2020 Year-End Planning: Identifying Tax and Financial Planning Opportunities
My name is Joe Velkos, and I am a director of trust tax with Key Private Bank. And this is the Key Private Bank Wealth Management Podcast. Today's podcast focuses on identifying critical tax and financial strategies to consider as part of your 2020 year-end planning efforts. Our objective is for each of you to walk away with at least one key takeaway to help meet your overall financial goals as we move into 2021. In years past, Key Private Bank has published written material with year-end planning suggestions. However, with 2020 being a unique year in many ways, we thought a quick hitting discussion in addition to our written material would simplify many of these concepts and provide additional actionable steps for you to get started. We're thrilled to have Tina Myers here with us today to help us make sense of this big topic. Tina's a senior financial planner with our private bank team, where she provides our clients with financial planning advice and comprehensive set of strategies to grow and preserve their wealth. Welcome Tina. Thank you so much for joining me today.
Thanks for having me, Joe. I'm looking forward to this.
It's important to note that this podcast is being recorded on October 23rd, nearly two weeks before the presidential election. There is obviously a lot of buzz surrounding the election and ultimately its outcome. From a planning perspective, although President Trump has indicated no change to his tax policies going forward if reelected. Vice President Biden has indicated the opposite and will go in a different direction. In either case, we anticipate no direct impact for planning for 2020. It's also important to note for tax loss to be enacted much work is required of Congress. So there are certainly no guarantees for a policy to become law. And finally, keep in mind as well text law changes will likely be going forward and not retroactive. As a result, our approach here is to focus on current law but also to keep an eye on what the future may hold. Tina, you had some thoughts here you wanted to share.
Yeah, sure, Joe. You're right. Election years always have this added element to year-end planning. So, and I think one of the most important things to remember is that any of these potential changes that are being proposed really apply to what are called like the wealthiest taxpayers. And that is deemed to be above $400,000 or basically the top 1% of taxpayers. So we do have a lot of those clients that are gonna be affected by these potential changes, but we also have a lot of retired clients, too, that are below that level and they may not be impacted as much. But I think they're still concerned about what that means for them. So I think everyone's situation is different, and it's easy to see why everybody is so anxious about what's gonna happen in the future and if they're gonna need to pivot their planning if they need to.
Yeah, again, this is just, like you mentioned, this is just the first step. Where it's a long way before anything gets changed here. So it is important to focus on what the law is currently but also just to keep an eye out for the future as well. So we're gonna break this podcast into three sections. The first section is planning for individuals. Then we're gonna discuss estate and wealth transfer planning, and we'll close out with a section dedicated to our business owners. The most basic year-end planning technique that can be undertaken to minimize taxes for individuals it's what's known as tax loss harvesting. Harvesting involves selling the investment that has lost value to offset realized capital gains. Before harvesting a loss there are some key items to consider. First, understand which capital gain rates apply. For example, if you have, if you're in a net short term gain capital gain position, that gain would be subject to ordinary income. If it's held long-term, ie. for more than a year, then the favorable rates kick in. Rates range from 0% to 20%. The 20% long-term capital gain rate kicks in for the wealthier taxpayers, those who are married and make greater than $497,000. A couple of general rules here. The first one is you should only harvest the loss if the tax benefit outweighs the investment cost. In other words, the tax considerations should not be the primary driver in making investment decisions. Tina, I think the old adage, "Don't let the tax tail wag the dog," certainly applies here.
Yeah, it certainly applies in the financial planning world, but there's also a couple of other things that I wanna mention really quickly, too, regards to the tax loss harvesting. One of those is also don't forget about that net investment surtax that came into play a couple of years ago. That's the additional 3.8% surtax. I've seen an example where a client can wipe out their capital gain because they've got like itemized deductions or something like that to offset it, but they still have that net investment income tax apply on top of that, so sometimes they kind of forget about that. And then also, with regards to the presidential election, Joe, you wrote an article on this recently. It was a side-by-side comparison of the two candidates. And one of the things you had mentioned is right now we've got those favorable tax rates, the highest rate being 20% for long-term capital gains and qualified dividends. But the proposal is that that could increase to ordinary income tax rates, which is the 39.6%, for those greater than $1 million. And then added on top of that, if our basis step up at death goes away, I think that's also gonna impact some of the decisions, those investment decisions, that clients make. Like they may think about maybe selling a capital asset now and repurchasing something else to kind of reset that basis so that a future sale maybe won't be taxed at high, potentially higher rates. This, I think, could also cause some investors to shift a little bit in their investment strategy. Before, I know they were looking a lot at dividend paying stocks because those were being texted more favorable rates. And now, maybe there may be more of a consideration towards tax exempt bonds. And I guess in that case, the only thing I would mention is just to make sure that you're still achieving your overall desired portfolio rate of return that's gonna help you achieve your goals no matter what your asset allocation ends up being. So just a couple of thoughts on that.
Those are some excellent thoughts for folks to consider. If we mention tax loss harvesting, we obviously have to mention the wash sale rules. As with many loss strategies, the IRS has rules that exist to limit their effectiveness. So the wash sale rules prevent taxpayers from selling or trading a security at a loss and then buying the same stock or a substantially identical one within 30 days before or after the sale, the so-called 61 day rule. So a simple example, Tina, to that would be if I sell a stock today at a loss, I cannot, well, if I do repurchase it tomorrow, that loss would be non-deductible. It would actually be deferred. So the loss itself wouldn't be a loss. It would just be deferred until I ultimately sell that security. That's kind of a simple example of what the wash sale rules are. And then, of course, with any obstacle opportunities exist. One possible solution here, and again, you should always consult your portfolio strategist, is you might wanna replace that stock you just sold at a loss. And then you can buy a mutual fund that targets the same industry.
Yeah. Hey Joe, I don't think a whole lot of clients are really that aware of this because a lot of their money managers are doing those buy/sell decisions for them, but they do actually end up seeing that when they get their year-end tax reporting statements where some of those losses may be disallowed on that statement, right?
Yeah, no, that's correct. And accountants, CPAs really should be coordinating with their clients' advisors, their investment advisors, as we're approaching year end to make sure that they're considering all facets including the tax consequences of any transaction. As we move away from capital gain planning, let's talk about charitable planning here. As we all know at this point, the Coronavirus Aid Relief and Economic Security Act, or the CARES Act, provided many benefits to aid families and businesses impacted by the coronavirus pandemic. The CARES Act actually provided a significant planning opportunity by modifying and lessening the limitations for certain cash contributions. The key takeaways here, a qualified contribution that is a cash contribution made to a public charity like the Salvation Army, that limit actually increases from 60% to a 100% for 2020. So a simple example here is let's say a taxpayer had adjusted gross income of about $500,000. He or she can contribute $500,000 as long as they're considered qualified contributions and they'll essentially wipe out their federal tax liability. Again, that's a significant planning opportunity for many clients who are charitably inclined. There is one pretty significant exception to this new rule, donor-advised funds. So any contributions, any cash contributions, made to donor-advised funds, which again, is a very powerful planning vehicle with many of our clients, it won't qualify for this 100% limitation, but it would qualify for the 60% limitation. So again, same example. If we have a client who had an AGI of $500,000, but decided to make a contribution to the donor-advised fund, their limit would be 60% or in this case would be $300,000. So you could see the difference between the two plannings. And we get a lot of questions from clients, "Why did they leave the donor-advised funds out of this qualified contribution definition?" Candidly, the idea of increasing this contribution limit was to get more money to intended recipients sooner than later, as in, in 2020. When it comes to contributions of donor-advised funds, donor-advised funds do not have a current year contribution requirement. So that money would not get to the intended recipients. Tina, I know you spend a lot of time with your clients in this charitable space. What are you seeing when talking to them?
Yeah, so it's interesting because generally in the past, the advice that we've been giving clients is if you've got something like appreciated stock, donating it directly to a charity is probably the best idea because you won't recognize the capital gain ever on that stock. The charity's tax exempt. So it's not gonna recognize any capital gain that. But for 2020, I think it's a little bit different. And in some situations you may actually consider selling your stock first and then contributing that cash because you get that higher AGI limit that you spoke about, the 100% AGI. So I would just caution to make sure that clients are running an analysis and reviewing that with their tax advisors to see which strategy would be better for them this year. And again, also, I see a lot of clients taking advantage of those qualified charitable distributions, QCDs. That's also a really good tool that can be used. That is where they can donate a $100,000 from their IRA directly to a charity. Again, that is only for if you're 70 and a half or older. And the reason why that one is really useful is because you don't have to include that distribution in your adjusted gross income. And that has an effect on items such as the taxability of Social Security, or some clients have that additional Medicare premium adjustment for high income earners because of higher AGI and things like that. So, and then, Joe, I think you also talked, you touched a little bit on the donor-advised funds and the implications on the CARES Act on that this year. But I know over the last couple of years, we've seen a lot of clients very interested in doing gifts to donor-advised funds, mostly because of the recent change where there are less taxpayers itemizing because the standard deduction is so much higher. So to take advantage of that, clients are wanting to bunch their charitable deductions. So utilizing a donor-advised fund is kind of a great way for them to be able to do that, make that larger gift this year and then have the donor-advised fund make those distributions to charity out in future years. But again, like you said, just remember those donor-advice contributions this year are limited to the 60%, not the 100% of AGI. It's still a good idea though.
Yeah, no, those are all certainly good points to consider. You had mentioned qualified charitable deductions. Obviously, that will help us pivot into our next section, which is individual retirement accounts. The CARES Act also made some temporary changes related to the rules for IRAs. And Tina, you know this as a planner, Roth conversions have always been very popular this time of year every year, but this year it seems to be even more of a popular choice. Why is that?
Yeah, Joe, so the CARES Act actually waived the 2020 RMD requirement. So many more clients are considering the Roth conversion this year, so with that potential for future higher taxes, they'd rather pay the tax on the conversion amount now at those lower rates. And that might seem like a good idea. It's different for every client. And just to revisit, some of those benefits of the Roth IRA include reduced future RMDs on the traditional IRA in the future. For a Roth IRA, there are no RMDs for the original owner. And then at the account owner's death, you can pass a tax-free asset over to your heirs. So for those individuals that are considering, that did waive their RMD this year and consider converting that amount to a Roth conversion. This is a one-time opportunity though because RMDs in a normal year cannot be converted. So take advantage of that this year. I have a lot of clients asking about that. And as we get closer to the year end, it's a lot easier to determine what your 2020 marginal tax bracket may be. And maybe also have an idea of what your projected investment income is. So you can really do a better and a more precise tax projection now. Another thing I would also remind people of, Joe, is once you do a conversion now, a Roth conversion, you can't undo that transaction anymore. I know you used to be able to recharacterize it for a period of time, but that rule changed after the Tax Cuts and Jobs Act, right?
Yeah, no, those are all obviously really good points. But yeah, you are correct. We're focusing on 2020 with the CARES Act, but a short time ago, was it December of what, 2017, the Tax Cuts and Jobs Act that you just mentioned really made some fundamental changes to traditional tax planning, taxability of items. So it is important to keep understanding that those things have to be taken into consideration as well. Okay. Now we're gonna, along the lines of retirement plans, another way we can maximize. We can reduce taxable income is by maximizing contributions to retirement accounts. On a practical matter, Tina, I think these are basics. These are something that everyone should be doing. And again, we're not gonna spend too much time on this. What we're referring to are contributions to 401 plans or 403 plans. Now these are the plans that are sponsored by your employer. The maximum regular contribution for 2020 is $19,500. And there's also a catch-up contribution for those age 50 and older of up to $6,500. And again, some key reminders with regards to these contributions, these contributions are typically pre-taxed. So you're obviously reducing taxable income. The plan assets grow tax deferred, and obviously the other benefit is your employer may match some or all of your contributions. If I could use a baseball analogy, Tina, with the World Series going on currently. You don't always have to hit home runs, singles and doubles add up to significant savings over the years. Would you agree?
Yeah, I totally agree with you there. And I would advise clients that to make sure that they do check their current year-to-date contributions. And if they haven't, if they're not maxing it out yet, or at least making sure that they max it up to, like you said, the employer matching percentage, you still have time to make some adjustments to your last couple of paychecks this year. So, and I know we're gonna talk about this a little bit later when we're talking about business owners, but this too is also a great way for them to reduce that taxable income, especially if they are going to take advantage of using that qualified business income deduction we'll reference later on.
All good points. And we'll certainly talk about that in a bit. But it's funny because filing season just ended on October 15th, right? That's the deadline for the extended return, for extending returns for individual returns. And then we roll into year-end planning, but this is really a good time that we can start making sure everything that can be done will be done before the end of the year. And your suggestion of looking at your contributions year-to-date and consider making any changes is obviously a very solid suggestion there. In addition to retirement plans, other tax saving vehicles are available to help not only to reduce taxable income, but simply they're solid planning opportunities that every individual should take advantage of. Health saving accounts, or HSAs, are becoming an increasingly popular tool for many to pay for qualified medical expenses. Again, takeaways here include tax deductible contributions, if you're single of $3,550, or a family is up to 7,100 for 2020. This money earns tax-free interest and the withdrawals are not taxed if they're used for qualified expenses. These HSAs are very flexible, meaning you can open up an account in December and fully fund it to the maximum contribution. You don't have to start in January to open this account. You can do it in December. And again, they're flexible in a way that even if you change your health plan or change your employer, this account goes with you. It doesn't stay. So it'll be with you forever. Tina, I know you're a fan of these HSAs as well.
Yeah, Joe, I'm a big believer in the value of an HSA account and especially in terms of using it for future health care costs in retirement. Especially because, I would set up an HSA and I would actually use my current earnings to pay for my current health care expenses and then let that HSA account grow and use that for my future retirement healthcare expenses. Did you actually know though that healthcare is one of America's top financial concerns? So I think that using an HSA to help with that tax free growth can provide a lot of peace of mind for some of those clients during their retirement years.
Yeah, that was certainly a big discussion, a big topic of discussion, yesterday with the third presidential debate about healthcare and what the healthcare system is gonna look like going forward. In addition to HSAs, if someone's interested in saving for education expenses, they should consider contributions to a 529 plan. Again, with these plans, although you don't get a federal deduction, many states do allow a state deduction against their income. And again, when these monies are pulled out, when those qualified distributions are made, they're generally tax-free to both federal and most states. And the Tax Cuts and Jobs Act certainly expanded the use of these funds or these distributions. Before, they were only exclusive for post-secondary qualified expenses, but now they do qualify to pay for elementary and secondary tuition as well. And again, these are ideal for grandparents or other family members who wanna contribute to a relative's education. As we switch over into our wealth transfer and estate planning, but before we jump into some specifics, Tina, I know we're firm believers as a firm that an analysis should be performed to determine why they're gifting, or any sort of wealth transfer planning should be undertaken, you have to make sure that there's enough assets left for a lifetime for the donor or donors. You really need to take care of the individual who's looking to do the wealth transfer really needs to understand what they need for the rest of their lives before they can start transferring some of their wealth. I know you're gonna touch on this in a bit, but before we turn it over to you, I do wanna talk about kind of a very basic estate or wealth transfer planning opportunity. That's called the annual gift. As most of us know, generally any gift that's made is subject to federal gift tax rules. However, certain exceptions exist. And the one that does exist is the annual gift exclusion. Simply, the annual gift exclusion allows each person the opportunity to give away an amount, the amount is 15,000 for tax year 2020 per person, that is not subject to any of the gift tax rules. Key takeaways here includes this is very easy to administer. If the only thing you're doing is gifting cash under the $15,000 limit, no gift tax return is required. Okay? I know some advisors do not think that this is a powerful tool. I think the opposite. If you undertake this annual gifting to individuals, not just family members, friends, and you do it regularly over an extended period of time, those savings will certainly add up and will reduce your overall estate. And one key exception within this exception is if there's payments made to institutions, let's say for tuition or for medical payments, and they're made directly to the institutions, that will not count against the exclusion for the recipient. So again, another opportunity to ultimately save on the estate taxes. Again, Tina, I know you spent quite a bit of your time dealing with clients talking about their estate plans. You mind sharing some of the thoughts here that you do share with them as well?
Yeah, sure. I do like the idea of the annual gift exclusion too, as well. I see a lot of clients doing that. And to reiterate your point, I mean, simplicity is the key there. So I like that idea. But yeah, no, so as you were saying with regards to the estate planning, and you started off with this, is just to make sure, the first thing is to make sure that your own financial security is in place before you start gifting away to charities or children or things like that. But if you're projected to have a taxable estate, whatever that exemption may be in the future, the environment today, I think, is really ripe for transfer planning in particular. And I'm gonna talk a little bit about the low interest rate environment and then the exemption. So I know we have a couple of good articles out on key.com, related to taking advantage of the low interest rate environment for transfer purposes. So a couple of really good strategies that work really well in this environment are, it's kinda like alphabet soup, but grantor retained annuity trust, GRATs, and charitable lead annuity trust, or CLATs, those work really well. And then also, the ability to maybe refinance some of those intrafamily notes that have very low interest rates right now. But I do think the reason why some of these techniques work really well in today's environment is because the rate, when you make a transfer, the gift portion of it uses a particular rate, interest rate, that's set by the IRS. And that rate is pretty low today. So as long as the assets that you are transferring grow at a rate that is higher than that IRS interest rate at the time of the original gift, then all that excess growth transfers over to those inheritors, I guess, tax free. And so there's very little use of gift tax in some cases. So I think it's just a really good way to go ahead and take advantage of that today. And then also, with regards to this federal estate exemption, so good God, I can remember when the exemption was, the federal exemption was at $675,000. And now it's at like 11.58 million per person right now. And that is a huge, that's a huge amount, right, Joe? But there is a chance that it could go down, and we don't exactly know what that's gonna end up. It could be three and a half million. It could be five million. We just really don't know what that's gonna look like. But if you remember back at the end of 2012, we kinda had the same thing where we thought that maybe there was, that the exemption rate could go down. And so there was this big rush of planning at the end of the year. And then one of the biggest questions that came up was if somebody did make a big gift at a time when the exemption was higher and then later on they died at a time when the exemption was lower, was there any chance that that gift could be kind of clawed back into their estate? And a lot of the articles and a lot of the advisors out there have said that there is no chance of a clawback. So that gives them some comfort to clients thinking about making those transfers. And then another thing, Joe, also with this environment to those that are considering, and we'll probably touch on this a little bit when we're talking about our business owners too, but using those valuation discounts that are available for transfer planning purposes. And I know that that's also been a subject of contention where some, those valuation discounts could be going away sometime in the future. I know that's been the subject of some bills that have been proposed, but nothing's really gone through with that.
Yeah. All good points. Just a couple of commentary from me, Tina, is talking about clawbacks. There is, with any tax law change, there is a slight possibility or slight chance to make it retroactive. But the reality is if you look at the history of tax law changes, they've all been prospective, going forward versus retroactive. So I think that's good to keep in mind. Again, there's no guarantee with the future, but that's what history was. And then you mentioned in 2012 when there was a mad rush to do some estate planning at the end of the year. I know folks are kind of in the same mindset this time around in case there's a change in the white house. What would you recommend to clients regarding that potential change and what they should be doing at this point before the end of the year?
I would definitely recommend to reach out to your team of advisors, including your attorneys. 'Cause I've heard that attorneys are very busy right now. They're working with their existing current clients. Some of them are not taking new clients right now. But if you don't reach out to those advisors before December, your chances of being able to put something in place very quickly at the very end of the year are probably pretty slim. I've also heard a lot of people that are putting something in place that is flexible, where they don't actually have to pull the trigger quite yet. And they can wait until after the election, which is only, right now, two weeks away, or even wait until they get into 2021 to really make those decisions.
I guess it's never too early to get started. Right?
And again, and the third part of our podcast, we're gonna spend a few minutes discussing business planning for our self-employed clients. Tax planning, Tina, is probably the last thing most business owners, that's on business owners' mind as they deal with the financial and operational challenges of the coronavirus crisis. However, the reality is businesses cannot afford to neglect tax planning for this year. Key items to consider if you're a business owner, it starts with income and expense management, kind of the ABC's, the blocking and tackling of planning. Again, simply, if your business is on a cash method of accounting, consider deferring billing until the new year. If your business is on the accrual method of accounting, you can delay shipping products or delivering services if possible. On the expense side, accelerate payment of expenses before the close of the year. If you're gonna make expenses, you're looking to pay them in January or February, again, try to accelerate those, so you can realize a current year benefit. And then we touched on contributing to retirement plans for individuals. There are similar retirement plans for business owners, self-employed retirement plans or SEPs. Their maximum contribution is $57,000. Now that's based on net earnings, but clearly it's an opportunity to not only save for the future but also reduce the tax bill currently. Tina, I know you had some thoughts you wanted to share on pass-through entities here.
Just a reminder though, yeah, if you're a pass-through entity, meaning like a sole proprietorship, an LLC member or a partner in a partnership, that those things pass through to you. That affects your individual income taxes. So just don't forget about those things.
Yeah, in addition, Tina, you mentioned members or partners in a partnership also as corporations are shareholders and as corporations are considered a pass-through entities as well. In addition to regular depreciation, switching from we talked about expense management, let's talk a little bit about depreciation here. In addition to regular tax depreciation that's taken on assets. There really are two significant additional expensing depreciation provisions that are available to business owners. The first one is known as Section 179 expense election. Essentially, what that does, it allows for an owner to write off 100% first year deduction for the adjusted basis of the assets. Okay. So again, there's some rules regarding what a qualified property is, but for qualified property that's placed in services, as placed in service in 2020, a business can expense up to $1,040,000 of Section 179 expense. You had mentioned some exemption amounts from previous years along those lines, Tina. In tax year 2000, I think we were both practicing at that point. The Section 179 expense limit was only $20,000. So we're looking at it in over 20 years, that thing increased over a million dollars. That is obviously a significant opportunity. And as mentioned, there's most, there are certain qualifications that properties must meet to qualify. It's either new or used assets. And again, there are some limitations and the one limitation that's really, you gotta keep note of, is the expense limitation. In other words, the limitation of $1,040,000 is reduced dollar for dollar when the assets purchased for the year exceed nearly $2.6 million. Again, that's a very high ceiling and a lot of our business owners will not get near that. But I did wanna point out that that is out there. And probably actually the biggest limitation when it comes to Section 179 is it's limited to taxable income. So it will, the expense will allow the owner of, or the income from the entity to get to zero. It will not throw you in a loss situation. There is, however, a another depreciation opportunity called bonus depreciation where the taxable, there is no limit with regards to the taxable income. In this case and similar to Section 179, depreciation allows, for most depreciation allows for 100% immediate expensing of assets purchased and placed into service. A lot of similarities, but there are some differences. Differences include, this is only for qualified property that has a recovery period of 20 years or less. And again, as mentioned, there is no limitation to taxable income as there is for Section 179. Now these depreciation rules, although not complicated, may be confusing. So please be sure to work with your CPA or tax advisor to maximize these benefits. And as we head into the home stretch here, Tina, the last thing we wanna talk about is a QBI. You had mentioned the QBI earlier in the presentation. As a business owner, another opportunity to reduce taxable income is to manage your entity's taxable income and maximize the deduction for the pass-through businesses that was introduced as part of the sweeping corporate changes to the Tax Cuts and Jobs Act back in 2017 and 2018. Simply and generally, the deduction equals 20% of your qualified business income or what we call it as a QBI. Again, we won't get into a lot. There's a lot of details or a lot of specifics, but some key considerations here is this limitation, this deduction is based on the type of business you are. In terms of the QBI, it's known either as a qualified or non-qualified business. An example of a non-qualified business is also what's known as a specified service trader business, ie. most professional practices. There are some limitations based on individual taxable income, and there's even further limitations if one exceeds these taxable income limits, and you have to look at wages as well as qualified property that the business has. So at the end, again, there's quite a bit involved with QBI but the key is to really manage your taxable income from your business through income and expense management and to take advantage of these deductions. Because Tina, this deduction is upwards of 20%. That's a pretty significant deduction there.
Yeah. I don't think people really realize the significance of a 20% deduction. You're right. That's huge. And especially because these are from pass-through entities like sole proprietorships, LLCs, partners, and things like that. And they may not know what the income is that's passing through to them, but then again, just to make sure what they can manage is their own taxable income limit. They can reduce that so that they are able to benefit from that 20% deduction. So definitely stay below that income limit, make those contributions to those retirement plans, maybe pay those employee bonuses or things like that. Right?
Again, plenty of time before the end of the year to take advantage of all these deductions. Tina, I believe that wraps up the topics we wanted to address today, but before we sign off, is there any final key thoughts you'd like to share?
Yeah, sure. So I know we just had the last presidential debate last night, and all the election results are weighing heavily on everyone's minds, but I wanna caution people to what degree should you let the political outcomes affect your financial decisions. And my best advice, I guess, would be to remain nimble and cautious. So always plan for the unexpected, especially the things that, you know, you can plan for what you can control, and what you can't control, you just kinda have to go with it. I would use some of our time-tested year-end planning strategies and just kind of stick with that. Hope that our listeners or viewers found some of that dialogue helpful.
All solid advice. And again, there's plenty of time before year end comes. So there's plenty of time to do some planning as well. Well, that's all the time that we have for today's podcast. Thank you again to Tina Myers for a fantastic discussion. As a reminder, Key Private Bank has produced a Comprehensive 2020 Tax Planning Guide for individuals and businesses that takes a deeper dive into many of these strategies. You can read and access these materials in the description below or by visiting key.com/kpb and clicking on our insights section. If you're a current client, have additional questions, or if you'd like an in-depth explanation of any of these strategies discussed, please contact your Key Private Bank advisor. If you are new to Key Private Bank and would like more information about our approach to wealth management, we encourage you to visit key.com/getthere to contact one of our experts. Thank you again for listening. We hope you'll join us for the next Key Private Bank Wealth Management Podcast.
In this special podcast, Joe Velkos, Tax Trust Director with Key Private Bank, sits down with Senior Financial Planner Tina Myers to discuss 2020 end of year tax and financial planning.
Joe and Tina boil down the complex topic of tax planning into several critical takeaways that will provide flexibility regardless of the potential election outcome or the impact felt by COVID-19.
- Possible influences from the election outcome (time code 01:20)
- Individual tax planning including tax-loss harvesting, wash sale rules, charitable planning, and required minimum distribution rules (time code 3:37)
- A review of estate and wealth transfer best practices with advice geared toward annual gifting strategies, vehicles to take advantage of the lower interest rate environment, and current exemptions (time code 22:37)
- Mapping out a business tax plan, focused primarily on recommendations to maximize expenses and leveraging QBI deductions (time code 31:07)
- Tina and Joe's final thoughts and recommendations for next steps (time code 38:40)