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World Turned Upside Down

On Tuesday, Georgia Democrats drew two inside straights and won their Georgia Senate races. The victories turn Georgia blue for the first time in generations. More important, they turn the Senate blue, by the thinnest possible margin. That shift, along with Team Blue’s continuing (albeit diminished) majority in the House of Representatives, means that incoming President Joe Biden has an actual shot at passing his tax proposal.

This presents a seismic opportunity for you and your business – if you choose to take advantage of it. (Sadly, most tax professionals won’t. But that’s why you’re here, right?)

Taxes are going up. It’s not just a possibility anymore. It’s a near-certainty. Your best clients and prospects are already starting to feel the pain.

Now, you can be like most tax pros. Learn the new rules and keep your same-old numbers-in-boxes business up to date. Take a couple of “new tax law” CE seminars, and tell your high-income clients they just have to pay the new higher taxes.

In short – if you’re just like everyone else now, you can keep being just like everyone else. Or you can be different and better.

Clients won’t just want to know how much they’ll owe under the new law. They want to know how to pay less. Burn that into your brain.

Most of your peers won’t be giving their clients what they really want. Burn that into your brain.

Imagine offering your clients something different. Something better. Imagine telling your clients how they can “opt-out of higher taxes.” Do you think that might grab their attention and establish your superior value. (Spoiler alert: it will.)

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Biden’s Tax Changes

Here are some of the changes the Biden campaign has proposed. Your best clients aren’t going to be happy with them:

• Raise the top marginal rate back up to 39.6%

• Raise rates on capital gains to that same 39.6% for taxpayers with AGIs over $1 million

• Add back the 12.4% OASDI tax for earned income over $400,000

• Reimpose the “Pease limits” to phase out itemized deductions.

• Limit the value of itemized deductions to 28%.

• Scale back qualified business income deductions

• Raise the corporate rate back up to 28%

Those are going to make tax planning even more important. Will your clients still have the right business entities? Are their charitable plans still as tax-efficient as possible? Do their qualified plans still make sense? These are the sort of questions they’ll want answered. Telling them to scrounge a little harder for some more lunch receipts just won’t cut it.

Obviously we have to wait and see what actually passes in Washington before diving too deep into specifics. But our big theme for 2021 will be crafting a marketing campaign for you to take to prospects and clients built around opting out of the coming tax hikes. This will include a “big picture” primary campaign, along with multiple targeted campaigns focusing on specific opportunities for specific markets. As always, the ultimate goal will be to transform your business from old-school numbers-in-boxes to robot-proof advisory and consulting services.

2021 has gotten off to a big start. The violence in Washington has already prompted a lot of people to say “I signed up for the seven-day free trial, and I’m not sure I want to pay for the rest of the year.” But opportunity is knocking, and we’ll be here to help you open the door.

System Updates

The TMN tax-planning software – which we’re looking to rebrand as “Tax Ninja Software” – has been updated for 2021 numbers. We’re now working to update collateral materials like the seminar presentations and book licenses. We’ll keep you posted as we work through our entire catalog. We’ve also begun to reorganize our member portal, which had come to resemble one of those 17th-century New England farmhouses that gets renovated and added onto so many times over 200 years that you literally can’t get from the kitchen to the bathroom without walking through the barn. We’re excited to roll out the changes and we’re sure you will be, too!

The Briefs is a weekly column on marketing and business planning for tax professionals and financial advisors looking to better serve clients and grow their business. 

Edward Lyon

Edward Lyon

Edward A. Lyon is CEO of the Tax Master Network, where he's coached tax professionals to add planning and financial services to their business since 2005. Go here to join the network. Go here to upgrade your membership or discuss opportunities in financial services.
Edward Lyon

Edward Lyon

Edward A. Lyon is CEO of the Tax Master Network, where he's coached tax professionals to add planning and financial services to their business since 2005. Go here to join the network. Go here to upgrade your membership or discuss opportunities in financial services.

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