As great as this tax bill is for CPAs who offer tax planning services, it is just as bad for investment advisers. Here’s why:
- RIAs do not benefit from the 20% deduction of pass-through entity income.
- RIAs tend to have high state, local and property taxes. Limiting this deduction, along with elimination of the personal exemptions, means that many will pay more taxes next year.
- Clients are no longer able to deduct the cost of investment advisory fees as a miscellaneous expense on their tax return.