2024 Tax Update – Keiter Knowledge Sharing

Key tax considerations for businesses and executives in 2024

Keiter’s 2024 tax seminar provided valuable insights into upcoming tax changes, the Corporate Transparency Act, and practical tax planning strategies. Below are the highlights from the tax update session presented by Jen Flinchum, CPA, CFP®, and Vince Nadder, CPA.

Corporate Transparency Act

The Corporate Transparency Act (CTA), effective from January 2024, aims to combat money laundering by requiring entities to report beneficial ownership information (BOI). Key points include:

• Reporting requirements: Certain domestic and foreign entities must file information about beneficial owners with the Financial Crimes Enforcement Network (FinCEN), including individuals’ name, date of birth, address, a unique identifying number from an acceptable identification document, and the name of the issuing jurisdiction of that identification document.
• Exempt entities: Certain entities, such as financial institutions, government authorities, public accounting firms, and other highly regulated industries are exempt from these reporting requirements.
• Penalties for noncompliance: Substantial penalties, up to $10,000, may be imposed for noncompliance.

The CTA’s implementation poses challenges, particularly for small businesses, and emphasizes the need for accurate and timely reporting.

Sunset of the Tax Cuts and Jobs Act

The Tax Cuts and Jobs Act (TCJA) provisions are set to expire on December 31, 2025, bringing several changes:

• Individual tax rates: The top rate will revert to 39.6%, and the Qualified Business Income (QBI) deduction will be eliminated.
• Standard deduction: The standard deduction will be reduced by approximately 50%.
• Estate and gift tax: The lifetime gift and estate tax exemption allows for tax-free transfer of wealth from one generation to the next. With the passage of the Tax Cuts and Jobs Act (TCJA), the gift and estate tax exemption increased significantly. The $13.61 million lifetime gift exception is temporary and only applies to tax years up to 2025. Unless Congress makes these changes permanent, after 2025 the exemption will revert to the $5.49 million exemption (adjusted for inflation).

These changes underscore the importance of proactive tax planning to mitigate potential impacts.

Tax planning strategies for families, executives, and entrepreneurs

The seminar provided practical tax planning strategies for families and high net worth individuals:

• Maximize employer benefits: Utilize qualified retirement plans, flexible spending accounts (FSAs), and health savings accounts (HSAs) to defer income and save on taxes.
• Investment accounts: Review your investment portfolio to optimize tax efficiency, capturing losses and managing capital gains.
• IRA funding and conversions: Consider contributing to traditional or Roth IRAs and explore conversion opportunities, especially before the TCJA rates expire.

Business tax planning strategies

For businesses, Jen and Vince emphasized the importance of strategic planning:

• Expensing of assets: Take advantage of bonus depreciation and Section 179 deductions while they are still available.
• Research and development (R&D) expenses: Be aware of the new capitalization requirements for R&D expenses and plan accordingly.
• Interest expense limitation: Monitor the Section 163(j) limitation on interest expense deductions, especially as interest rates rise.

Keiter’s 2024 Fall Seminar provided a comprehensive overview of the upcoming tax changes and practical strategies to navigate the evolving tax landscape. Staying informed and proactive in your tax planning can help you make the most of the opportunities. Our experienced tax advisors are available to help your business navigate tax planning and compliance needs. Contact your Keiter Opportunity Advisor today.

Additional Resources: 

• Tax Planning Insights: 2025 Individual Tax Inflation Adjustments

• SSA 2025 Cost of Living Adjustments: What Employers Need to Know