Seth is back with another installment of “What’s New(s)?” highlighting the topics that he’s following closely which might have an impact on you, as well as some others that he thinks you might find interesting or fun.
Governor Charlie Baker has a new budget plan that could change the draconian Massachusetts state estate tax structure. Baker’s proposal would raise the MA estate exemption threshold from $1 million to $2 million and would only tax property above $2 million. MA currently has a cliff tax, which means if you surpass the threshold then the full value of the estate is taxable.
Now that Build Back Better has lost momentum, House Democrats are looking at alternatives for raising the SALT deduction cap. One proposal would lift the cap for most tax taxpayers and raise the limit to $60k for certain high earners.
The IRS issued guidance around the SECURE Act of 2019 and surprised many with their interpretation of the rules around inherited IRAs. Those who inherited after 2019 may need to take RMDs in years 1-9 before fully distributing the IRA in year 10.
The Fed raised rates by .75% on 7/27, a move to help subdue inflation. The Fed funds rate started the year at 0-.25% and is currently at 2.25-2.5% – this is the second consecutive month with a rate hike as high as .75%. The Fed will meet again in September and further hikes are possible.