EP298: How to Make More Money in Trump’s Second Administration
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Alright, friend—let’s talk taxes. We know, we know… they’re about as exciting as watching paint dry, right?
But here’s the deal: understanding tax law changes can be the difference between thriving in 2025 or getting left behind.
And trust us, we get it.
You might be thinking, “Who the heck are you to talk about this?”
👉 Well, I’m Palmy ➕ Nancy—AKA the Kitti Sisters—and over the last six years, we’ve helped our investors save over $93 million in taxes through our real estate investment firm.
And let me tell you—when you’re saving nearly a hundred million, taxes start looking pretty darn attractive. 😏
So today, we’re breaking down 7 proposed tax law changes that could shake things up in Trump’s second administration—and more importantly, how you can take advantage of them.
Ready? Let’s dive in. ⏬
Proposed Tax Law No. 1: The Cookie Jar Savings 🍪
Imagine this: every time you put 10 cookies into a jar, you get to pull out 2 for free. Sounds like a sweet deal, right?
That’s basically how the Pass-Through Business Deduction works.
Right now, real estate investors can deduct 20% of their qualified business income, saving them a cool $47 billion a year.
But here’s the thing—this deduction is set to expire on December 31, 2025.
Let’s break it down:
Say your 🏢 multifamily property brings in $500,000 in qualified business income. Thanks to Section 199A, you can deduct $100,000 right off the top.
But if Congress doesn’t act? Say goodbye to that deduction in 2025. 😬
The proposed changes?
- Lower income limits (from $364,200 down to $250,000 for single filers)
- Stricter qualifications for Real Estate Investment Trusts (REITs)
Bottom line?
This is a deduction you want to maximize while it lasts.
Proposed Tax Law No. 2: The Treasure Chest Rule 💎
Let’s talk estate planning (don’t zone out yet—this one’s BIG).
Picture a family treasure chest. 👑💎🏺
Right now, you can stash up to $13.99 million in it, and when you pass away, your heirs get it tax-free.
Pretty amazing, right?
Well… if new rules come into play, that chest could shrink to just $6.2 million. 😳
Meaning anything beyond that could get hit with a 40% estate tax.
Let’s put that into perspective: if you have $13 million in assets today, under the new rules, $7 million could be taxed, resulting in a $2.8 million tax bill. Ouch.
And here’s the twist—proposed changes would remove the “stepped-up basis,” meaning your heirs could owe taxes on the full market value of your properties.
This is where planning ahead is key.
Proposed Tax Law No. 3: The Piggy Bank Problem 🐷
You know that feeling when you want to stash your hard-earned money but can only fit so much into your 🐽🏦 piggy bank?
That’s basically the situation with the State and Local Tax (SALT) Deduction Cap.
Right now, real estate investors in high-tax states (looking at you, New York and California) can only deduct $10,000 of their state and local taxes.
Before 2017?
That deduction was UNLIMITED.
Let’s break it down:
Say you own properties in New Jersey with:
- $80,000 in property taxes
- $50,000 in state income taxes
- Total SALT: $130,000
Under the current cap, you can only deduct $10,000, meaning you’re losing out on $120,000 in deductions.
What’s proposed?
- Eliminating the cap entirely (YES, PLEASE 🙌)
- Raising it to $80,000
- Creating special carve-outs for real estate investors
If these changes happen, it could be a total game-changer for your tax bill.
Proposed Tax Law No. 4: The Recycling Game ♻️
If you’re in real estate, depreciation is your best friend. Right now, you can write off properties over:
- 27.5 years for residential rental property
- 39 years for commercial property
And here’s the fun part—bonus depreciation allows you to deduct a big chunk upfront.
The current rate?
60% in 2024, phasing down to 0% by 2027.
The proposed changes aim to:
- Extend 100% bonus depreciation
- Offer more deductions for energy-efficient buildings
- Improve property upgrade incentives
Translation?
Bigger deductions, faster cash flow, and more money in your pocket.
Proposed Tax Law No. 5: The Green Playground Upgrade 🌿
Real estate is going green, and there’s BIG money to be made in sustainability.
Right now, thanks to the Inflation Reduction Act, you can cash in on tax credits for energy-efficient improvements:
- Up to $5 per square foot for upgrades
- Additional credits for solar installations
- Deductions for HVAC, lighting, and insulation improvements
The proposed changes?
- Even bigger tax credits for commercial properties
- New deductions for retrofitting older buildings
- Special incentives for affordable housing
Going green = saving green. Simple as that. ✨
Proposed Tax Law No. 6: The Adventure Map Extension 🗺️
Have you heard about Opportunity Zones? If not, listen up—this program lets you:
- Defer capital gains taxes until 2026
- Enjoy tax-free appreciation after holding for 10 years
- Get major tax benefits on reinvestments
The program expires soon, but proposed changes could:
- Extend it to 2030
- Introduce new reporting requirements
- Tighten eligibility
If you’ve been on the fence about investing in Opportunity Zones, now might be the time to make your move.
Proposed Tax Law No. 7: The Global Payback Plan 🌎
Trump’s new proposal?
The External Revenue Service (ERS), which aims to collect taxes on foreign income and trade.
This could impact:
- Foreign investors entering the US market
- Supply chain costs for construction
- Compliance requirements for property owners
If you’re investing internationally, you’ll want to watch this one closely.
So, What’s Next? Here’s How to Prepare for 2025
These tax changes aren’t just minor tweaks—they could completely reshape real estate investing.
Here’s what you should be doing right now:
- Review your estate plan (if your portfolio is over $6M, start planning ASAP).
- Optimize your entity structure to maximize tax benefits.
- Position your portfolio to take advantage of energy incentives and Opportunity Zones.
And most importantly?
Stay ahead of the game. 🙌
Because knowing how to play by the rules means keeping more of your hard-earned money.
If you’re interested in making more money, watch the next video—‘How Taxes Make Earning $100,000 Feel Poor.’
We’ll break down why how you earn your income matters more than how much you earn—and what you can do about it.
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