1. Extension of individual income tax rate cuts
With extended lower rates now made permanent, it's a good time to consider Roth conversions. Paying taxes at today's extended lower rates to convert traditional retirement assets into Roth IRAs can be beneficial.

2. Change in charitable giving itemized deductions
This change makes itemizing charitable giving deductions less beneficial starting in 2026.  This change makes it less beneficial for many to itemize charitable giving deductions. To maximize tax benefits, individuals may consider "bunching" their contributions into the 2025 tax year. 

3. Expanded child tax credit
Families should factor the increased credit into their cash flow and college savings plans. With a larger refundable credit, consider reallocating those funds toward 529 college savings plans or MAGA accounts.

4. Expanded state and local tax deduction cap
The expanded state and local tax deduction cap offers a potential financial advantage for taxpayers in high-tax states or for high net worth individuals in low-tax states.  Consider leveraging the higher SALT deductions for the next five tax years to take advantage of the elevated SALT deductions. Clients who may not have enough to itemize may want to consider bunching strategies to help take advantage of the higher SALT deductions by using donor-advised funds.

5. Additional senior deduction
Maximizing the additional senior deduction can help retirees maintain lower tax brackets, leading to significant tax savings. Retirees should review withdrawal sequencing strategies, such as drawing from Roth or taxable accounts before retirement accounts. 

6. No federal tax on tips
Service industry workers can take advantage of the fact that tips are not federally taxed. This provides an excellent opportunity to bolster financial security through strategic savings. Establishing automatic transfers to Roth IRAs or high-yield savings accounts can build long-term stability.

7. No federal tax on overtime pay
Using the tax benefits available, employees can make smarter decisions about their extra income. A best practice is to use this tax deduction for short- or medium-term financial goals, such as paying down high-interest debt or increasing down payments for major purchases.

8. MAGA accounts
MAGA accounts, designed for children's financial independence, serve as a versatile financial tool. Unlike 529 plans which focus on education savings, MAGA accounts provide parents an alternative way to build financial security for their children without explicit educational constraints. If a client does not want to fund education specifically, the MAGA accounts offer an alternative option.

Contact us for your personalized strategy towards a wealthier future!