Are Capital Gains Taxes Changing?
There are a lot of questions about President Biden’s Build Back Better plan and potential tax law changes, including an adjustment to capital gains taxes. We feel that it is extremely important to stay up to speed as these laws/rules/regulations change as they can have a significant impact on a families financial plan.
One of the proposals Congress is considering sets the top rate for taxing capital gains at 25%, up from 20% under current law. Another would raise the capital gains tax rate to 39.6% for taxpayers earning $1 million or more. Still another would make the change to capital gains tax retroactive, with a start date of April 2021.1,2
At this point, many ideas are being considered as legislators look for ways to raise revenue to help pay for the Build Back Better plan. Corporate tax rates, individual tax rates, estate tax rules also are on the negotiating table.
As difficult as it may be, the best approach is to wait and see. It would be hasty to make any portfolio changes based on current discussions. An ambitious investor would have to guess what policies will be in the final bill, estimate the financial impact, and determine any needed portfolio changes. That’s a tall order.
This article is for informational purposes only and is not a replacement for real-life advice, so make sure to consult your tax, legal, and financial professionals before modifying your capital gains tax strategy.
At Innovative Retirement, our clients feel confident in us as we continue to stay abreast to the changing investment, tax, political, and economical changes throughout their lives. If you'd like to explore a relationship with us, please reach out for a no-cost no-obligation initial discovery meeting. Our advisors in either New Braunfels, TX or La Crosse, WI can help you assess your goals/objectives and ensure that you have a plan that works for you and your family.
Please complete the form below if you'd like to have a conversation and note that we also are available virtually via zoom!
This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.