“The Need for Financial Planning” covers financial planning topics and ties in data suggesting the opportunity for new and prospective advisors to improve America’s financial health.
Since its passing in late 2017, you have probably heard of the Tax Cut Jobs Act (or TCJA). With tax season in full swing, you have probably seen it being mentioned even more frequently.
But perhaps you’ve always had your tax professional handle all of your matters and aren’t really sure of the new law’s significance.
As prospective financial planners, the passage of TCJA cannot be understated.
Major changes to the tax law do not come around very frequently. The last? 1986 (!). Yes, it’s been over thirty years since the last major update when the Tax Reform Act of 1986 was passed.
So what were the major changes?
To start, the handful of tax forms used previously, 1040, 1040A, and 1040EZ, have been consolidated to just one 1040. But that’s not really all that impactful to prospective clients’ tax situation.
More noteworthy? A reduction to individual income tax rates and also a significant reduction in corporate tax rates.
In addition, there are no more personal exemptions. However, the standard deduction for the 2018 tax year nearly doubled for all filers.
These are just several highlights, but TCJA brought significant change. And that kind of change inherently brings the additional need for the tax guidance of financial planners.