While it’s too soon to know exactly how we should guide our clients through potential tax changes, based on what we do know at this point we are recommending that our clients defer income and accelerate deductions.
1. Prepay your January property tax & Q4 CT estimated taxes – Because the tax bill will cap the deduction for state and local taxes at $10,000 starting next year, you can maximize their deductions in 2017 by paying your January property taxes and Q4 estimate before Dec. 31.
2. Make bigger charitable donations before year end – The GOP tax bill almost doubles the standard deduction to $12,000 for single people and $24,000 for married couples. That means taxpayers whose deductions fall below those caps won’t be able to itemize starting in 2018.
3. Defer income until 2018 – Under the GOP provisions many taxpayers will find themselves in a lower tax bracket next year.
Please know that we are reading everything we can about the new tax plan and will keep you up to date with information that you need to plan ahead for 2018.
As always, we are here to help.