Why Now is the Best Time for Year-End Tax Planning
By Mark Sipos, LFG Tax Director While the holiday season may seem far away, the final quarter of the year is the most important time to prepare for taxes. Once the calendar turns, your options for reducing tax liability and maximizing savings narrow significantly. Taking action now allows for flexibility and better results. One of the first steps is reviewing income, deductions, and potential tax strategies while there is still time to implement them. For some, it may make sense to defer income to the new year or accelerate expenses into the current year. Charitable contributions and pre-paying certain taxes are additional ways that have the potential to strengthen your tax position before December 31. The new “Senior Bonus," an additional $6,000 per person for those age 65 and over, can be a great opportunity to create tax savings, increase ROTH conversions, and help offset taxes on Social Security income. There are income thresholds that can impact the amount you can deduct, so careful planning is important. Investors should also consider tax-loss harvesting, a strategy that offsets gains with underperforming investments. Starting this process early can help maximize tax benefits and prepare portfolios for the year ahead. Retirement contributions are another key area. Individuals still have time to maximize 401(k), 403(b), 457, Health Savings Accounts, and Flexible Spending Plans. Business owners can take advantage of SEPs, SIMPLEs, or even cas
The investment implications of the government shutdown
Our team employs external financial research from many different economists, analysts and research firms. This research provides valuable input into how we actively monitor and manage your portfolio. Periodically, we share this research with you in addition to our own analysis and market commentary. Linked below is a piece by J.P. Morgan that examines the investment implications of the government shutdown. The federal shutdown, which started Oct. 1, poses three broad problems for the economy, namely, the drag from the shutdown itself, the confusion it is causing on the state of the economy and the fact that it has occurred when the economy was likely already entering a soft patch. Enjoy the analysis from J.P. Morgan, and thanks for your confidence in our team at Lineweaver! Please click here to
The Tax Impact of Lower Interest Rates
By Mark Sipos, LFG Tax Director Federal Reserve interest rate drops indirectly impact taxes by influencing the economy, which can affect how and what you're taxed on. Lower rates can lead to higher asset values or increasing potential capital gains taxes, but they also reduce inflation's effect on tax bracket adjustments, potentially pushing more income into higher tax brackets. Additionally, lower rates encourage borrowing and spending, which can be inflationary and impact future tax policies, and can make certain charitable giving strategies more attractive. Impact on Income and Capital Gains Taxes Inflation and Tax Brackets: Lower interest rates are often linked to slowing inflation. Since federal tax brackets and standard deductions are adjusted for inflation, a slowdown in inflation means smaller adjustments, potentially pushing more of your income into higher tax brackets and increasing your tax liability. Asset Values and Capital Gains: Lower borrowing costs from rate cuts can boost asset values. This increased value can lead to higher capital gains when those assets are sold, potentially resulting in higher capital gains taxes. Higher Interest Income Tax: Lower rates mean lower interest earned on savings accounts and investments, but this lower interest income is still taxable at ordinary income tax rates. Tax-free investments or qualified dividends may be more tax-efficient. Impact on Tax Policy Shifting Tax Structures: Sustained low
Key outcomes of the Federal Reserve’s interest rate decision
By Chad Roope, CFA ®, Chief Investment Officer This month, we highlight the key outcomes of the Federal Reserve (Fed) interest rate decision announced on Sept. 17. Overall, the decision was what we expected. Here is a brief summary: Interest rate cut: The Fed cut its federal funds rate by 0.25 percentage point, lowering the target range to 4.00%–4.25%. This is the first rate cut since December 2024. Voting: The decision was mostly unanimous: 11 out of 12 voting members supported the 0.25-point cut. The sole dissenting vote came from Stephen I. Miran, who preferred a larger cut of 0.50 percentage points. Balance of risks & stance: The Fed noted that growth has moderated, job gains have slowed, and unemployment has edged up, though it still remains low. Inflation remains elevated but isn’t accelerating at the same pace; there’s more concern now about economic weakness and risks to employment. The Fed emphasized that it will carefully assess incoming data and adjust policy as appropriate. Projections / Outlook From the Fed’s Summary of Economic Projections released alongside the decision: GDP growth: The median projection for U.S. real GDP growth in 2025 is about 1.6%, rising modestly in subsequent years. Unemployment rate: The unemployment rate is expected to be around 4.5% in 2025, with slight declines in 2026-2027, barring worse-than-anticipated weakening. Inflation (PCE): Inflation (the PCE m
Tax changes under the One Big Beautiful Bill Act
By Mark Sipos, LFG Tax Director The passage of the One Big Beautiful Bill Act has been one of the most discussed topics coming out of Washington in the past few weeks. LFG Tax Services is diving into the new legislation, deciphering what it means for our clients, and keeping a close watch on tax planning opportunities and IRS interpretations of some of its components. Here are a few highlights we think will be of interest to you: The TCJA rate schedules for tax years beginning after December 31, 2017, are now permanently extended, as well as several key parts of the 2017 Act. No Tax on Tips: A temporary deduction of up to $25,000 in tip income for workers in “customarily tipped” occupations. Individuals phased out for MAGI above $150,000 and Joint filers at $300,000. Expires December 31, 2028. No Tax on Overtime: Temporary above-the-line deduction of $12,500 (single) / $25,000 (joint). Deduction phases out at $150,000 of MAGI (single) / $300,000 (joint), expiring at the end of 2028. The lifetime estate tax exemption has been permanently increased to $15 million (indexed for inflation) per US person. The Act stopped short of a full repeal and would essentially extend the current generous lifetime estate tax exemption. The limit means that only the wealthiest 1% or fewer taxpayers would ever face a tax on their estate after death. The qualified business income deduction under IRC Section 199A is now made permanent at 20%. The phase-in of the limit
Harness the Superpower of Compounding While Reducing “Tax Drag”
By Chad Roope, CFA ®, Chief Investment Officer Compounding is the superpower of investing. Following the Rule of 70, an investment averaging 10% per year will double in just seven years. That’s the kind of growth that builds real wealth over time. But there’s a catch. Anything that slows compounding, even slightly, can have a dramatic impact on your long-term results. One of the biggest threats to that is unnecessary taxes. In the chart below, a JP Morgan analysis shows that a modest 1% annual “tax drag” on a $1 million investment in the U.S. stock market from 2014 to 2024 would have reduced its value by $326,000. At 2%, the loss jumps to $625,000. That’s money that could have been working for you. We all must pay our fair share of taxes. However, we should be very mindful about not paying extra. At Lineweaver, we employ proven, proactive strategies to help reduce unnecessary taxes so you can keep more of your gains compounding year after year. Systematic Tax Loss Harvesting Throughout the course of the year, some investments rise while others fall. That’s diversification for you. But we can help with taxes and get the benefits of diversification at the same time. For example, if a particular company hits a rough patch and we have a loss in the stock in a taxable account, we can sell the stock and harvest the loss to help with taxes. We can then reinvest the proceeds in a different company that we either like better or
Simple ways to spot, avoid and report scams
At Lineweaver, your financial security is one of our highest priorities, and that means staying ahead of potential threats. We are constantly seeking credible, trusted resources to help protect our clients, and when we find information worth sharing, we make it a point to get it into your hands. That’s why we want to share this “Scam Squad Guide” developed by Cuyahoga County’s Department of Consumer Affairs. This valuable resource offers clear, practical strategies to help you recognize, avoid, and report scams before they can cause harm. By understanding how scams work and having a plan in place, you can take an important step toward safeguarding both your personal information and your financial accounts. To read the guide, follow this link: “Scam Squad Guide: Simple ways to spot, avoid and report scams” For those of you who live outside of the county, reach out to your county officials for the appropriate contact information to report a
Are You Ready for the Great Wealth Transfer?
Over the next two decades, Baby Boomers are expected to pass down more than $84 trillion1, making it the largest wealth transfer in U.S. history. For many families, this inheritance represents a life-changing opportunity, but it also comes with important financial challenges. Navigating an Inheritance: What to Do First Before making any decisions, take time to process your loss. Once you’re ready, gather all key legal and financial documents such as wills, trusts, account statements, and property titles. Not all assets are taxed or distributed the same, so understanding what you’ve inherited is essential. For example, an inherited IRA from a non-spouse falls under the SECURE Act and must be emptied within 10 years of the original owner’s death. If a trust is named a beneficiary, the tax bill can hit faster, so it’s important to establish that quickly. A taxable brokerage account is simpler because you get a step 11up in basis to the date 11of 11death value, meaning little or no capital 11gains tax if you sell soon. Non 11qualified annuities are trickier. Earnings come out first and are taxed as ordinary income, and most contracts force you to cash out within five years or start lifetime payouts. Common Inheritance Mistakes to Avoid Without careful estate planning, it’s easy to make costly mistakes. One example is naming a trust as a contingent IRA beneficiary without understanding the tax implications. Another is leaving an IRA to one pers
What the Social Security Fairness Act mean for Your Benefits in 2025
By Mark Sipos, LFG Tax Director If you’ve worked in a public service job, chances are you’ve heard of the Windfall Elimination Provision (WEP) or Government Pension Offset (GPO). WEP reduced Social Security benefits for individuals with pensions from jobs that didn’t pay into Social Security, and GPO reduced Social Security spousal and survivor benefits for individuals who also received a pension from a job that wasn’t covered by Social Security. But at the beginning of the year, as one of their last acts in office, the Biden Administration passed the Social Security Fairness Act (SSFA), meaning many retirees may see higher monthly payments and possibly retroactive benefits. Let’s break down what SSFA entails, how the repeals affect you, and what you need to know about the taxation of your Social Security benefits moving forward. What Changed in 2025? On January 5, 2025, the Social Security Fairness Act officially repealed WEP and GPO. This change applies to Social Security benefits payable for any months after December 2023. That means if you were previously impacted by WEP, your benefit could increase, possibly significantly. The repeal also opens the door for retroactive payments dating back to January 1, 2024. In total, more than 3.2 million Americans are expected to benefit from the elimination of WEP and GPO, according to the Social Security Administration. How WEP, GPO Repeal Impacts Public Employees and Retirees The repeal
Municipal Bond Market Spotlight
By Chad Roope, CFA ®, Chief Investment Officer U.S. municipal bonds (munis) are prized for their tax advantages, but their historic tendency to provide a stable source of return also makes them valuable amid market volatility and uncertainty. Munis are generally less vulnerable to inflation shocks or the crossfire of global trade policies because they are often linked to public authorities that provide fee-based essential services, such as waste collection and public transportation, or secured by taxes on sales, property, and income. Munis have also shown historically low default rates and high credit ratings (Aa3 versus Ba1 for global corporate debt, on average) thanks to the disciplined finances and stable revenues of most state and local governments. Tax equivalent yields of munis have reset to levels not seen in over a decade, with some investment grade yields north of 6%. Against this backdrop, we see an opportunity to increase allocations, particularly as the outlook for limited supply relative to demand in July and August could bolster performance. Additionally, munis offer a possible antidote to tariffs and recession concerns. Amid Wall Street’s growing concern over a potential tariff-induced recession, investors are seeking refuge in areas least affected by global supply chains. This is fueling interest in state and local government bonds for the following reasons: Limited exposure to trade risks: A broad-based economic slowdown would reduce state r
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Case studies are intended to illustrate the types of financial issues faced by actual clients. They should not be construed as a testimonial for or endorsement of Lineweaver Wealth Advisors. They do not represent the experience of any advisory client. Each client’s situation is different, and their goals may not always be achieved. Lineweaver Wealth Advisors, LLC, is not engaged in the practice of law or accounting. Tax information provided is general in nature and should not be construed as legal or tax advice. Always consult an attorney or tax professional regarding your specific legal or tax situation. Tax rules and regulations are subject to change at any time.
Crain's Cleveland Business is a print and online newspaper delivering local business news and information to Cleveland's business executives, which is published by Crain Communications Inc. The Crain's list may employ different methodology than described above for similar designations granted in other years. No clients were consulted and no fees were paid to determine the winners; the award is based on assets under management. Neither the participating candidates nor their employees pay a fee in exchange for inclusion on Crain's List. However, recipients may pay a fee to Crain, an affiliate, or an unaffiliated third party in exchange for plaques or article reprints commemorating the designation. The publication should not be construed by a client or prospective client as a guarantee that they will experience a certain level of results if the recipient is engaged, or continues to be engaged, to provide investment advisory services; and should not be construed as a current or past endorsement of the recipient by any of its clients. In 2025, 2024, 2020 and 2019 Lineweaver Wealth Advisors (“LWA”) was ranked in the Top 25 of Crain’s of Cleveland’s annual list of Registered Investment Advisors. In 2023, LWA was ranked in the Top 15 of Crain’s of Cleveland’s annual list of Registered Investment Advisors. In 2021 and 2022, LWA was ranked in the Top 20 of Crain’s of Cleveland’s annual list of Registered Investment Advisors. For all years the awards were based on assets under management.
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