Income Taxes

Navigating Financial Waters with Brookstone Capital Management

Tomasina Hill

May 13, 2024

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Introduction

Why Partner with Brookstone? In today’s Cardinal lesson, we breakdown our collaborative relationship with Brookstone Capital Management (BCM). As licensed financial planners under BCM’s umbrella, we provide you with an insightful look into how your financial planning and investment management needs are meticulously catered to, guided by the principles of the Investment Act of 1940.

Understanding Brookstone Capital Management Brookstone Capital Management, a pivotal player in our investment strategies, operates as a Registered Investment Advisor (RIA). They are not just a firm; they are innovators who craft the investment baskets we use to tailor strategies specifically suited to our clients’ needs. This segment explains what being an RIA entails and how BCM’s expertise impacts your investments.

Our Team’s Role and Responsibilities Discover the faces behind your financial planning. Hans, Tom, Jamie, and Drew are not just your advisors; they are Investment Advisor Representatives (IARs) who navigate the complex world of investments under the BCM banner. Learn about our personal commitment to your financial health and how we utilize BCM’s resources to offer top-tier financial advice.

Custodial Services: Safeguarding Your Investments Our partnership extends beyond Brookstone to include custodians like Charles Schwab and Fidelity, who play a crucial role in safeguarding your assets. This section clarifies their role in the broader context of your investment strategy, emphasizing security and compliance.

Comprehensive Financial Planning

More Than Just Investments Investments are just a part of what we do. This comprehensive discussion highlights our approach to financial planning, which covers a broad spectrum of financial needs from retirement planning to estate management, emphasizing the personalized nature of our services.

The Brookstone Difference

A Three-Part Harmony Explore how the synergy between Cardinal, Brookstone, and our custodial partners benefits you. Each entity has a distinct role, creating a robust system of checks and balances that ensures your financial plans are executed with precision and your best interests in mind.

Conclusion

Your Financial Journey with Us As your financial planners, we are committed to more than just managing your investments. We are here to guide you through every step of your financial journey, ensuring that every decision aligns with your overall life goals. Join us as we continue to explore new ways to serve you better and keep your financial future secure.

Get In Touch

Contact us today with any questions, concerns, or just to stay connected.

Have questions? Contact us today.

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Income Taxes

Navigating Financial Waters with Brookstone Capital Management

Tomasina Hill

May 13, 2024

Share

Sign Up For Our Newsletter To Receive Weekly Updates.

Understanding the Upcoming 2026 Income Tax Increase: What You Need to Know

A Brief History of the Tax Cuts and Jobs Act (TCJA)

In today’s Cardinal lesson, we’re discussing the significant changes coming to income tax rates in 2026. This isn’t a proposal but a law already set in motion. The Tax Cuts and Jobs Act (TCJA), passed in 2017 and effective from January 1, 2018, brought about substantial reductions in income taxes. However, these reductions were only funded for eight years, meaning they will expire at the end of 2025.

What Changes to Expect in 2026

As of January 1, 2026, the tax rates will revert to their 2017 levels, adjusted for inflation. Key changes include:

The 12% bracket will increase to 15%.
The 22% bracket will rise to 25%.
The top rate of 37% will revert to 39.6%.

Not Just a Proposal

It’s crucial to understand that this change is already the law. Many people mistakenly believe that the tax rate increases are still under discussion. However, unless Congress enacts new legislation, these higher rates will take effect as scheduled.

Implications for Your Financial Planning

Impact on IRAs and 401(k)s

With the current lower tax rates, now is the time to consider strategies like Roth conversions. By converting funds from a traditional IRA to a Roth IRA now, you can potentially save a significant amount in taxes over the long term.

Why Planning Ahead is Crucial

For individuals with substantial retirement savings, understanding these changes is vital for effective tax planning. The window to take advantage of the current lower tax rates is closing, and planning ahead can make a significant difference.

Case Studies and Planning Opportunities

Hans Scheil and Tom Griffith discuss specific case studies and planning strategies in our latest video. These examples illustrate how different scenarios can be managed effectively:

Case Study 1: A married couple with an adjusted gross income of $150,000 in 2024 can convert part of their IRA to a Roth IRA, taking advantage of the lower current tax rates.
Case Study 2: High-net-worth individuals with large IRAs can save substantial amounts in taxes by planning conversions over the next two years.

Estate Tax Considerations

The TCJA also doubled the estate tax exemption, which will revert in 2026. This change can significantly impact high-net-worth individuals, making estate planning more crucial than ever.

Action Steps to Take Now

Review Your Current Tax Situation: Analyze how the upcoming changes will affect your finances.
Consider Roth Conversions: Take advantage of the lower tax rates before they expire.
Plan for Estate Taxes: Assess your estate plans in light of the changing exemptions.

Conclusion

The changes coming in 2026 are significant, but with proper planning and informed decision-making, you can navigate these changes effectively. Watch our video for more detailed insights and personalized advice.

Get In Touch

Contact us today with any questions, concerns, or just to stay connected.

Have questions? Contact us today.

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Investment advisory services offered through Brookstone Capital Management, LLC (BCM), a registered investment advisor. BCM and Cardinal Advisors are independent of each other. Insurance products and services are not offered through BCM but are offered and sold through individually licensed and appointed agents. The content of this website is provided for informational purposes only and is not a solicitation or recommendation of any investment strategy. Investments and/or investment strategies involve risk including the possible loss of principal. There is no assurance that any investment strategy will achieve its objectives. Index or fixed annuities are not designed for short term investments and may be subject to caps, restrictions, fees and surrender charges as described in the annuity contract. Any comments regarding safe and secure investments, and guaranteed income streams refer only to fixed insurance products. They do not refer, in any way to securities or investment advisory products. Fixed Insurance and Annuity product guarantees are subject to the claims paying ability of the issuing company and are not offered by Brookstone Capital Management. Information provided is not intended as tax or legal advice, and should not be relied on as such. You are encouraged to seek tax or legal advice from an independent professional. Cardinal Advisors is not affiliated with or endorsed by the Social Security Administration or any other government agency. Any review of “The Complete Cardinal Guide” is specific to the book and is not an endorsement of the advisor.