There is always a certain degree of guesswork that goes into year-end tax planning, but this year there is the added uncertainty surrounding what the tax code will look like after Washington completes the overhaul of our tax system. The income tax rates for many individuals and businesses may decrease; the definition of income subject to tax may change considerably as well. Many itemized deductions that we have become so used to, such as the deduction for qualified medical expenses, state and local income taxes and real estate taxes may be eliminated.
However, if the resulting new rules resemble the proposals, there will be a doubling of the standard deduction and the possible elimination of the controversial Alternative Minimum Tax. Below are some tax-planning suggestions, including suggestions related to charitable gifts, which consider both the typical year-end planning techniques as well as planning for a potential overhaul: