IAMS’ 2021 Macro Tax Planning Kit has the resources you need to get this critical conversation started.
The kit includes:
- Factfinders, questionnaires, and checklists
- Presentations on the SECURE ACT, tax planning in retirement, and more
- A consumer-facing Smart Wealth Accumulation (IUL) guide
- Updated tax tables
- Turnkey prospecting letters and social media posts
- A 1040 Guide
- And much more!
Click below to request your complimentary 2021 Macro Tax Planning Kit today.