Enjoy Them While They Last: End of Bush Tax Cuts Could Throw U.S. into Deeper Recession
Enjoy Them While They Last: End of Bush Tax Cuts Could Throw U.S. into Deeper Recession
A few Senate Democrats recently made noise over ending the Bush Tax Cuts in January 2011 given the country’s economic prospects. Although many people have predicted that the end of the Bush Tax Cuts is a foregone conclusion, a debate is starting to percolate. Read what Alan Olsen says the repeal of the tax cuts will mean and what to do to prepare for that scenario.
Alan’s Predictions if Bush Tax Cuts Are Eliminated
Almost every tax cut implemented by Bush will disappear in 2011. Clinton raised taxes to 39%, Bush dropped the top tax rate to 36%. Obama will take it back to slightly more than 39%.
What we have now is a war of free enterprise. The end of the Bush tax cuts in 2010 could throw us into a deeper recession.
Everyone who is in the tax system will see a substantial tax increase. Extending Bush’s tax cuts past 2010 will have positive effects on consumer spending now.
The current economy needs a kick start. The Government should reintroduce the investment tax credit similar to Reagan’s move in the early 1980’s to encourage people to spend money and get American business moving again.
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The Capital Gains Tax Rate is scheduled to be raised from 15% to 20% next year. Extending the lower Capital Gains and Dividend Tax rates will encourage more people to stay invested in stocks. It will take cash off the sidelines and put it to work in our economy.
The Government needs to control spending and align budgets with tax revenues. They cannot spend their way out of this recession. If the economy continues to be stripped of liquidity, everybody will be hurt.
Alan’s Recommendations to Prepare Yourself if Tax Cuts are Not Extended
Hold onto to your cash and build a reserve. Get your financial plan in order and get out of debt. Debt will be harder to retire in an economy that continues to deleverage.
Focus on cash flow investments. Invest in real estate with positive cash flow. That means a higher down payment than what has historically been done. Use the building depreciation to shelter cash flow from taxes.
Make sure you stay divested and diversify your investments.
If you’re in the top tax bracket, invest your income wisely or lose it to taxes.
If you’re retiring on a fixed income, move to states with a lower cost of living and lower tax rates.
We hope you found this article about “Enjoy Them While They Last: End of Bush Tax Cuts Could Throw U.S. into Deeper Recession” helpful. If you have questions or need expert tax or family office advice that’s refreshingly objective (we never sell investments), please contact us or visit our Family office page or our website at www.GROCO.com. Unfortunately, we no longer give advice to other tax professionals gratis.
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Alan Olsen, is the Host of the American Dreams Show and the Managing Partner of GROCO.com. GROCO is a premier family office and tax advisory firm located in the San Francisco Bay area serving clients all over the world.
Alan L. Olsen, CPA, Wikipedia Bio
GROCO.com is a proud sponsor of The American Dreams Show.
The American Dreams show was the brainchild of Alan Olsen, CPA, MBA. It was originally created to fill a specific need; often inexperienced entrepreneurs lacked basic information about raising capital and how to successfully start a business.
Alan sincerely wanted to respond to the many requests from aspiring entrepreneurs asking for the information and introductions they needed. But he had to find a way to help in which his venture capital clients and friends would not mind.
The American Dreams show became the solution, first as a radio show and now with YouTube videos as well. Always respectful of interview guest’s time, he’s able to give access to individuals information and inspiration previously inaccessible to the first-time entrepreneurs who need it most.
They can listen to venture capitalists and successful business people explain first-hand, how they got to where they are, how to start a company, how to overcome challenges, how they see the future evolving, opportunities, work-life balance and so much more..
American Dreams discusses many topics from some of the world’s most successful individuals about their secrets to life’s success. Topics from guest have included:
Creating purpose in life / Building a foundation for their life / Solving problems / Finding fulfillment through philanthropy and service / Becoming self-reliant / Enhancing effective leadership / Balancing family and work…
MyPaths.com (Also sponsored by GROCO) provides free access to content and world-class entrepreneurs, influencers and thought leaders’ personal success stories. To help you find your path in life to true, sustainable success & happiness. It’s mission statement:
In an increasingly complex and difficult world, we hope to help you find your personal path in life and build a strong foundation by learning how others found success and happiness. True and sustainable success and happiness are different for each one of us but possible, often despite significant challenges.
Our mission at MyPaths.com is to provide resources and firsthand accounts of how others found their paths in life, so you can do the same.
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