Broker Check

Tax Cuts Job Act Announcement

| December 22, 2017
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Happy Holidays and Happy New Year,


Nothing like having a massive piece of legislation passed 2 weeks prior to the end of the year, right before Christmas and as Congress takes their holiday break… ah Washington’s gift to all of us 😊.

The good news is that except for the change to the threshold % to medical deductions in 2017; everything else is slated to affect your taxes in 2018 and beyond, so we have time to plan.

And planning is the key to our message.  You will be hearing a lot in the news that the package is good, bad, helps, doesn’t help, etc.  However, the truth is no one really knows all the details, including Congress!

The Tax Cuts and Jobs Act was just passed and as of this writing is awaiting the President’s signature which is all but a fait accompli. So, figuring out how the legislation is going to impact you and your business, if you have one, could take the entire year of 2018 as Congress is already talking about making amendments to the Act.

It is going to require lots of patience and due diligence to make sure you are legally getting all the tax savings you are entitled too.

There is a lot in the tax package.  Here is just a sample of just how confusing the Act is and how clarification is necessary before we can recommend specific strategies:


  • New Deduction for S-Corp and Pass-Through entities:
    • What exact types of businesses are excluded? We know service businesses are, but how do you know if you are classified as one of the excluded businesses?
    • Do you need to have any employees to get the deduction?
    • Should you convert to a C-Corp, or could it cause taxes to go up to 41%?
    • Phase-out starts at $315,000, what about income over $500,000? Will you get any deduction?

  • New Deferral Election of Restricted Stock Units (RSU’s):
    • Employees can now defer, for income tax purposes, a certain amount based upon certain guidelines, based upon a date five years after the first date of the employee’s right to the stock becomes “substantially” vested. The substantially vested part is what isn’t clear.
  • State and Local Tax Deduction Limited:
    • Capped at a combined $10,000, which will significantly reduce your itemized deductions, however, will the new “lower” tax rates and reduction in the AMT (Alternative Minimum Tax) be enough to offset your loss of these deductions?
  • Estate and Gift Tax Increased Exemption:
    • Increased to $11.2 million per person in 2018 ($22.4 million per married couple). However, these levels “sunset” in 2025 back to 2017 levels plus inflation, so how do you plan if you live another 9 years?


Our recommendations will be gradual and ongoing as the “Tax Cut and Jobs Act” becomes clearer and amendments are instituted.  We will not rush to judgment based upon media “hype” or “what I have heard” comments.


For 22+ years we have had a saying at WMGNA, Your taxes affect everything you do, and everything you do affects your taxes!”


Have a happy and healthy New Year,


Brian and Dan

Call or email us with any questions or issues, and please feel free to let family members, friends or colleagues know that we are available to help them with a mission to minimize taxes.

Disclosure – Securities and advisory services offered through Triad Advisors, LLC., Member FINRA/SIPC, a Registered Investment Advisor. Additional advisory services offered through Wealth Management Group of North America, LLC (WMGNA), a Registered Investment Advisor. WMGNA and Triad Advisors, LLC. are separate and unrelated companies.


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