A new Presidential administration can bring sweeping changes in the tax codes, new rules for how wealth is taxed, and a litany of other legal and regulatory changes. As a result of Donald Trump’s electoral victory on November 8th combined with Republican majorities in the House and Senate, we expect that there will be significant changes starting on January 20, 2017, when Mr. Trump takes office.
Your clients may be feeling a bit of anxiety right now about their financial future, and they are depending on you, their trusted advisor, to be on top of any upcoming changes so they can minimize risk and exploit opportunities. We, too, are watching carefully, and in the weeks and months ahead, we’ll be sharing the latest updates and information you need to help your clients make informed decisions about their estate plans.
In the meantime, taking a proactive approach with your clients in light of the election (including a review of their current tax, financial, and estate plans) will go a long way toward building trust and setting your clients at ease.
We’ll go into more detail momentarily, but here’s a quick overview of what we know so far:
Let’s take a closer look at each of these factors.
Donald Trump has proposed across-the-board reforms in the tax codes, and while he promises to close up some loopholes, the general trajectory of his proposals is toward lowering taxes overall.
You can find the details of his tax plan on his website, but the most pertinent points are:
Remember that any change to the tax laws requires Congressional approval and won’t happen automatically. In spite of Republicans being in control of the Presidency and Congress, there will still be negotiation and compromise reflected in the “final” tax law that comes out of Washington. And remember, the rules are only “final” until the government decides to change them.
Recommendations, assuming President-elect Trump’s agenda is put into law:
While we wait for Inauguration Day, there’s one big thing to focus on to provide the best service to your clients - begin scheduling reviews now.
Between now and when President-elect Trump becomes President Trump, your clients should avail themselves of our services to determine how to make the most of existing rules before they are (likely) changed, and how to adapt to any changes once they occur. Again, the best way to calm anxiety in your clients is by taking a proactive stance. Reach out now to recommend a review of your clients’ current financial and estate plan, if not by the end of the year, then certainly within the first quarter of 2017.
No one knows exactly what the future holds, but it’s fair to say that significant changes to income taxes, estate taxes, and the overall regulatory environment are coming. Change is really the only certainty. The good news is that change doesn’t have to be a negative. By being proactive and adapting, you can continue to help your clients build their wealth while growing your own business. As noted author and leadership expert John C. Maxwell reminds us: “Change is inevitable. Growth is optional.” As a trusted financial advisor, you have the ability to lead your clients toward financial growth, even during the uncertainty that naturally comes with the change of government.
As for your own support system, know that we are staying current with the latest developments of the new Congress and President. As new tax policies are proposed and eventually implemented, we will keep you updated with the latest information and strategies to help you provide your clients with useful estate planning insights. If you have any questions or concerns in the meantime, don’t hesitate to contact us. We are here for you and your clients.