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Four Ways To Cut Your Taxes

Updated: Mar 31, 2022

  • Six out of 10 affluent adults expect to change their financial plans due to new tax law.

  • The estate and gifting exemption is up to about $11 million per person, double the levels under the old law.

  • Entrepreneurs: Grab a 20 percent deduction against qualified business income.

We're only a couple of months into the new year, yet accountants are already drafting strategies to help their clients save on taxes under the new tax code.

A survey from the American Institute of Certified Public Accountants showed that 63 percent of affluent individuals said they were likely to tweak their financial planning strategies.

Last September and October, the organization took an online poll of 507 adults who have at least $250,000 in investable assets or more than $200,000 in household income.

The Tax Cuts and Jobs Act took effect in 2018, rolling out some major changes to the way individuals and businesses file their taxes. Key changes include the doubling of the standard deduction to $12,000 for singles and $24,000 for married couples who file jointly, the elimination of personal exemptions and sweeping changes to itemized deductions.

That means 2018 was the first year in what could be a decades-long planning process.

"You don't want to jump into the new tax law, figure something out and then stop making tax planning a priority," said Dave Stolz, a CPA and member of the AICPA's Personal Financial Specialist Credential Committee.

"Every year, there's a little tweak and it's a little clearer," he said. "Don't look at tax planning as a one-time event; it's an ongoing thing."