Hi Reader ,

Do you remember the good ol’ days of 2016?

Depending on your immigration journey, you might have not even reached the US, so I can tell you a thing or 2 about the US:

• Donald Trump had just become President
• It felt weird to be a brown-skinned immigrant in some spaces
• The tax rates were much higher than now

The Republicans passed the Tax Cuts and Jobs Act (TCJA) that simplified taxes for a lot of people by increasing the deductions you can take, raising the brackets and helping businesses out.

Great, right?

Here is what we got:

• Reduced tax rates - TCJA lowered the marginal rates for most individual tax brackets.
• Increased deductions and tax credits - TCJA doubled most deductions like the standard deductions, child tax credit that MOST tax filers took advantage of, reducing the need to itemize.
• Capped certain deductions - TCJA capped the state and local tax deductions and reduced limits on mortgage/home equity deductions.
• Estate taxes - The amount you could leave to your heirs was doubled under TCJA.

Well humans tend to suffer from recency so with COVID, inflation, layoffs, etc, most people have forgotten that those provisions were permanent for business but TEMPORARY FOR INDIVIDUALS.

That means the TCJA brackets are set to expire in 2025 (unless renewed by Congress)

So you need to prepare for the case that taxes go up.

What are some ways to do this?

1. Maximize Roth Contributions: Contributions to traditional 401ks are good, but if your bracket is changing quite a bit, then (depending on your goals) I would focus on putting more into Roth accounts right now. Thats not just a roth401k, but also a backdoor Roth or Mega Backdoor Roth strategy(if your employer offers it!) These dont lower your tax today, but they reduce your LIFETIME tax paid!
2. Take Advantage of Deductions and Credits: Explore available deductions and credits, such as those for education expenses, charitable contributions, and home mortgage interest. Every deduction and credit you qualify for can help reduce your tax bill.
3. Consider Tax-Efficient Investments: Invest in assets that offer tax advantages, such as municipal bonds or tax-deferred investment accounts. These investments can help minimize the taxes you owe on investment gains.
4. Consult with a Financial Planner: These are moves that you are trying to be proactive with, rather than reactive, so a financial planner can provide personalized advice tailored to your specific financial situation. They can help you navigate the changing landscape and identify opportunities to optimize your tax strategy. Not only that, their fees should be deductible on your taxes in 2026 if the TCJA rolls back!

Happy tax planning!

That’s all for today.

See you next month!

​
P.S. - I also do Ask-Me-Anything Fridays on Linkedin, so join me there if you have questions in the future!

Fun Corners of the Internet

• I read the book 'How to Hide an Empire' recently and it is fascinating how much is left out of history textbooks.
  ​Here is a talk the author gave that briefly goes over parts of the book if you are curious!
• Do you forget stuff a lot? I have 7000+ things are a business owner and have been looking into brain dumping info in one place. Its called Building a Second Brain, it might help you too!

​

Whenever you're ready, here are 2 ways I can help you:

• If you're looking for support with your finances, you can start a (free) conversation with me to see how I can help. Here is my calendar for a FREE 30 minute consultation

• Not ready to commit? Email me your questions and I am happy to if I can get them answered in future editions of this newsletter.