2011 Budget Control Act: Tax and Planning Implications

The Budget Control Act will result in the formation of a bipartisan joint committee charged to address deficit reduction and present legislation that can be voted upon prior to year end. They are charged with proposing changes to raise $1.5 trillion over 10 years. The specific form deficit reduction will take is unknown. That uncertainty alone has significant planning implications. Unfortunately, many clients will interpret added uncertainty as another excuse to defer planning. But, more than ever, taking a “wait and see” approach may result in clients realizing a “wait and pay” result.

Authors

Agenda

Introduction to the Budget Control Act

• Guesswork - But Why It Is Important to Consider
• Communicating With Clients

Overview of Already Proposed Tax Changes

• Estate Tax Changes Already Proposed

Tax Rate Changes

• Income Tax Changes
• 2013 Medicare Tax on Earnings
• 2013 Medicare Tax on Passive Income

Deductions

• Deductions Changes
• Home Mortgage Interest Deduction
• Charitable Contribution Deduction
• Medical Expense Deduction
• State and Local Tax Deduction

Inflation

• Stealth Inflation Adjustments
• Switch CPI Benchmarks

Gross Income Modifications

Other Planning Considerations

Conclusion

Additional Formats