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Author: Hill Investment Group
The Good, The Bad, and The Ugly of Projected Tax Implications
There has been a lot of talk about the House Ways and Means Committee’s tax proposal. Whether in The Wall Street Journal or from Take the Long View podcast guest, John Jennings’ break down of the good, the bad, and the ugly, speculation is all over the place. As a client of Hill Investment Group, you can rest assured that we are planning for all of the potential iterations.
Below we’ve reviewed the most relevant points for our clients. Have questions? Feel free to reach out to us to discuss how the potential changes may affect you. Set up a time to talk here.
| House Ways and Means Tax Proposals | Current Law | |
| Top Income Tax Bracket | Increase the top individual income tax bracket to 39.6 percent. This new top bracket would start at taxable income levels of $400,000 for single filers, $450,000 for joint filers. Effective 1/1/2022. | The current top tax rate is 37 percent on taxable income over $523,600 for single filers and $628,300 for joint filers. |
| Capital Gains | Increase the statutory capital gains rate to 25 percent. Effective 9/13/2021, subject to a binding contract exception. | The current top statutory capital gains rate is 20 percent. |
| Estate and Gift Tax | Reduce to an inflation-adjusted $5 million. Effective 1/1/2022. | Inflation-adjusted $10 million ($11.7 million in 2021). |
| Roth Conversion | Eliminate Roth conversions for both IRAs and employer-sponsored plans for single filers with taxable income over $400,000 and joint filers with taxable income over $450,000. | A person can convert their eligible IRA assets to a Roth IRA regardless of income. |
Have questions? Feel free to reach out to us to discuss how the potential changes may affect you. Set up a time to talk here.
Image of the Month
It is never too early to start teaching children about taking the long view! Katie Ackerman snapped this photo of her daughter in a perfect pose (Sally, 4) on Dillon Reservoir in Colorado. Follow us on Instagram to see more shared images from our team, or tag us in your own.
Matt Hall Recognized for Thought Leadership
We are excited to announce that, out of 1,000 nominees, our Cofounder and President Matt Hall has been awarded the ThinkAdvisor Luminary Award for Thought Leadership. The recognition is no surprise to our team at Hill Investment Group, as Matt has always taken creative and bold steps to push the industry and clients’ best interests forward. The ThinkAdvisor Luminary Awards shine a spotlight on individuals and firms changing the investment advisory industry where it matters most. Matt is known for inspiring others to “take the long view” and his relentless message that the keys to long-term investment success are patience and discipline.
