The Sky is Falling! The Sky is Falling! Panic or Planning in the Face of Tax Law Changes
There has been a lot of talk lately about the capital gains tax. The possibility that rates will increase. The possibility that the 1031 exchange option will be completely eliminated. The possibility that the step up in basis will be abolished. We have a lot of needs in this country. Social safety nets like Medicare and Social Security are underfunded. Infrastructure that hasn’t been addressed in decades is failing. And none of this even considers the relief monies that have been pumped into the economy over the last year.
I don’t have a prediction about what will or won’t become law. But the reality is that governments can’t long spend money without generating money by way of taxes. We like our roads in good shape. We like our schools to function. We like having police officers and fire fighters. We like having a military to protect us. Etc. Etc. Historically, taxes have gone up and they have gone down. Different and well meaning people with different economic philosophies have tried different things. Yet the world has not come to an end as so many are always so ready to predict and lament.
So what can you do? Obviously we can all vote, and you should. But, the issues are so immense and complicated few really understand at a deep level what the ramifications are for the positions of their preferred candidate or party. What you can do is plan. For every change in the tax laws, the answer has been better planning. As things change we will continue to evolve our planning techniques to provide the best options to our clients. So don’t panic. Just plan.
This post is for informational purposes only and not for the purpose of providing legal advice. You should contact an attorney to obtain advice with respect to any particular issue or problem. Nothing herein creates an attorney-client relationship between Hallock & Hallock and the reader.