Search Results

A Roth IRA conversion is a proactive financial move that can save you thousands in lifetime taxes and substantially increase legacy value to heirs. This article outlines the benefits of Roth IRA conversions, accounts that are eligible to be converted, and key considerations for suitability and the optimal time to convert. What Is a Roth IRA Conversion? A Roth IRA conversion involves transferring funds from a tax-deferred retirement account, such as a traditional IRA, into a Roth IRA. The converted amount is considered taxable income in the year of the conversion, but once in the Roth IRA, your money grows tax-free and can be withdrawn tax-free in retirement. The following are examples of retirement accounts that are eligible for Roth IRA conversion: Traditional IRA and Traditional 401(k) 403(b) SEP IRA SIMPLE IRA Solo 401(k) Key Benefits of Roth IRA Conversions 1. Tax-Free Growth and Withdrawals: Unlike tax-deferred retirement accounts, only post-tax dollars can be contributed to a Roth IRA. The primary appeal of a Roth IRA is entirely tax-free appreciation and retirement withdrawals. Strategic execution of a conversion can enhance the long-term growth of your wealth, lead to more income to spend in your retirement years, and leave more wealth remaining to pass along to your children. 2. No Required Minimum Distributions (RMDs) Unlike traditional IRAs, Roth IRAs are not subject to required minimum distributions during your lifetime. This allows your account to continue growing tax-free for a longer period and provides greater flexibility in retirement income planning.   3. Estate Planning Advantages Since Roth IRAs are not subject to RMDs, the account can be preserved and passed down to your children. Beneficiaries will eventually have to take distributions, but they can do so tax-free over a 10-year period under current IRS rules, potentially extending the tax-free growth period. Roth IRA assets also avoid the dreaded “double tax” Income in Respect of a Decedent for your heirs. Strategic Considerations for Roth IRA Conversions Due to the immediate tax consequences, Roth IRA conversions must be approached with thoughtful planning and execution to optimize the benefits. Convert During Low-Income Years: The ideal time to do a Roth conversion is when your taxable income, and thus your tax rate, is temporarily lower. This could occur during a sabbatical, early retirement before claiming Social Security or pensions, or after a job loss. Converting during a lower-income year reduces the overall tax burden and maximizes long-term growth of your wealth. Be Mindful of Market Conditions: If the value of your tax-deferred retirement account is temporarily lower due to a stock market slump, the taxes you will owe upon converting will be less than if you convert after a period of strong stock market performance.   Partial Conversions Over Time: Instead of converting your full account in a single year, the optimal approach is often times to convert smaller amounts over several years. This strategy helps avoid bumping you into a higher tax bracket that could also trigger higher Medicare premiums. Coordinate with Tax Brackets: Being mindful of federal income tax brackets allows you to convert just enough to "fill up" a lower bracket. For example, if you’re in the 22% tax bracket and have room before hitting the 24% bracket, you can convert an amount up to that income threshold to minimize taxes. Pay Taxes with Outside Funds: To get the most out of a Roth conversion, it’s best to pay the taxes from funds outside the IRA. Using IRA funds to pay the tax bill reduces the amount converted and diminishes the compounding benefit of the Roth account.   Married Filing Joint vs. Married Filing Separate:  If you are married to a high-earning spouse and you retire before your spouse, filing your taxes separately during the years you convert may put you in a lower tax bracket than filing jointly and result in less immediate tax burden from the conversion.   Will You Need the Money in 5 Years or Less?: There's a 5-year holding period on withdrawals of money that was part of a Roth conversion. If you think you'll need the money within 5 years of converting, you should consider converting only the amount that you will not need in the following 5 years. Final Thoughts Roth IRA conversions are not a one-size-fits-all solution, but when timed and executed properly, they can unlock substantial tax-free retirement income and wealth creation. Whether you're in the early stages of your career or approaching retirement, it’s wise to consult with a financial advisor to determine if a Roth conversion aligns with your broader retirement and tax planning strategies.   Contact us at clientservice@riseinvestmentsusa.com  to receive a complimentary and customized analysis of whether a Roth IRA conversion strategy could be beneficial for you. Disclosure RISE Investment Management, LLC ("RISE" or "RISE Investments") is an investment adviser registered under the Investment Advisers Act of 1940. Registration of an investment adviser does not imply any level of skill or training. This publication is solely for informational purposes and past performance is not indicative of future results. Any description of products, services, and performance results of RISE contained in this publication are not an offering or a solicitation of any kind. No advice may be rendered by RISE Investments unless a client service agreement is in place. Advisory services are only offered to clients or prospective clients where RISE Investments and its representatives are properly licensed or exempt from licensure. All of the information in this publication is believed to be accurate and correct as the date set forth. RISE does not have or accept responsibility or an obligation to update such information. Please note, this article is for education purposes and should not be treated as tax or legal advice. This article is not a substitute for legal or tax advice from your professional legal or tax advisor.

President Donald Trump's 2025 tax bill, dubbed the "Big Beautiful Bill," introduces many potential changes to the U.S. tax code. While it has stirred up opposing views about how much it could impact the Federal deficit, the legislation aims to make permanent most of the provisions from the 2017 Tax Cuts and Jobs Act, reduce non-military government spending, and increase defense funding. Yet as currently proposed, certain provisions may stand to disproportionately benefit some households over others.   This article outlines some of the material provisions included in the bill for taxpayers, who may stand to benefit from each provision, and what you can do to prepare.   Note: As of the time of writing this article on June 18, 2025, the bill had been passed by The House of Representatives. On June 16, the Senate unveiled proposed changes, which are reflected here. The bill must still be passed by the Senate and then sent back to The House for another vote. As a result, the bill has not yet been fully passed. Many revisions may still be on the table prior to being signed into law by the self-imposed July 4 deadline. Permanently Higher Standard Deduction The bill would permanently raise and extend the standard deduction. The standard deduction is currently $15,000 for single filers and $30,000 if you are married and file jointly. The bill would raise these to $16,000 and $32,000, respectively. The purpose of the standard deduction is to serve as an incentive for taxpayers not to itemize deductions when filing their federal income taxes.   Take inventory of your potential deductions. If they exceed the standard deduction, then it may be in your best interest to itemize. However, you should always seek advice from a qualified tax advisor.   Bonus Deduction for Those Age 65 or Over While President Trump has long proposed eliminating taxes on Social Security benefits, that did not make it into the bill. However, the bill includes a new $6,000 “bonus” deduction for seniors through 2028. The deduction phases out for single filers with Modified Adjusted Gross Income (MAGI)  of $75,000 or more and married couples with $150,000 or more. Individuals over 65 years old with incomes below these thresholds stand to benefit.   If you are planning to retire in the next few years, have not yet started taking Social Security benefits, and you expect your retirement income (with the inclusion of Social Security benefits), to be on the cusp of the phase-out threshold, you may consider the pros and cons of waiting until age 70 to start taking your Social Security benefits, which could serve to decrease your MAGI and may qualify you to receive the deduction.    Permanent Restoration of Bonus Depreciation on Qualified Property Taxpayers may once again be able to depreciate 100% of the value of qualified property acquired after January 19, 2025 during the first year of ownership. In addition, it would also allow real estate investors to fully deduct the cost of qualifying renovations, property improvements, and certain building components in the year they are placed in service. Qualified property is expected to include investment real estate and certain depreciable business property. If passed in current form, many real estate investors would benefit greatly from this provision.   If you are a real estate investor or business owner, pay close attention to the continued progress of this bill, as it is still undergoing revisions. Cost segregation studies conducted by qualified CPAs and appraisers can help maximize the benefits of bonus depreciation by identifying assets with shorter useful lives. Permanent Extension of Higher Lifetime Estate Tax Exemption The bill would permanently extend and increase the Federal lifetime estate tax exemption to $15 million for single tax filers and $30 million for married couples in 2026. The exemptions would be indexed for inflation beyond 2026. In the absence of this permanent extension, the Federal lifetime estate tax exemption would likely drop to $7.14 million per individual ($14.28 million for married couples) in 2026. If the permanent extension passes it would result in potentially millions of dollars of tax savings for couples with estates exceeding $14.28 million. Anyone with a smaller estate would continue to be exempt from Federal estate taxes. If you have a higher net worth, this serves as a benefit to you.   If your net worth is higher than $30 million, the value of your estate in excess of $30 million may be subject to substantial estate taxes without proper planning. There are a variety of estate planning strategies that can help reduce or mitigate the burden, such as removing assets from your estate by transferring to an irrevocable trust, annual gifting strategies, or establishing an Irrevocable Life Insurance Trust. Permanent Increase to Child Tax Credit and Introduction of New “Trump Accounts” The bill would permanently increase the maximum Child Tax Credit from $2,000 to $2,200 per child, indexed annually for inflation. Without any further changes in design, this would benefit middle-income households the greatest. Lower income households would not be eligible for the maximum credit if they earn too little to owe federal taxes. Conversely, the maximum credit also starts to phase out for joint filers with combined AGI exceeding $400,000 or $200,000 for all other taxpayers. If your household income is on the cusp of the phase-out threshold and you are not currently maximizing your retirement contributions, increasing your contributions may be enough to lower your AGI below the $400,000 threshold while also setting you up for a financially healthier retirement.   The bill would also introduce new tax-exempt investment accounts meant to benefit newly born children. These investment accounts would be funded with a one-time $1,000 government payment for U.S. citizens born between from 2025 through 2028. In addition, parents would be allowed to contribute up to $5,000 annually to each qualifying child’s Trump Account.   If you are a parent with a child born in 2025 or plan to have any children by the end of 2028, your children stand to benefit from Trump Accounts, which they’ll be able to use to purchase homes, start a business, or pay for an education after reaching age 18. Permanent Renewal of The Qualified Opportunity Zone  (QOZ) Tax Incentive Since   QOZ was put into legislation as part of the 2017 Tax Cuts and Jobs Act, it has led to 313,000 new housing units at a low subsidy cost. That makes QOZ one of the most efficient and effective housing supply programs in existence. Current QOZ designations will expire at the end of 2026. Under the proposed permanent renewal, those who have recently realized capital gains from an asset sale that invest the gains in a QOZ fund may be eligible for the following tax incentives: Deferral of capital gain through 2033 if QOZ investment is made between 2027 and 2033. Capital gains invested on or after January 1, 2034 would be eligible for deferral until December 31, 2043, and so forth with rolling decennial gain recognition dates. Discount of up to 10% of deferred gains if QOZ investment is made on or after January 1, 2027 (by way of a tax basis step-up). The discount would be applied over the first six years of the investment. The deferred gain discount schedule is as follows: 3% total discount after first three years of investment 5% total discount after first four years of investment 7% total discount after first five years of investment 10% total discount after the first six years of investment   Those who hold the QOZ investment for at least 10 years would be exempt from taxation on all capital appreciation of the QOZ investment.   *Assumes the maximum current Federal long-term capital gains tax rate of 20% and that the investor is subject to net investment income (NII) tax of 3.8%. *Taxes deferred by making the QOZ investment are based on the capital gain amount invested in the fund. Includes the maximum proposed 10% reduction to deferred taxes for those who invest in 2027 or 2028. ***Assumes the investment grows at a hypothetical annualized rate of 10%. Higher net worth individuals that expect to realize capital gains from substantial asset sales between 2027 and 2028 stand to benefit the greatest from the QOZ renewal proposed deferral discount schedule. If you are tax-sensitive and in the planning stages of selling your business or any other highly appreciated asset, it may be worth considering the pros and cons of incorporating a QOZ investment in your portfolio. A prudent level of due diligence is key to understanding if the investment is suitable for your investment portfolio and overall tax strategy. QOZ entails investment risks and a financial planner can help you navigate whether it is a suitable investment for your specific situation. Ability to Deduct Interest On Auto Loans This would allow taxpayers to deduct up to $10,000 of interest paid on auto loans annually. The catch is that the car’s final assembly must take place in the United States. The maximum deduction is subject to income phase-outs starting at $100,000 for single filers and $200,000 for joint filers. All owners of U.S. assembled cars that have an auto loan stand to benefit. If you drive a car that wasn’t produced in the U.S. and are in the market for a new car, you may want to consider switching to a car that is produced in the U.S. to take advantage of the interest deduction. Permanent Extension and Enhancement of Mortgage Interest Deduction The bill would permanently extend the current provision limiting the residential mortgage interest deduction to the first $750,000 in home mortgage acquisition debt. The bill would also treat certain mortgage insurance premiums on acquisition indebtedness as qualified interest that can be deducted. Homeowners subject to paying mortgage insurance premiums stand to benefit the greatest.   If you are subject to mortgage insurance premiums, be sure to inform your tax accountant to learn if you are eligible to take advantage of the enhanced deduction. Conclusion Trump's 2025 tax bill has not yet been signed into law and is potentially subject to many additional changes and revisions before being passed. It introduces significant changes with varied impacts across demographics. In current form, certain provisions stand to benefit some households and taxpayers more than others. Planning for taxes can be overwhelming. Working with a financial planner or advisor can provide you with clarity, confidence, and a strategic action plan to optimize your tax efficiency and keep you on track to meet your long-term financial goals and objectives. Disclosure RISE Investment Management, LLC ("RISE" or "RISE Investments") is an investment adviser registered under the Investment Advisers Act of 1940. Registration of an investment adviser does not imply any level of skill or training. This publication is solely for informational purposes and past performance is not indicative of future results. Any description of products, services, and performance results of RISE contained in this publication are not an offering or a solicitation of any kind. No advice may be rendered by RISE Investments unless a client service agreement is in place. Advisory services are only offered to clients or prospective clients where RISE Investments and its representatives are properly licensed or exempt from licensure. All of the information in this publication is believed to be accurate and correct as the date set forth. RISE does not have or accept responsibility or an obligation to update such information. This article is for education purposes and should not be treated as tax or legal advice. This article is not a substitute for legal or tax advice from your professional legal or tax advisor.

Upon passing, an individual’s property may be subject to federal and state estate taxes above a certain exemption threshold. Illinois estate taxes are high and there is an Illinois estate tax exemption of only $4 million per person with no portability between spouses. Equalizing assets between spouses and utilizing credit shelter trusts are effective Illinois estate tax planning strategies. Understanding Estate Taxes and Estate Tax Exemptions An estate tax is a tax on property held by an individual at the time of their death. Both federal and state governments offer an “exemption”, which is the amount of an estate that is not subject to estate tax.   For instance, estates under $13.99 million per person, or $27.98 million for a married couple, are exempt from federal estate taxes. Estates greater than those amounts are subject to federal estate taxes which is usually at a 40% tax rate. It is worth noting that unless Congress passes legislation, the federal estate tax exemption is set to expire in 2026 and the federal estate tax exemption is estimated to decline to approximately $7 million per person.   What is the Illinois Estate Tax? Illinois residents are subject to more restrictive estate tax exemptions. Illinois has an estate tax exemption of just $4 million per person, meaning if you pass away with an estate valued at over $4 million, you will be subject to Illinois estate tax.   Also, the amount subject to Illinois estate tax is based on the entire amount of your estate , not just the value in excess of $4 million.   Illinois residents need to be aware of the key differences of the portability of their estate tax exemption at the federal and state level. Portability of the estate tax exemption between spouses means a surviving spouse can use a deceased spouse’s unused exemption in addition to their own to reduce estate taxes. Portability is allowed for federal estate taxes.   The $4 million Illinois estate tax exemption is not portable between Illinois spouses, meaning that without proper estate planning, a high net worth surviving Illinois spouse may be subject to unnecessary Illinois estate taxes.   The Illinois estate tax is calculated based on a complex calculation. For simplicity, we outlined the Illinois estate tax and the Illinois estate tax rate for various sized Illinois estates below: Strategies to Reduce Illinois Estate Taxes Illinois spouses that may be subject to estate taxes should not only “equalize” their assets between each spouse but look to utilize credit shelter or “bypass” trusts in their estate plan.   Consider the example of two Illinois couples (Couple A and Couple B), each with an $8 million total net worth.   We assume that Couple A has no bypass trusts. When the husband of Couple A passes, all the assets are titled to go directly to his wife.   Couple B had set up credit shelter trusts for both spouses. When the husband of Couple B passes, $4 million goes into a trust for his wife, utilizing the husband’s Illinois estate tax exemption. The wife now has $4 million in her name and another $4 million in a credit shelter trust for her benefit. Couple A is not able to utilize the full value of each spouse’s Illinois estate tax exemption and is subject to $680,634 in Illinois estate taxes leaving $7,319,366 to their heirs.   Couple B, with proper estate planning, can forgo paying Illinois estate taxes as both spouses’ Illinois estate tax exemptions were utilized leaving $8,000,000 to their heirs.   It is important to note that there are various other strategies for Illinois residents to consider when engaging in estate planning.             Conclusion Estate planning is often an overlooked part of an individual’s financial plan yet starting estate planning today is essential. Proper Illinois estate planning by equalizing assets between spouses and using credit shelter trusts can allow for Illinois families to preserve more wealth across generations. Disclosure RISE Investment Management, LLC ("RISE" or "RISE Investments") is an investment adviser registered under the Investment Advisers Act of 1940. Registration of an investment adviser does not imply any level of skill or training. This publication is solely for informational purposes and past performance is not indicative of future results. Any description of products, services, and performance results of RISE contained in this publication are not an offering or a solicitation of any kind. No advice may be rendered by RISE Investments unless a client service agreement is in place. Advisory services are only offered to clients or prospective clients where RISE Investments and its representatives are properly licensed or exempt from licensure. All of the information in this publication is believed to be accurate and correct as the date set forth. RISE does not have or accept responsibility or an obligation to update such information. Please note, this article is for education purposes and should not be treated as tax or legal advice. This article is not a substitute for legal or tax advice from your professional legal or tax advisor.

RISE's recent press releases and media appearences. RISE in the News RISE's recent press releases and media appearances. June 20, 2025 Think you know the basics of retirement planning? Think again. ‘There’s a lot of ignorance out there.’ MARKETWATCH May 25, 2025 Young Investors Have Time on Their Side as They Navigate a Tricky Economy BARRON'S April 21, 2025 Why Younger Financial Advisors Are Starting Their Own Firms BARRON'S April 18, 2025 An Alternative Way To Invest in the S&P 500 ADVISORPEDIA April 8, 2025 Americans are more invested in the stock market than ever — and that may be adding to the recent turmoil MARKETWATCH April 4, 2025 “Tarrifying”: How Retirees Can Navigate Tariffs, Inflation and Market Volatility THESTREET April 2, 2025 Three Proven Strategies To Maximize Your Tax Savings in 2025 ADVISORPEDIA April 2, 2025 7 Positive Signs for Your 401(k) in 2025 GOBANKINGRATES March 30, 2025 Why Investors May Get ‘Hot-Blooded’ for Foreign Investments THE DAILY UPSIDE* March 27, 2025 Should you ever use a 401(k) loan to pay off debt? Pros, cons and considerations AOL March 21, 2025 5 Best S&P 500 Index Funds to Buy Now U.S. NEWS & WORLD REPORT March 17, 2025 7 Ways to Invest With a Weakening U.S. Dollar U.S. NEWS & WORLD REPORT March 17, 2025 Navigate Economic Downturns: Stability & Growth Tips In A Recession FORBES March 12, 2025 Here’s How Inflation Impacts Your Bank Account (And How To Take Advantage) GOBANKINGRATES March 11, 2025 Tariffs could cost Americans an extra $1,600 a year. Here’s where to find that money in your household budget. MARKETWATCH March 7, 2025 Americans Pay $500K in Taxes Over Their Lifetimes — 9 Ways To Cut the Cost Down GOBANKINGRATES March 6, 2025 4 Worst Mistakes Millennials Can Make With Money — and How To Avoid Them GOBANKINGRATES March 3, 2025 Estate Planning forYoung Families ADVISORPEDIA January 13, 2025 RISE Investments: Formed to Bridge Multi-Generational Wealth Management Gap CITYBIZ

RISE Investments is an independent fiduciary wealth advisor that delivers tailored investment management and financial planning services to our clients. Guided by Integrity, Driven by Your Success. Let's start a conversation Button About RISE Investments We are a fiduciary wealth management firm that delivers tailored investment management and comprehensive financial planning services to our clients. Established in 2019, we are committed to offering highly personalized advice and solutions to help our clients achieve long-term financial security and growth. RISE Investments serves high net worth individuals, families, high earners starting to build wealth, mid-career professionals, and individuals preparing for retirement. Read More Our Services Financial Planning Learn More Investment Management Learn More Tax and Advanced Planning Learn More Why RISE Investments We offer a unique value proposition within the wealth management industry. With nearly two decades of combined industry experience and a future runway measured in several decades, the independent advisory setting allows RISE Investments to grow alongside our clients and bridge the gap between our client's evolving multi-generational financial planning and investments needs and best-in-class solutions to meet those needs. Fiduciary As a fiduciary, we serve as partners to our clients, upholding the highest standard of care and acting solely in our clients' best interest every step of the way. CERTIFIED FINANCIAL PLANNER® For 50 years, the CERTIFIED FINANCIAL PLANNER® certification has been the standard of excellence for financial planners. CFP® professionals must meet extensive training and experience requirements, and commit to CFP® Board's ethical standards that require putting clients' interests first. That's why partnering with a CFP® professional gives clients confidence today and a more secure tomorrow. Only 30% of U.S. financial advisors are CFP® practitioners. Chartered Financial Analyst® Charterholder A Chartered Financial Analyst (CFA®) is a professional who has demonstrated expertise in investment management, financial research, and portfolio management. The CFA® charter is a globally recognized credential that's considered the pinnacle of professional development in investment management. Alignment We believe alignment is one of the best ways to help our clients achieve their financial goals and objectives, and the majority of our team's personal assets are invested alongside our clients' in RISE's investment strategies. Discipline and Integrity With a focus on long-term capital appreciation and tax efficiency, we seek to maximize client outcomes while safeguarding assets, treating each client’s portfolio as a unique entity tailored to their specific financial goals. Our Story Get In Touch

Subscribe to receive our latest insights and articles about financial planning and investing education, concepts, industry news and trends. The RISE Report Subscribe to receive our latest insights and education about financial and estate planning, investing, money concepts, and industry news. First name* Last name* Email* Zip Code* By filling out this form, you consent to receive emails from RISE Investments. For information on our privacy practices, please see our privacy policy . Subscribe