With the election coming up in November, it is important to understand what is at stake in regard to tax policy and its impact on the economy at large.
At the end 2025, the Tax Cuts & Jobs Act from 2017 is set expire if not renewed or extended. This has been a significant tax law for taxpayers, particularly middle income taxpayers and small business owners. Here are some features of the tax law that have provided significant tax savings:
1. C corporations taxed at a flat 21%
2. 20% deduction for Sole proprietorships and pass-throughs (S Corps and LLCs)
3. Increased standard deductions across the board (Single, MFJ, MFS, H of H)
4. Expansion of the tax brackets (more income taxed at lower rates)
5. Child credit of $2000 per child and $500 credit for other dependents
These are just a few of the items that will go away if the law is not extended or renewed. When voting in the upcoming election, it is important to consider the impact of one's vote on important tax policy and which candidates are likely to continue supporting this important legislation or would support repealing it.
After the election, taxpayers will have to be vigilant in their tax planning regardless on which candidate wins. However, it will be much better for taxpayers if the candidates that get elected will support this legislation.
LFC can help taxpayers with their tax planning needs. Contact the office to set a time to discuss your individual situation:
Appointments: Online scheduler for Liberty Financial Consulting Inc. in Roseville, MN (fullslate.com)
Email at: info@lfconinc.com
