Taxing Matters

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.

As we enter the new year, Congress is still deliberating on legislation that could impact the 2022 tax year. The Build Back Better plan was passed by the House in late 2021 but ultimately was not signed into law by the end of the year. The bill has gone through several revisions and could be passed in early 2022. While the act was not passed before the start of 2022, it could still have retroactive tax implications this year.