Partners Group LTD

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Image: Kiplinger

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We’re nearing the end of the 2026 tax season and it’s never too early to begin preparing for next years changes.

2027 is shaping up to be a pivotal year due to the scheduled expiration of key provisions from the Tax Cuts and Jobs Act (TCJA). Unless new legislation is passed, many of the tax benefits introduced in 2018 will revert to prior rules. This includes lower individual tax rates increasing, the standard deduction being reduced, and personal exemptions returning. For many taxpayers, this could mean a higher overall tax burden, even if income remains the same. Understanding these potential changes now allows for better long-term planning.

One of the most notable areas of impact is itemized deductions. The current $10,000 cap on state and local tax (SALT) deductions is expected to be removed, which may benefit taxpayers in higher-tax states. However, this comes alongside the return of limitations on itemized deductions and a lower standard deduction, making the decision to itemize more relevant again. Estate and gift tax exemptions are also set to decrease significantly, potentially affecting high-net-worth individuals and families focused on wealth transfer strategies. For business owners, the 20% qualified business income (QBI) deduction may be reduced or eliminated, which could directly impact pass-through entities.

From a planning perspective, 2027 is less about reacting and more about preparing. Strategies such as accelerating income, deferring deductions, maximizing retirement contributions, and reviewing entity structures may become increasingly important in the years leading up to these changes. While nothing is finalized until legislation is passed, the potential shift back to pre-TCJA rules creates a window of opportunity. Being proactive now can help minimize future tax exposure and position you more effectively for what’s ahead.

Are you planning ahead for these potential tax changes?

Interesting articles related to this topic:

1. 2026 Tax Brackets if the TCJA Expires
2. Inheritance tax and pensions: what the… | Schroders Personal Wealth

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