While Jon and I recapped the tax and financial planning effects of the recently passed tax legislation on August 8, we wanted to reiterate a few of them each month. These rule changes take effect in 2026:
- The estate and gift tax limit is now $15 million per person
- Qualified distributions from 529 plans (college funding) now allow up to $20,000 per year to be used for K-12 expenses
- The dependent care FSA limit has increased from $5,000 to $7,500
- The threshold for 1099 reporting has increased from $600 to $2,000
- If you are an educator that uses your own money to pay for supplies, you can now deduct all of the unreimbursed expenses on Schedule A if you itemize your deductions.
According to FactSet, over 80% of companies in the S&P 500 beat their earnings estimates for Q2 2025. Since a key determinant of long-term stock prices is future expected earnings, this high percentage bodes well for the stock market as a whole. (When you buy a stock, you are buying a proportional share of their future earnings).
According to the Washington Post, Energy prices have spiked partially due to the proliferation of data centers (powering the growth of AI?). Interestingly, the cost of electricity in the state of Maine grew faster than all but CA and MA over the past 10 years. However, ME still boasts the 2nd cheapest electrical rates in New England (after Vermont).
Congratulations Evan!
Our own Evan Marquis obtained his CFP certification this past May. Congratulations, Evan!
Taxes and financial planning are complex, but you don’t have to navigate them alone. A financial advisor can help you stay informed about tax law changes, optimize your savings and investments, and avoid costly mistakes. If you need tailored guidance, our team is here to help. Talk to an advisor or call (603) 589-8010 to integrate tax planning into your comprehensive financial strategy.
Disclaimer:
The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. The views expressed in this commentary are subject to change based on market and other conditions. These documents may contain certain statements that may be deemed forward-looking statements. Please note that any such statements are not guarantees of any future performance and actual results or developments may differ materially from those projected. Any projections, market outlooks, or estimates are based upon certain assumptions and should not be construed as indicative of actual events that will occur.
All information has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. There is no representation or warranty as to the current accuracy, reliability or completeness of, nor liability for, decisions based on such information and it should not be relied on as such.
Milestone Financial Planning, LLC (“Milestone”) is a fee-only financial planning firm and registered investment advisor headquartered in Bedford, NH. Registration does not imply a certain level of skill or training. Milestone works with clients on an ongoing, long-term basis, providing financial planning, tax planning, retirement planning, and investment management services. Fees are based on assets under management and may include a financial planning fee. Milestone receives no commissions or referral fees and, as a fiduciary, is required to act in clients’ best interests. Advisory services are offered only where Milestone and its representatives are properly licensed or exempt from licensure. More information, including fees and principal risks, is available in Milestone’s Form ADV Part 2A. For help with your investments or financial planning, contact one of our fee-only advisors.
