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with holistic wealth advisor. Jude Wilson, Hey

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everybody. Welcome to the podcast. This is the Roth guy with the Roth guy himself. Jude Wilson, what’s going on, my friend? How you doing? Hey, I’m excited. I’m ready to roll today again. Ready to Roll. Got you at the office again today. So you’re hanging out there with the with the with the crew, doing your thing there, helping folks out. And your wife kicked you out, didn’t she? That’s what I had to go. Had to get kicked out of the home office. So, yeah, I understand, I understand how it goes. Well. Listen, we want to cover there’s a lot in the BBB, will probably in the coming weeks, talk about different pieces. I just want to focus on a couple pieces today, just kind of how it relates to a lot of our demographic and your demographic and people that you serve. And just dive into a few pieces. If you caught our prior episode, we did a little bit of a breakdown on the tax calculator and how that actually works. And we touched a little bit on the fact that, you know, the BBB, you know, the tax brackets basically, are the same. So we’ll just kind of start there real fast. You just to kind of refresh that. That’s the big takeaway from, you know, from the passing of this legislature is that the marginal tax brackets got extended for the permanent which we kind of covered at least the next three or four years, or until some other form of congressional law is passed. No, you’re 100% right. What we have been telling people for the last couple of years was that the tax cut and Jobs Act was set to expire at the end of 2025,

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and so we made that analogy of, hey, this is like the old Kmart Blue Light Special. If you’re going to, if you’re going to do Roth conversions or move money out, you better take advantage of these, these tax brackets. Now, well, as you know, that was passed under the first Trump administration, and now under the second Trump administration, instead of these tax marginal tax brackets expiring, they have been made permanent. And I say permanent with quotes, because anything that any all tax law is written in pencil, in my opinion, it can be changed by the next administration and Congress. So these rates are as permanent as the people that we have in office are today. That’s a great way of putting it, actually. So that works really well. So you know. So basically, if you are in the 22% tax bracket, for example, and Roth conversions was possibly on your radar, or you’re working with a financial professional now, you’ve got chance to Roth over time, right? There’s some other things, obviously you can do, but we are in those historical tax limits, and that could be a planning opportunity for you guys to think about, right? So that’s kind of a good big piece of that. And kind of just sticking where we’re at and knowing where we’re at, it goes a long way in helping us. They also made the standard deduction more permanent. This has just made things easier most people, I think I saw Jude that nine out of 10 people now just do the standard deduction because it’s so high. It’s just easier than the itemizing exactly when the tax cut and jobs act first came out, everybody was surprised at how high the standard deduction was raised, but when people filed their first tax returns after the Act was passed, they realized that all the deductions that they had did not equate to greater than the standard deduction. So that standard deduction now, as you said, most people are using and it’s a pretty, pretty high amount. That’s also going to be stay into effect as long as you know this administration is here, yeah, and it’s gone up every year. Jude, I think for this year 2025, looking single filers, it’s 15,007

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750 and for married 31,500

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I mean, it’s going to be tough to get the 31,500

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in itemization. Now, if you’re a high net worth individual, you might be doing this right. And there is some other little things to think about there, so that’s a different conversation. But like I said, I want to keep this one kind of tight this week, just on the three main points that I think were the big takeaways. And that was one of them. Now the next one was, and it’s kind of part to this is the senior conversation, right? So obviously, you know, ran on the conversation of no tax on Social Security. Lot of bantering and back and forth. You know, all these different senators have to do their things and their and their floor deals and their back alley and their, you know, office deals on what happens, and what we got was a deduction, or a senior citizen deduction, is what they’re calling it. So let’s talk a little bit about that. It’s a it’s a pretty good number, and it can help a lot of people, but there are some limit there’s some limitations here exactly. So you hit it on the on the head one.

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Was offered during the election was no tax on Social Security, and through all of the negotiation, we got something somewhat of a compromise. So there’s still tax on Social Security, but the way the bill is written now, seniors can get up to $6,000

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tax deduction,

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individual, person per person, yep, 12,000 per couple. And those numbers will be phased out based on how much income. So if you’re making under 150,000

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as a senior who’s taking Social Security, then you’ll qualify for the full $6,000

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above $150,000

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married filing jointly, you start to get phased out. That number drops, and then it’s fully phased out for couples making $250,000

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joint income, married filing, filing jointly. Yeah. Interesting. Jude, because, you know, obviously everything’s got a political slant in everything we do anymore. No conversation seems to be had about anything without some sort of political bias and a lot of conversation around and I’m not trying to get into that, but just simply stating that you hear a lot that it was all for billionaires, and there’s definitely pieces of this stuff that helps the high net worth people, but these first few pieces actually do help lower and middle income families. Well, to the point about 88% of people on social security will probably pay little to no taxes. That’s a help. That’s a help, right? That’s a big help. But it is important to note that you know, depending on what you make, this may not benefit you at all. Right? So that’s where it’s really important to kind of talk about and talk with your financial professional and your CPA about how this may or may not affect you. It also has another phase out. Jude This one’s only in place until 2028 Exactly, exactly, you know, we had already started a conversation that, you know, tax code is written in pencil, and it’s only good for the time being that the politicians who wrote The codes are in office. But this one specifically says it’s good through now through 2028 Yeah, for sure. So what’s your takeaway on some of those first just those first few pieces as a planner, right? Not as a, you know, as a political stance or anything like that, just as a planner. How do you think that this works out for you and clients that are getting close to retirement? Oh, it gives us so many more options, like in Social Security alone, without even talking about this, there are multiple combinations between a husband and spouse, to claiming strategies that would allow you to actually elevate the income over your lifetime. And most people don’t even know about that, they say, Oh, I’m going to claim at 62 or I’m going to claim at my full retirement age, or age 70. So where we see a lot of benefit to this and to seeking the advice of a financial professional is that we get to worry about the x’s and o’s and come up with a good game plan so that the retirees don’t have to worry about the X’s and O’s. They can, they can now start to work on the oohs and oz of their life. Ooh, I’ve I went on this great vacation because I have additional income that you know through these, through these planning strategies were made possible, yeah, for sure. So just you know, again, to kind of recap, we’re just going to keep it short and sweet this week. Just wanted to touch on those three big pieces. So obviously, those are some, you know, some impactful parts for a lot of people, especially the deduction for seniors. There was other stuff like no tax on tips for up to 25,000 that might not affect our listening base and our client base there, but could their kids or grandkids. So, you know, there are some different pieces there. The EV credits going away. If you were considering getting an electric car, you might want to do that before September, because I think that goes away in September. There’s an interesting one about $10,000 you can write off, or you can work. It’s an above the line item for interest on a car payment. So if you are getting a new car, that’s got to be final assembly in America, though, I I’m curious to see what the breakdown on the percentage of final assembly means, right?

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Yeah, is 60% of the car need to be assembled here, 70. What is it? You know? So a lot of little things. So again, check with your CPA, check with your financial professional. Obviously, we can’t break down every single one in a short episode here, but we wanted to touch on those three big ones because they do affect a lot of folks out there. Jude, thanks for hanging out and breaking it down. We’ll probably go into more detail in the coming weeks on individual pieces. I really do kind of want to talk a little bit about these new accounts, these these child accounts. I’m not going to say what they were called, because YouTube doesn’t like that, but it is. It could be a really cool thing for a lot of young people and families as they’re, you know, building, trying to build wealth for their for their future kids, right? So are their kids and as they grow. So we’ll talk more about that in the coming weeks. Don’t forget to subscribe to us on App.

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Or Spotify, or YouTube, whatever channel you like, hit the subscribe button, thumbs up, and ring that notification bell and go to the tax bomb.com and check out the calculator. It’s just a simple process. We showed how to do it on a prior episode. Put in your information, see what your tax rates might look like, and then see if maybe Roth conversions are right for you. It’s a great start to say, Yeah, I want to talk more about this, then you can reach out, schedule some time with Jude and his team and run through that for yourself. So thanks for hanging out, Jude, thanks for breaking it down. Brother. Hey, never a dull moment in Washington and never a dull moment on our podcast. Absolutely. I appreciate it. Everybody appreciate your time. Thanks for hanging out with us here on the Roth guy, we’ll see you later.

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