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Less estate tax planning may be better for older HNW clients: Tax Strategy Scan

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Our weekly roundup of tax-related investment strategies and news your clients may be thinking about.

Less estate tax planning may be better for longer-living rich
Thanks to longer retirement horizons, rich households may benefit from doing less tax-related estate planning, experts told Bloomberg. “People used to do a lot of wealth transfer planning when they were in their 60s, and I’m seeing people waiting longer to focus on transfers of wealth to the next generation or generations,” according to Jessica Galligan Goldsmith, co-managing partner of Kurzman Eisenberg Corbin & Lever. They’re not as willing to “simply give up large chunks of wealth because there’s more concern that they will ultimately need some back.”

Should clients be worried about the 'tax torpedo'?
Clients should plan carefully to help minimize the tax bite on their income after they retire, writes CFP Roger A. Young for Kiplinger. That’s because up to 85% of their Social Security benefits will be taxed if their taxable income in retirement exceeds a certain threshold, he says. “This can create a unique situation to avoid: what researchers dub the ‘tax torpedo.’ You’ve been hit by this torpedo if you pay a high marginal tax rate because additional income causes more Social Security to become taxable,” says Young.

Clients still waiting on their tax refund? Here’s why it could be delayed
Clients may still be waiting for their tax refund if they opted to file their returns on paper, according to the Motley Fool. The refund may also be delayed if clients made mistakes on their returns. In some instances, some refunds for those opting for direct deposit may be delayed if they entered the wrong bank account or routing number.

5 ways to cut your 2019 tax bill now
Clients hoping to pay fewer taxes for 2019 should start making moves now, according to USA Today. That could be as simple as determining what filing status can enable greater savings — and boost pretax contributions to 401(k), IRA and health savings accounts. Investors should review their portfolios to see where they can access additional tax breaks. That means paying close attention to what clients can control, like charitable deductions. For example, “bunching your charitable contributions into a single year, rather than contributing smaller sums over several years, may put you over the new standard deduction hurdle,” says CPA Robert Westley, a member of the AICPA’s PFS Credential Committee.

Low-tax states top among best places to make a living in 2019
Wyoming, Washington, and Texas are among the best states for workers to make a living this year, according to data from MoneyRates.com on Fox Business. The states are ranked according to various factors, including income taxes, median incomes, cost of living and unemployment rates.

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