Other Tax Considerations

The following is not tax/legal advice, see the list below of 2024-2025 tax considerations that are still up in the air:

1. Extension (or Expiration) of the 2017 Tax Cuts and Jobs Act (TCJA)
2. What Might Change: Many of the individual-side provisions (such as lower income tax brackets, the higher standard deduction, and the 20% pass-through deduction) expire after 2025.
3. Impact on Investors: If not extended, taxpayers could face higher marginal rates and lose popular deductions, resulting in higher overall tax bills—particularly for small-business owners, freelancers, and real estate investors.
4. Possible Return of the Alternative Minimum Tax (AMT) for More Taxpayers
5. What Might Change: Under TCJA, far fewer people are subject to AMT. Once those TCJA provisions expire, the old AMT thresholds could snap back into place.
6. Impact on Investors: High-income earners, especially those in high-tax states who previously avoided AMT thanks to the TCJA’s higher exemptions, might be pulled back into it. AMT can reduce or eliminate deductions like state and local taxes (SALT).
7. State and Local Tax (SALT) Deduction Cap Adjustments
8. What Might Change: The current SALT deduction is capped at $10,000. Talks include raising that cap—possibly doubling it for married filers—or reverting to pre-2018 rules.
9. Impact on Investors: Those who own property in high-tax states or who pay large amounts of state income tax could either see a bigger federal deduction (if the cap is raised) or no change (if the cap remains). But the politics are contentious and still very uncertain.
10. Shifting Treatment of Tips
11. What Might Change: Proposals exist to exempt tips from federal income tax (though likely still subject to payroll taxes). This would be a brand-new carve-out.
12. Impact on Investors & Business Owners: Hospitality and service businesses could see changes in employee wage structures and labor costs. For individuals who earn tips—or have family members who do—this could yield tax savings. It may also influence hiring in tipped industries if labor becomes more affordable overall.
13. Overtime and Social Security Tax Exemptions
14. What Might Change: Some proposals would make overtime pay or Social Security benefits partially or fully exempt from federal income tax.
15. Impact on Retirees & Employees: Retirees who rely on Social Security might keep more in their pocket if benefits are no longer taxed. Overtime-exempt pay could encourage more people to work extra hours if it’s taxed less. Both ideas are politically complex and still lack detail.
16. Child Tax Credit (CTC) Changes
17. What Might Change: The TCJA doubled the CTC from $1,000 to $2,000 and raised phaseout thresholds. The enhanced CTC expires after 2025. Lawmakers may debate making it permanent, adjusting the amount, or changing eligibility.
18. Impact on Investors with Families: Families will want to watch closely. If the credit decreases or more children become ineligible, overall tax bills could climb—affecting disposable income, potential savings, and investment dollars.
19. R&D Expensing and Bonus Depreciation
20. What Might Change: Pre-2022 rules allowed for generous “bonus depreciation” and immediate expensing for R&D costs. Those have begun phasing down or reverting to slower write-offs.