Nest eggs have become a hard egg to crack. For starters, Roth conversion can no longer be recharacterized. Contribution limits have been raised for certain retirement plans, such as 401(k)s and 403(b)s. Income phase-out ranges for IRA contributors have also changed. Social Security benefits and withholding thresholds have both increased. With all of the tax changes that have come to retirement savings, it’s perhaps never been more important for your clients to consult their trusted CPA for advice.³
The new tax law may rub SALT into the wound. The state and local tax (SALT) deduction for income and property taxes is now capped at $10,000, which could have a negative impact on taxpayers in states with high state and local taxes.⁴
AMT victims may finally get a reprieve. As you know, families with higher incomes have historically had to calculate their taxes under the standard tax system and under the alternative minimum tax (AMT) system and pay whichever was higher. However, because the AMT didn’t keep up with inflation, it started to affect an increasing number of taxpayers. The new tax law adjusted the amounts for inflation, which means many that were previously affected by AMT will not be anymore.⁵

These five items are just a few of the many changes to America’s tax code. However, the most important thing for your clients to know about the new tax law is who to turn to for advice. Your clients likely have questions – who better to answer them than you?

¹AARP. https://www.aarp.org/money/taxes/info-2018/new-standard-deduction-fd.html

²Wisebread. https://www.wisebread.com/12-things-you-should-know-about-the-new-tax-law

³Time. http://time.com/money/4990121/401k-ira-contribution-limits-2018/

⁴Smart Asset. https://smartasset.com/taxes/trumps-plan-to-eliminate-the-state-and-local-tax-deduction-explained

⁵The Motley Fool. https://www.fool.com/taxes/2017/12/29/your-complete-guide-to-the-2018-tax-changes.aspx

5 Quick Highlights of the New Tax Law