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It’s not too soon…a look ahead to the 2025 tax year

While we are all busy filing our 2024 tax returns, there are potential tax law changes coming in 2025 that merit paying attention to the impact on your portfolio.  While your current tax situation is top of mind, taking the time now to anticipate future tax changes will give you more time to plan, and if necessary, to act to minimize any impact.  

Provisions of the 2017 Tax Cuts and Jobs Act (TCJA) will expire at the end of this year unless Congress acts. Below are some of the key items we will be monitoring:

After a spectacular run of almost 50% from October 2023 to February 2025, the S&P 500 is now off ~9% from its highs.  Although it might not feel like it, this type of decline is actually normal for the stock market.

Investors who have a well-diversified portfolio that includes other asset classes, such as bonds and international stocks, are still doing OK because the other investments are likely up so far this year.  If you have a portfolio that is mostly US large-cap stocks, it is a good reminder that it helps to be diversified.  

Whether you file your own taxes or pay a professional to have them filed for you, below are some helpful tips that will keep you organized this tax season. In addition, included in these suggestions are ways to maximize your deductions, while reducing your tax liability after year end.

US large cap stocks outperformed all other asset classes for the second year in a row, continuing the 15-year trend.

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Corporate fundamentals are in good shape, equity markets continue to outperform and bonds should help diversify portfolios

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Changing your investments solely because it is a US presidential election year is not the best strategy.  Instead, focus on your long-term goals, risk tolerance, and overall portfolio diversification.  While election years introduce uncertainty, long-term stock market trends are driven by larger economic forces like corporate earnings, interest rates, and global events.  

It is easy to think that things are bad (or will become worse) here in the US and around the world based on what we hear on the news and via social media.  It is even more so during election season!

When the SECURE Act (Setting Every Community Up for Retirement Enhancement Act) was passed in December 2019, it brought big changes to the post-death treatment of distributions from Individual Retirement Accounts (IRAs). One major change was eliminating the “stretch” treatment of distributions for most non-spousal inherited IRAs. Most of us will be impacted by this change if we are a named beneficiary on a non-spousal IRA & the owner of the IRA is deceased.

The S&P 500 recouped its April (-4.16%) decline and posted its 23rd new closing high of the year, up 15.3% year to date.

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When you find yourself with a surplus of cash sitting idle in your bank account, it's time to strategize. Here’s how to put that money to work effectively, making every dollar count. Whether you’re eyeing investment opportunities, planning for future expenses, or simply wanting to boost your financial security, let’s explore some savvy moves you can make.

1. Maintain your Emergency Fund