Recently, congress passed the biggest overhaul of the tax code since 1986.
As far as year-end planning, here are a few reminders on planning opportunities:
- Ordinary Income – in situations where you have flexibility to control the timing between 2017 and 2018, in most cases recognizing this next year will allow you to benefit from lower marginal tax rates.
- State and Local Income Taxes – given the cap being implemented on state and local taxes as a deduction beginning in 2018, you would benefit from the prepayment of any state and local taxes by December 31, 2017.
- Charity – For those tax payers in the highest marginal tax bracket (currently 39.6%), you may consider additional charitable gifts before December 31, 2017 to receive a higher deduction this year versus next year.
- Prepayment of real estate taxes – Check with your CPA, in some situations it can make sense to accelerate your property tax payment (if the county auditor will accept) this year versus next year.