Wolters Kluwer: It’s time for taxpayers to prepare for the next tax season
What: Most of the steps available to taxpayers that affect their 2021 tax return must be completed before the end of the year. Areas of interest often include speeding up deductions, deferral of income, reviewing investment portfolios for possible realizations of capital gains or losses, charitable giving and lifetime giving to members. of the family.
However, the 2021 end-of-year planning might look a little different. The
Why: If and when the Build Back Better bill is enacted, it might be too late to do year-end planning in response. Some of the provisions may come into effect on the enactment date, others, such as changes to the capital gains rate, could be retroactive and already too late for planning, and some could come into effect as of 2022 or later. late. Taxpayers would likely benefit from talking to their tax professional and accountant about any year-end changes that might make sense to them. Here are some things taxpayers might want to consider:
All taxpayers may want to consider year-end charitable giving to take advantage of the
Taxpayers may want to consider what might be their last chance to make Roth IRA conversions, although
With possible inheritance and gift tax changes, including reducing the exemption amount and eliminating the benefits of assignee trusts and valuation discounts, the end of the year would be a good time for taxpayers to revisit their estate plans and possibly consider end-of-year lifetime gifts.
With a possible significant increase in
While capital gains rates may increase for wealthier taxpayers, the current proposed effective date is
Intermediate business owners should consider reviewing possible changes to the 20% deduction for qualifying business income, rejection of excess business losses, changes to the taxation of deferred interest and a set significant changes to the taxation of partnerships.
Richer taxpayers may want to consider accelerating income rather than the usual deferral of income
Richer taxpayers may also consider deferring deductions rather than the usual acceleration of deductions.
Who: Tax expert
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