Hinckley Cook CPAs has announced that it can help clients to manage their finances through personal finance planning, business services and tax services. This comes after news of major changes to Kiddie Tax, a provision which taxes unearned income of kids under 19 and full-time students younger than 24. It will impact tax and investment planning.
More information can be found at: https://hinckleycookcpa.com/arlington.php
The new changes will impact tax planning, investment planning, IRA planning, and college funding for the next eight years. This means that kids could end up in a higher tax bracket than their parents.
In 2026, the individual changes in the Trump law will expire and the law will revert back to the law as it is written in 2018.
The new changes are landing because of the recent Tax Cuts and Jobs Act, which made significant changes to the Kiddie Tax beginning in 2018. The Kiddie Tax applies to children under 19 years old, dependent full time students between 19 and 23, and does not exclude children who are married and filing a joint tax return.
The tax applies to unearned income and child receives, gifts, inheritances, cash, stocks, bonds, mutual funds, and real estate. However, salary earned by the child is not subject to the tax.
Now, children are no longer impacted by their parents tax rate, and parents dont have to worry about adding the earnings of multiple siblings together. However, the new rates could end up being higher than the parents highest tax rate.
With the new changes, a married couple would have to have an income of over $600,000 to match the highest rate in Kiddie Tax.
Managing finances and taxes can be a highly stressful situation, but Hinckley Cook CPA is always there to help. It is a full service Certified Public Accounting Firm and can provide guidance to help clients through all aspects of their finance management and tax preparation.
Full details of the services can be found on the URL above.
For more information, visit: https://hinckleycookcpa.com/arlington.php