With the Tax Cuts and Jobs Act signed into law by the President, the following are a few actions that, if taken by year-end, may soften the impact of a few of the disappearing or reduced deductions:

For contributions made in tax years beginning after December 31, 2017, the Act eliminates the allowance of charitable deductions for payment to an institution of higher education in exchange for the right to purchase tickets or seating at an athletic event.  Therefore, we recommend making 2018 contributions for college athletic ticket programs prior to December 31, 2017.

The Act limits the itemized deduction for payment of state and local taxes to $10,000 for tax years beginning after December 31, 2017.  Therefore, we recommend that your scheduled 4th quarter 2017 state estimate installment be made by December 31, 2017. If you expect to owe additional state tax for 2017, we recommend that your payment consider the expected increase and that it be made by December 31, 2017.  Prepayment of 2018 state tax will not be allowed as an itemized deduction on your 2017 tax return.

For qualifying business assets placed in service after September 27, 2017, a 100% first-year bonus depreciation deduction is allowed.  This additional first-year depreciation deduction is allowed for new and used property.

Under the Act, you will not be able to undo a conversion of funds from a traditional IRA to a Roth IRA. If you converted a fund in 2017 and have changed your mind, you only have until December 31, 2017 to undo that conversion.

We are continuing to review the numerous provisions of the new tax law and will provide more analysis in the future.

Please consult your JMF accountant for questions or further discussion about how these suggestions may affect your tax situation.