At the end of October, the IRS made several announcements regarding taxes in 2017.
Information available for the new year now includes tax rates, standard deductions, exemption amounts and more. While the standard deduction for various filing groups is set to increase by $50 or $100, an additional standard deduction of $1,250 is available for seniors (or the blind); $1,550 if the individual is also unmarried and not a surviving spouse.1
It’s a little late in the year to be changing tax laws for 2017, but there was one instance in 1993 under Bill Clinton’s administration when a tax law went into effect retroactive to the beginning of the year in which it was passed.2
There’s always plenty to think about at the end of the year, but don’t overlook opportunities to prepare for next year’s tax return in December, such as making charitable donations or maxing out contributions to your retirement accounts.3
Before Congress looks ahead to 2017, it still has tax issues to be dealt with by the end of this year. Common tax breaks set to expire at the end of 2016 pertain to mortgage insurance premiums, medical expense deductions and tuition deductions. It’s possible for tax breaks to be extended now that election season has ended, but there are no guarantees.4
One thing both presidential candidates agreed on was the need for tax reform. The Brookings Institution5 and the Tax Foundation6 offer detailed views of several tax policy options that could be up for debate next year, along with their potential impacts.
Neither our firm nor its agents or representatives may give tax advice. We recommend you consult an experienced tax advisor regarding your personal circumstances. Please feel free to contact us to discuss creating retirement strategies through the use of insurance products that can help you work toward your long-term retirement income goals. Please give us a call if we can be of any help, 801-990-5055.
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This content is provided for informational purposes only. It is provided by third parties and has been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed. The information is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet the particular needs of an individual’s situation.We are not affiliated with any government agency including the Social Security Administration.
1 Kelly Phillips Erb. Forbes. Oct. 25, 2016. “IRS Announces 2017 Tax Rates, Standard Deductions, Exemption Amounts and More.” http://www.forbes.com/sites/kellyphillipserb/2016/10/25/irs-announces-2017-tax-rates-standard-deductions-exemption-amounts-and-more/#689a9df0387a. Accessed Oct 28, 2016.
2 Ben Steverman. Financial Planning. Oct. 26, 2016. “The rich get ready for higher taxes under a President Clinton.” http://www.financial-planning.com/news/the-rich-get-ready-for-higher-taxes-under-a-president-clinton. Accessed Oct 28, 2016.
3 Sarah O’Brien. CNBC. Oct. 3, 2016. “Seriously: ‘Tis the season to think about tax strategies.” http://www.cnbc.com/2016/10/03/seriously-tis-the-season-to-think-about-tax-strategies.html. Accessed Oct 28, 2016.
4 Janet Berry-Johnson. Forbes. Sept. 26, 2016. “Popular Tax Breaks Expiring At The End of 2016.” http://www.forbes.com/sites/janetberryjohnson/2016/09/26/popular-tax-breaks-expiring-at-the-end-of-2016/#5193574f50ef. Accessed Nov. 11, 2016.
5 William G. Gale and Aaron Krupkin. The Brookings Institution. Oct. 6, 2016. “Tax reform needed now!” https://www.brookings.edu/research/tax-reform-needed-now/. Accessed Oct 28, 2016.
6 Kyle Pomerleau. Tax Foundation. July 25, 2016. “Details and Analysis of the 2016 House Republican Tax Reform Plan.” http://taxfoundation.org/article/details-and-analysis-2016-house-republican-tax-reform-plan. Accessed Oct 28, 2016.
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