Taxing Matters

After a busy few weeks of haggling, headlines, and holdouts, Congress delivered a sweeping piece of legislation for President Trump’s signature prior to a self-imposed July 4th deadline. Nearing a thousand pages, the law has major implications for taxes, healthcare, government social programs, defense, and immigration. Parsing through the messy politics and into the policy details is key to understanding how you may be affected, and if so, how we can best plan for the changes together.

Looking ahead to 2025, all eyes are on the sunsetting Tax Cuts and Jobs Act of 2017 (“TCJA”). As written, much of this extensive tax reform bill is set to expire at the end of 2025, unless Congress can extend the provisions or make them permanent. The portions set to return to their previous levels include cuts to individual tax rates, expansions of various deductions and credits, and the significant increase in the federal estate tax exemption.

Enacted in 2017, the Tax Cuts and Jobs Act (TCJA) was one of the most extensive tax law reforms in over 30 years. Changes under the TCJA were wide-ranging and impacted individuals, estates, and businesses. The legislation is set to “sunset” on December 31, 2025, reverting back to the rules in effect pre-2018.  

Beginning January 1, 2024, there is a new Federal filing requirement for small businesses that comes with large civil and criminal fines and possible jail time for noncompliance. To be in compliance, all small businesses (S Corps & C Corps and LLCs) need to file a Beneficial Ownership Information Report (BOI) with the Financial Crimes Enforcement Network (FinCEN).

As we enter the new year, we highlight key IRS inflation-adjustment changes for 2024. Here is what you need to know: The IRS has released inflation adjustments for over 60 tax provisions for the 2024 tax year.

On October 4, 2023, Massachusetts Governor, Maura Healey, enacted comprehensive tax legislation that will modify a wide range of Massachusetts tax laws, including those related to estate tax.

Significant changes are coming for Bay State taxpayers in 2023 with the implementation of the “millionaire’s tax” and the long-awaited deduction for charitable contributions.

In August 2022, President Joe Biden signed into law the Inflation Reduction Act (IRA), which includes tax incentives you may be able to take advantage of as they relate to energy efficient home improvements and the purchase of electric vehicles.

On December 29, 2022, President Joe Biden signed the SECURE Act 2.0 into law. The legislation includes many changes affecting how Americans can save for retirement. Through tax credits, increases in retirement savings limits and delayed distribution requirements, it benefits both individuals who save for retirement and employers offering retirement plans.

In state tax news, Massachusetts filers may be eligible for a refund based on their 2021 tax filing. Chapter 62F is a general law that requires the Mass. Department of Revenue to issue a refund to taxpayers if total tax revenues in a given fiscal year exceed an annual cap tied to wage and salary growth in the Commonwealth.

Echoing the challenges described in the Economy section, the IRS continues to struggle with impacts from the pandemic and staffing shortages.

With our Tax Department working diligently towards the April deadline, we wanted to provide a brief update on recent legislation for retirement savings.