It’s January and we’re well into the season of new tax laws. In Utah, 2022 will bring tax changes that could positively or negatively impact your personal finances and retirement plans. Don’t get caught unprepared. A Certified Financial Planner in Utah aligned with a continuous tax planning service could minimize your tax burden at both the state and federal levels, protecting your assets. Think of it as a well-coordinated wealth preservation plan!
Here’s a brief review of the new tax scenarios:
Tax Changes In Utah That Could Impact You in 2022
There’s very good news for Social Security benefit recipients. Social Security benefits are now exempt from Utah tax up to a total of $50,000 if recipients file jointly. Only $35,000 was exempt from taxes previously. This means that many Utahans will not have their Social Security taxed at the state level at all.
Collectively, that means an $18 million tax cut for retirees receiving Social Security benefits in the state.
There’s also very good news for military retirees. Your military retirement benefits will no longer be taxed at all in Utah. This puts Utah firmly in the majority of U.S. states, making the Beehive State the forty-seventh state to eliminate taxes on military retiree benefits at the state level.
Across Utah, that’s a $24 million tax cut, collectively.
If you have dependents, the state tax exemption for dependents was raised to $1,750 (per person) from $565, restoration of earlier levels. That’s a collective tax cut across the state of $54 million.
Small business owners also received a tax cut. The exemption on small business personal property was raised to $25,000 from $15,000. Individual items that cost less than $500 and are not considered critical to business activity are also exempt. The Utah Taxpayers Association estimates that this will provide a tax cut to more than half of Utah small businesses.
Do you have questions about your Utah and Federal taxes? Schedule a no-obligation conversation with the Rock House Financial team in Utah to start the discussion.
Taxation at the local and federal levels affects your financial and retirement plans in challenging and complex ways. Recent and upcoming tax changes are likely to impact you. Talk to a financial advisor aligned with a tax professional in Utah who understands the local scene as well as the federal, and can formulate a comprehensive financial plan for you and your family.
If you’re looking for a financial advisor in Utah or are ready to get a second opinion about advanced tax strategies, schedule a no-obligation conversation with our team.