10 Timely Tax Issues to Discuss With Clients

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Addressing complex tax considerations is a perennially important part of a financial advisor’s job, but the stakes are raised when significant potential changes in tax policies are being debated at both the federal and state level.

According to Steve Wittenberg, director of legacy planning at SEI, the financial planning community is facing such a moment. On one hand, Democrats and Republicans in Washington are sparring over the question of whether to raise taxes or cut spending as the primary means of controlling the federal government’s debt, and the current tax framework that was established by the 2017 tax overhaul is set to expire at the end of 2025.

On the other hand, various states are moving to make significant changes to their own local tax laws pertaining to such issues as inheritances and capital gains and losses. These include many states principally controlled by Democrats, such as New York, Washington and California, but red-leaning states are also seeing their legislatures debate key taxation and spending policies.

All in all, Wittenberg says, the current moment requires financial advisors to spend some extra time and energy grappling with the evolving topic of tax-aware financial planning. As Wittenberg warns, a truly successful financial plan is impossible without the incorporation of a tax-efficiency lens, and advisors who fail to consider that fact risk being left behind by dissatisfied clients.

See the slideshow for 10 of Wittenberg’s most timely tax insights, all of which can be useful to financial advisors as they help their clients navigate the current tax season and in building their long-term investing and spending plans.

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