Trump's New Tax Proposal and YOUR IRA [EPISODE #263]

by | Apr 27, 2017

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Trump's New Tax Proposal and YOUR IRA [EPISODE #263]

by | Apr 27, 2017

The Big Idea

The Trump Administration has proposed a series of tax cut objectives which will, as a whole, have tremendously stimulative effect on the economy.  But there's one problem:  Part of the proposal could hurt your self-directed IRA...

Points To Ponder

  • The Trump Administration has provided a list of policy goals which will dramatically reduce personal and corporate tax rates
  • The effects of such tax cuts will be very stimulative to the economy, as has been shown repeatedly and undeniably in the past
  • Part of the proposal is to reduce corporate income tax rates from 35% to 15%
  • Much to the delight of most observers, Trump wants to extend that rate to pass-through entities like LLC's and S-Corporations, which will result in an effective tax cut there as well
  • However, if your own an LLC in your IRA, it could mean that your LLC is obligated to pay 15% tax on its profits, which would defeat the purpose of owning the LLC in an IRA
  • This is not a certainty and may be worked out as these policy goals are translated into law
  • You must stay informed about this issue in case it becomes necessary to reach out to your representatives.  Do that by subscribing to this show now.

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2 Comments

  1. Kay Redding

    How does the new tax plan affect Roth IRAS?

    Reply
    • Bryan Ellis

      So far, there's no indication it will affect Roth IRA's in any way, other than the potential problem I mentioned in this episode about pass-thru entities in your IRA being taxed at 15%. I don't see the Trump administration doing anything that discourages anyone from saving and investing.

      Reply

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Bryan Ellis is host of Self Directed Investor Talk, America's #1 radio show and podcast for affluent self-directed investors.  He's also an expert in self-directed IRA's, solo 401k's and turnkey rental property investing... at least, that's what his wife tells him 🙂  He's a contributor to well-respected publications like TheStreet.com, Entrepreneur and ThinkRealty.  Bryan lives in metro Atlanta, Georgia with Carole Ellis - his wife, business partner and best friend - and his 4 children ranging in age from 2 to 19.