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Joe Anderson, CFP\xae and Alan Clopine, CPA discuss a brief history of the tax code and where it might be headed in YMYW podcast episode 87. Find out some possible tax exemptions and deductions under Trump\u2019s presidency; plus, key tax strategies to take advantage of now before the tax code could change. Original publish date December 3, 2016 (hour 1). Note that content may be outdated as rules and regulations have changed.

02:35 \u201cOver the decades, Congress simply amended the tax system by adjusting and assessing new taxes in a series of 17 internal revenue acts.\xa0 By 1939, the series of tax rules became the first formal internal revenue code. 15 years later was the first real tax reform\u2026.tax rates got as high as 91%.\u201d

03:51 \u201cIt was in the Fifties that the alternative minimum tax came into play, and that was really designed for the wealthiest of people.\u201d

05:50 \u201cThere\u2019s Trump\u2019s plan, and then there\u2019s the GOP plan \u2013 there are similarities but [also] some pretty big differences.\u201d

08:02 \u201cTax reform is not a slam dunk, even though we have a Republican president and a Republican majority in the House and Senate.\u201d

09:50 \u201cHere\u2019s a quick nutshell on the ordinary income tax basis; this is what the proposal is. Right now we have seven brackets. They (GOP) wants to break it down to three. We have a 10%, 15%, 25%, 28%, 33%, 35% and 39.6% bracket. They want to combine the 10% and 15% bracket and call it 12%. Then they\u2019ll combine the 25% and 28% tax bracket and call it 25%. Anything over the 25% tax bracket they\u2019re calling it 33%.\u201d

11:19 \u201cUnder Trump, he would like the standard deduction to be $15,000 for an individual and $30,000 for a married couple.\u201d

15:01 \u201cCapital gain rates right now are 0%, 15% and 20% depending on what your income levels are.\u201d

18:07 \u201cIf you are in the 10% or 15% tax bracket today, if you sell that asset there is no tax up to the top of the bracket. Here\u2019s a simple example\u2026\u201d

21:48 \u201cYou have to understand that things might be changing here, for the good or for the worst depending on what your overall situation is. Get an grasp on your overall situation before the end of the year to make sure you can take advantage of anything you should be taking advantage of this year and set yourself up appropriately for whichever changes may or may not happen.\u201d

26:50 \u201cThere are two main proposals on the table right now: the Trump plan and the House GOP plan. They both want to change the way we deduct itemized deductions.\u201d
27:50 \u201cA donor advised fund is kind of like a mini private foundation...\u201d

30:09 \u201cOne of the real benefits of the Roth conversion is for you and potentially your beneficiaries will potentially get all of that money tax-free.\u201d

33:48 \u201cNet unrealized appreciation is another one that\u2019s probably on the chopping block. That\u2019s taking stock out of your retirement account, moving it into a brokerage account to enjoy capital gains tax.\u201d