Updating your tax planning strategy for the new “normal”

I am supposed to be married on August 1, 2020, though it remains to be seen whether that will be possible, given the coronavirus pandemic. Like many other “corona brides,” I have spent the last few months trying to determine whether to postpone my wedding, continue with a much smaller wedding or just elope, while also closely monitoring guidance from the CDC and state and local governments.

While I have tried to remain as calm as possible and focus on things I can still accomplish now, like finalizing my vows or picking out a first-dance song, the coronavirus has completely upended my wedding planning process.

Similarly, in my professional life, the pandemic has completely changed the tax planning landscape. I have been having many conversations with clients over the past few months about how to adapt their tax planning strategy to the post-coronavirus world.

The CARES Act and other IRS guidance have created tax planning opportunities that allow banks to reduce their income tax bills or even receive refunds on income taxes paid in prior years. Changing the AMT credit carryforward to being 100% refundable, allowing for 100% bonus depreciation deductions on interior real property improvements like branch remodels, or creating a five-year net operating loss carryback period — there are many different options, often retroactive to the 2018 tax year, to help taxpayers soften the blow of this pandemic from an income tax perspective.

Reach out to your Wiplfi team or visit wipfli.com/fi to help you navigate and update your tax planning strategy for the new "normal."