Last-minute changes also include restoration of adoption credit and elimination of limits on interest deductions for car dealers.
If the tax bill becomes law, the recharacterization repeal will be effective after 2017
Some key differences from House bill include how mortgage deduction and estate taxes are treated.
The House bill seeks to limit the 25% rate to manufacturers, but will still creates opportunities for strategic tax management.
Elimination of alimony deduction could complicate future divorce settlements.
Government website offers tips to protect personal data, but gaps may remain.
Provisions in the tax bill will affect advisers and their clients alike.
While pre-tax 401(k) contribution limits are off the table (for now), the Republican tax bill nonetheless makes changes to retirement savings plans.
Market-driven gains and active-fund outflows mean high distributions.
The proposed measure leaves 401(k) plans alone, but makes sweeping changes in many other areas, including mortgages, property taxes, pass-through income and charitable deductions.
Clients may need to navigate shifting tax brackets, re-characterizations of Roth IRA conversions, reconsidering the value of charitable contributions, and restrictions on the mortgage interest deduction.
Proposed legislation is designed to give manufacturers the lower 25% tax rate, not professional service firms such as financial advisers, lawyers and accountants.
If 401(k) pre-tax contributions are curtailed, several groups plan to launch nationwide campaigns against the effort.
He believes reducing the pre-tax contribution limit on traditional 401(k) plans and encouraging 'Rothification' would lead the middle class to save less for retirement.
Understanding options with residential deductions is a great way to add value for clients.
These underutilized strategies give financial advisers the edge with clients.
Sweeping bill to be released in just five days.
Despite the president's assurances that 401(k) plans would remain as they are, House Ways and Means Chairman Kevin Brady doesn't rule out changes to the retirement accounts.
GOP reportedly had been considering reducing the cap on the annual amount workers can set aside for 401(k)s.
Perhaps if the time allotted is expanded, cooler heads will prevail.
