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I'm your host, James Canole, and this is the podcast dedicated to helping you retire well.

It all starts right here on Ready for Retirement. for retirement.

Hi, everyone and welcome to another episode of Ready for Retirement. I'm your host, James Cannell. Today we're going to be talking about what taxes will look like in the future.

Now, it'd be great if we all had a crystal ball and we knew exactly what they were going to look like. The reality is we don't, but I think there are a few key pieces of

information that we need to be looking at when it comes to what might shape future tax policy.

And the reason for that is this is extremely important for retirees and soon-to-be retirees.

Because from an income standpoint, if your effective tax bracket doubles

in retirement, then what that really means is your income gets cut in half. Now, will your effective

tax bracket really double? Not likely, but the principle remains. The in retirement between the

portfolio you have, your other income sources, you're going to have a fairly fixed income. You're

not going to have the option to just going to work more and earning more. So we need to understand that if you have that set

income amount, what role will taxes play and what could that potentially do to decrease your

income? Because when we know that, we can start to take steps today to proactively get in front

of that. Here are some of the things that we want to think about when thinking about where taxes might be in the future. Number one, we need to

understand the income tax brackets are near historic lows. Now, I don't like paying taxes

any more than the next person does, but the reality is they're a fact of life. And as much as we

don't like paying those taxes today, these taxes, the tax brackets that we have

today, depending upon how you look at it, are near historic lows. So a brief history about income tax

before 1913, there was no federal income tax. The Revenue Act of 1913, it imposed income tax,

and the initial income tax was 1% of income on incomes above $3,000.

Now, there's an additional 6% surcharge for a 7% total tax on incomes more than $500,000,

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