Tax Lawyer Explains What Trump's Win Means For Your Taxes

This year in this country, we now have an answer. We know who our president's going to be. We've been in a giant holding pattern. How many of you have held off making a major decision in your business, buying a home, expansion in your business, paying off debt? Who knows, right? We've been in a holding pattern. Well, guess what? I have some answers for you. I have a crystal ball. That's right. I'm going to tell you what to expect with the new tax policy this next year so that you can make decisions investing and with your business and with your plans. People, the time has come. It is time to go, and we're going to freaking do it. Main Street, America. This is what we've been waiting for, is some answers, some vision, some direction. And I am so excited, inspired. I'm almost emotional here. In fact, I am, because I'm excited to talk about this and I want to give you some answers. I'm a CPA, an attorney. I've been doing this for 25 years. I have a law firm, a trust company. I've been training accountants all over the country. And we are in the weeds. We are with our small business owners every week trying to help them make decisions about their businesses and saving taxes. So I'm going to give you some answers. And if you have questions, I want you to type them down below in the platform that you're listening here. And I'm going to do my best to answer them. But I'm going to tell you some cold, hard facts and what to expect on your tax bill this coming year and some maybe a few tips right before year end that you need to take advantage of. Well, as well. So now let's ask the crystal ball what we should expect. Pretty cool, right? Okay. I hear the crystal ball saying, mark, look at the facts right now. All right, what are the facts? Oh, interest rates got cut today. They're now between 4.5 and 4.75%. Nasdaq had a record day over 19,000, the highest level of Nasdaq ever. Crypto is up 10%. New record with Bitcoin. This is all today. What else have we got? Stocks are soaring. Reported by the np, by NPR and other news agencies. You know what this is? This is a. It creates a ripple effect. These things alone, the stock market up, crypto up. We've got NASDAQ up. We've got lower interest rates. What happens? Inflation goes down, the cost of product and services go down. That's how it works. Thank you. Crystal ball. That was pretty cool. Well, what about our taxes? Oh, let me answer that one. Well, let's see. Thanks to Donald Trump, we have a little example of what he did before. Now, you may have not voted for Donald Trump. That's okay. He's the quarterback on the field right now. We're behind the team. Let's, let's have him deliver. He's promised he's going to deliver some new things for us. Well, the first thing he said, I'm going to extend the same tax cuts we passed almost eight to 10 years ago in 2016, the tax cuts and Jobs Act. So let me tell you what was going to happen as well as what's. In fact, I want to say it differently. I want to tell you what's going to happen now. We are going to see tax rates stay right where they're at because he promised we're going to keep those tax rates. That helps every tax rate of every taxpayer, rich or poor, everywhere in between. The tax rates are going to stay at 12, 22, 24, 32, 35 is the top bracket. Now if we wouldn't have had this change, they could have been as high as 15, 25, 28, 35 and 39.6. So the first thing that you can depend on, and the crystal ball doesn't lie, oh, yeah, tax rates will stay the same, which is going to save over 68% of Americans would have been affected by higher tax rates. They're going to stay the same. That means you're going to have more discretionable income next year. And I want you to start planning your expansion now in your business, buying more investment property, buying more investments and getting out of debt. Now, number two, I'm going to crystal ball. What about standard deductions? Oh, standard deductions are going to go up now. We can plan on it. We can depend on it. Standard deductions in 2025 should be $14,600 if you are an individual or 20, $10,200 if you're married. They would have been a measly 8,300 or 16, 9, 16 6. Ugly. Not good. But not anymore. We got the crystal ball. We've got a new administration. We've got Congress. We've got the Senate, the House and the White House and a mandate by America. The popular vote spoke and they said bring us tax savings, extend the Tax Cuts and Jobs Act. Crystal ball says it's going to happen. And I say it's going to happen and it's going to impact your bottom line. Third, the SALT deduction for Those of you that itemize, that have mortgage mortgages on homes, you pay a lot in state tax. Donald Trump said, I am going to remove the cap on salt and we're going to continue the mortgage interest deduction, which I think will be increased because of the cost of homes and the amount of mortgages. So I am promising an increase in the itemized deduction. Schedule A. For those of you that want to get back to the Schedule A, sign me up. We're going to save more in taxes as well. Donald Trump promised the cap will be off the salt. Number four, business owners bonus depreciation. Are we going to get it back? Please tell me. Yes, we are. Crystal ball says bonus depreciation. I can see it in there. 2025, it would be down to 60% depreciation. Now it's going to be back up to 100%. Now, what that means if you're a business owner and you go buy a new computer, new equipment, a truck, a car for your business, manufacturing equipment, a forklift, backhoe, any sort of equipment, you can write off 100% of it in the year you buy it, even if you don't pay cash, you put it on a credit card, you can write off 100% of that equipment. That's bonus depreciation. The best auto deduction strategy since the 1980s. That's legit. And we're getting it back. It was there with the Tax Cuts and jobs act in 2016, 2017, and we're getting it back, baby. What? This is going to be good. All right, now, number five, what about the QBI? Oh, the QBI, that's the 199A deduction. It was passed for small business owners back in the Tax Cuts and Jobs act. It's a 20% deduction on your net income in your business. So if you make 100 grand in your business, you can take 20% off the top. Now you're only paying tax on $80,000. This stimulates the economy. This reduces inflation. This puts more net disposable income in your pocket. And guess what? Donald Trump and the Republican Congress that was there back in 2016 said we're going to extend it so you can expect this in 2025. This means we're going, we're expanding, we're growing, we're building our own economy. And I don't want to worry about the wave and what's going on in the nation. I want to worry about my own surfboard and my economy. And it's just got a lot better now. Number six. Oh, this is the final bonus that we've all been waiting for. Now, if any of you have a question, you want to freaking take it on. You want me to hit me. I want to hear it. Because this is what we've all been waiting for. We've been waiting for a quarterback on the field that's going to get our small business off the ground and going down the field. This is it. This is it. The last one. Number six, I want to bring up. No tax on Social Security, no tax on tips, no tax on overtime. What Donald J. Trump said he's going to deliver on this whether you voted for him or not. Let's root for it, let's get behind it. Let's go. This is it. This is going to affect all of us and help us raise our families, create more retirement, have a better lifestyle and, and live our American dream. And I am predicting now that all of these tax benefits will be law next year in 2025. And you may say, whoa, whoa, whoa. Are you sure he did it before? This is freaking Tax Cuts and Jobs act reloaded with a bonus. We're going to be throwing in other benefits that were promised by the Donald Trump administration. And you may say, well, how are we going to pay for all this? Well, I think Donald Trump is assembled a team that's going to help cut costs in government because, see, any tax bill has to be paid for. So if we're going to cut taxes, how are we going to pay for it? Well, we've been talking about for or we. We've been hearing Donald Trump talk about, and many of us so excited about seeing cost cut in government. We know there's ways, no matter what party you're a part of, we know there's waste. Let's get it trimmed up. Let's take that savings, give it to the American people. Let's give it to you, the Main street business owner. Guys, I've been out on the beat for 25 years talking about the American dream and small business. And I just love seeing a business owner feel some room, feel some room to breathe and to grow and to expand. I'm not going anywhere. Every week, I am here live, helping give you the answers to your questions about tax and legal strategies. I've got the books, I got the podcasts, I've got the blog articles, and I got the platform here to help you get a straight answer. So if you got a question, I'm all yours. Or we're just gonna go out and get to work. Man, I'm running out the door. We're gonna do it. So do we have a question, Dana? Any. All right, what do we got?

One of the biggest questions we have about Donald Trump with his tax policies is his use of tariffs. Are you able to explain a little bit of that for the audience?

You bet. Now, Donald Trump would talk a lot about tariffs. Now, what tariffs are is, it's a good way of thinking about it is a tax on foreign countries. If you want to come into our country and sell a product, we're going to tax it before it comes and gets on our shelf or because before it drives on our street, whatever it is, a car, we are going to tax it and charge you a tariff or a tax before you can come sell it to the American people. That's a tariff. Now, what happens is we produce a lot and send it to other countries and they have tariffs on us. But some weaker administrations will take it and not tax tariffs on the other countries. And that's called a deficit. Many times in our history, we've had a tariff deficit. We've been paying more tariffs than receiving tariffs. Well, Donald Trump back in 2016 tried to shift that tide, did it with a number of countries and wants to do it again. And so what he's saying is, if you want to come to our country and sell your product, that's cool. Give us the same deal in your country or we're going to hit you with taxes or tariffs and we're going to use those tariffs to give you these tax breaks because you got to pay for this. So tariffs are a way that the White House wants to pay for the tax benefits that you and I are going to enjoy as small business owners. All right, any other questions here?

Next question. Do you think 100% advanced depreciation will be coming back?

Well, 100% advanced depreciation. I think you're referring to bonus depreciation. And let's ask the crystal ball. Are we going to get advanced depreciation called bonus? Yes, we are. I really. We are. It's. It was at 100% for almost four or five years. Then it started to whittle down. It'll be 60% this year in 20, 60% in 2025, unless it's extended. Yes, I am predicting we will get back 100% depreciation. Now, if you say, well, that's advance, it's, it's bonus, bonus depreciation is the same as advanced depreciation. What you're saying is I'm going to write this entire thing off. In the year I acquire it, rather than over three years or five years or 15. So, yes, it's going to be back and I'm all in. Any other questions? Bring it, people. Let's talk about it. I got them. I've read the Tax Cuts and Jobs Act. I've read all of President Trump's promises when it comes to taxes. In fact, they're sitting right here, right off of his website. I've got the build the greatest economy in history plan for the tax legislation that's going to be coming down the pipe. Excited about it, and I think we're good to go. So this is going to really, really help us as small business owners create more disposable income. You have another question for us?

We have another question here says, can you please expand more on the tax benefits on starting small businesses next year?

So starting small businesses whenever you start a small business. The current deduction for a startup cost. Now this is a really good question. The startup cost deduction has been $5,000 for the last five to eight years. It was initially about 10 grand in the first year of the Tax Cuts and Jobs act and then phased out. So it's currently $5,000. Now, what this means, let's say I'm going to go start a lemonade stand. So I buy sugar, I buy cups, I build this elaborate cool stand, and I spend $4,000 before I sell my first cup of lemonade. I get to write off up to 5,000 the day I sell my first cup of lemonade. It's called a startup cost. The startup cost accumulates until I have my first sale. As long as my startup cost is below $5,000, I get to write off all those costs the day I sell my first cup of lemonade. So all of you out there, as you start to get that business ready to go, I want you to keep track of every expense. Your cell phone, legal, accounting equipment, supplies, anything, anything you spend until your first sale is considered a startup cost. If it's under 5,000, you could write it off just like that. Anything above 5,000 you have to amortize or write off over time. You would write it off over 15 years or until you close the business. If you shut the business down in two more years, you get all those write offs, they accelerate. So if I had 7,000 in startup costs, I would have to amortize the additional two. Now, Vice President Harris said, oh, I want to increase that to 50 grand. Okay, that's okay. Now, that's not a deduction. That's Not a bonus, that's not a credit. She was just saying if you spent up to 50 grand, you could write all that off in the first year. Now here's really the pro tip. This is the tactical strategy on the street. I don't want you to ever spend more than five grand before your first sale anyway. I want you to get out and sell that first cup of lemonade as fast as possible. Because the minute you have your first sale, you're out of startup mode. Now you're not using startup cost. So whether it's five grand or 20 grand or 50 grand, it's irrelevant because now you're writing off everything. So here's the tip. I'm going to say it this way, people. If you're starting a small business, the best thing you can do is make a sale as fast as possible, even this year, before December 31st. Now I can write off any costs you had this year up to $5,000, as long as you have a sale before December 31st. So it's been, it's the same rule. It's been on the books for years. It's wonderful. Get out and start a small business. Let's go. That's my answer. Let's go. Any other questions?

Another big criticism of Donald Trump during this time has been that his tax breaks are for big corporations. Is there any advantages for small businesses as well?

Oh my gosh, yes. When Donald Trump eight years ago passed the Tax Cuts and Jobs act so much. I hate to use this word, but I'm going to say it. Misinformation on what was in that Tax Cuts and Jobs act, billion dollar plus tax cut legislation. He taxed the hell out of big corporations to pay for tax cuts for the small business owner. The QBI. I just talked about it. The 20% QBI deduction, we got that in the Tax Cuts and Jobs Act. We got the ability to write off bonus depreciation on our small businesses. Better auto deduction strategies, better dining deductions. That was all in the Tax Cut and Jobs Act. It was paid for by corporations being required to bring money offshore back to the United States. And he taxed the hell out of them. He also gave them a 21% corporate tax rate. See guys, here's how the things work when there's tax legislation passed. It helps the rich, it helps the poor, it helps the middle income Americans. Just because the rich got a tax break doesn't mean no one else did. Everybody got a tax break. That's how it works. You can't throw a party without making sure everybody gets the drink they want. But the goal is, is that everybody does get something to drink and they're off to the races. So when we are going to see my predictions that I'm making here, we are going to get the same or better for small business owners than we got before. And corporations, they might get a little benefit too because they help pay the bill. And so it's a win win for everybody. Don't hyper focus on, well, I only want a tax bill that helps the small business owner. Well, okay, everybody's going to pay for that and we're not going to throw them a bone. So this is why it's called bipartisan. Everybody comes together to create a tax bill that benefits everybody. Now I want it weighted and the Tax Cuts and Jobs act was great for middle income Americans and it's going to, it's going to be there again. And so don't get hung up on that. There was tax breaks for everybody and they're going to be there for small business again. It's time to go, people. Is good. Next question, next question.

Do you think that there is a way that they could remove or do you think there's a possibility that they could remove income tax?

No, I don't, I if someone's asking if income tax is going to go away, no, we've got to pay for a few things called Social Security, called national defense, called roads, called we're not going to get rid of the income tax and we're going to have to pay for our protection as a society and what we have. And that would not be good. Now if some of you are like, hate income tax, find a country that doesn't charge it. Which is challenging because where there's no income tax, oh, you're paying for it. The cheapest income tax, I mean the most expensive income tax is no income tax at all. That's deep. So income tax is okay. I just want you to pay the least amount you have to. And knowing tax strategies is okay. It's a game. Just know the rules to the game. It's like when you go to Vegas if you play craps. Super complicated. But if you know what you're doing, you can win the most at the table. At craps, I'm more of a poker guy, a little more simpler, but I can't win as much at craps as I could at craps. But it's complicated. So the American tax code is kind of like that. It's complicated, but the more you know about it, the More you save. And I'm here every week helping teach you the loopholes, the strategies that are ethical and honest that help us as small business owners succeed. You can do it. So income tax is here to stay. It's okay. Let's just pay the least amount possible. Next.

Next question. What is Trump's plan for capital gains and cryptocurrency?

Capital gains. And Trump has been clear about this all the way along and is currently on a site. No change. There's no change to capital gains. There is no change that he's proposing in regards to cryptocurrency. Now, it's interesting. This last week, I had a family member call and go, hey, I don't want capital gains. I want ordinary income. I was like, whoa, whoa, whoa. Let me teach you all something real quick. Capital gains is good. It's a lower tax rate. You don't pay capital gains on top of ordinary. It's a different scheme. If I'm out there as a small business owner, I've got a 1099, I'm selling a product or a service. I pay tax on ordinary income. If I have investments like crypto, stock, real estate, and I sell it, I get capital gain. The highest capital gain rate is 20%. The highest ordinary rate is 35%. So I want capital gain. You don't pay capital gain on top of this. You just get to pay it separately. Now, there's one pro tip here. If you hold an Asset less than 12 months is called short term capital gain. So it kind of goes from over here. The capital gain over here and now it's called short term capital gain is taxed as ordinary rates. So short term capital gain is the same as ordinary. So the strategy is hold everything 12 months. If you hold it at least 12 months, you get the lower tax rate, which is called capital gain. Donald Trump has said, I'm not changing that. So crypto investors. I'm a crypto investor. Crypto's up right now. I am so excited. Tax is the same. That's okay, that's okay. It's all good. Next question.

We actually have a question here. Somebody asking if you have any trusted certified tax advisors in Northern Virginia?

Oh, yeah. So quick side note here is one of the game changing strategies that I'm, I'm highly, highly encouraging all of you to take advantage of as we see these new tax strategies come down the pipe. And 2025 is going to be exciting for us nerds out here. This is a big deal. So 2025, we're going to See all of these tax benefits that I just promised? This is going to be exciting. You need a tax advisor to help implement them. This isn't something you normally knock out on TurboTax unless you really kind of know what you're doing. So I have created the Main Street Tax Pro network. You can see it right here.

Boom.

The Main Street Tax Pro Network. You can get over to it@markjkohler.com I have tax pros all over the country. I know there's a number of them right here in chat, maybe saying a few words. In fact, if you're a tax pro of mine in chat on either YouTube or Facebook or LinkedIn or TikTok or Instagram, say, I'm a tax pro. These are people that speak Mark Kohler. I speak their language. We're a part of a community, a tribe. There's no one in the country teaching a certified program, meeting with weekly trainings with a network with white paper other than my network. It's out there and we're trying to help Main Street America use these tax strategies to their benefit. So they're out there. Get over to markdricoler.com and you can look at the network. Any other questions? All right, our time's up, apparently here. And I want to say thank you to all of you for listening here. Have faith this is going to work. The American dream is still alive, is still there, and the tax strategies are going to be coming down the pipe like a firestorm. It's going to be excited. It's going to be exciting. Interest rates are down, stock market's up, crypto's up, interest rates are down. And that means inflation is going just like this, people. It's time to expand. It's time to go. I've given you the tax strategies to plan for. It's going to be an exciting year. I'll be here next week talking about year end tax tips. I've only thrown down three or four in the last month. It's time to get go hard. I'll be here every week until the end of the year giving you tax tips before year end. There's things you could do right now to save taxes in 2024.