Tax Reform Signed into Law

The newly signed legislation known as Tax Cuts and Jobs Act of 2017 has made widespread changes to the Internal Revenue Code. The tax reform measure is extremely complex, and the full effects of many provisions are still unclear. Most of the provisions have become effective January 1, 2018, of which include lower individual income tax rates and a lower corporate tax rate of 21%. However, many of the provisions for individuals automatically expire after 2025, which would require the approval from a future Congress and president to extend them beyond 2025. This means lower tax rates in the near term could be followed by rate increases down the road. Overall, the tax reform measure highlights the importance of a financial planning strategy that can adapt to change.

The following articles,
“What the Tax Reform Bill Means for Individuals“
and
“How Tax Overhaul Would Change Business Taxes“
published by Journal of Accountancy, are a good resource to provide more information regarding the major tax law changes. While the measure will have wide-reaching effects on investors, it’s important to remember that taxes are only one of many factors in making financial decisions. We encourage a disciplined saving and investing approach, along with investment and tax diversification to help investors achieve their financial goals.

Petersen Hastings team is continuing to learn about and understand ways to strategically plan for the impact the new tax bill will have on those we serve. Feel free to contact your trusted financial advisor to discuss further.

*Disclaimer: The provided information is not tax advice, nor should it be construed as such. We recommend speaking with a licensed tax professional before making any tax-related decisions. The information provided is meant to be informational.