Big Tax Changes Are Coming In 2025

Big tax changes are coming with the expiration of the Tax Cuts and Jobs Act (TCJA). As your CPA, I'm here to help you save before rates rise and deductions shrink.

What's Expiring

The TCJA's individual provisions sunset after December 31, 2025. Unless Congress acts, taxpayers will face higher rates across most brackets, a reduced standard deduction, elimination of the QBI deduction, lower estate tax exemptions, and changes to various credits and deductions.

Act Now To Save

Accelerate Income: If you have flexibility in when you recognize income, 2025 may be preferable to 2026 due to lower rates. Consider Roth conversions, exercising stock options, or accelerating business income.

Maximize Retirement Contributions: Current-year deductions at today's higher rates are more valuable than deductions at potentially lower future rates.

Review Estate Plans: The $13.6 million per-person estate exemption may drop to roughly half. Large estates should consider lifetime gifting strategies before year-end.

Optimize Entity Structure: With QBI deduction expiring, the relative benefits of various entity structures may shift. Evaluate whether your current structure remains optimal.

What We Don't Know

Congress may extend some or all TCJA provisions. Political dynamics make the outcome uncertain. Smart planning involves preparing for multiple scenarios rather than betting on one outcome.

Your Action Plan

Don't wait until December to start planning. Schedule a tax planning session now to model various scenarios and develop strategies that work regardless of what Congress does. Proactive planning provides options; last-minute scrambling limits them.