2025 Tax Law Proposals: A Call to Action for CFP® Professionals and Candidates
CFP® Board In The News
The landscape of tax policy is once again shifting—and the implications for retirement and estate planning are profound. As CFP® professionals and those preparing for the designation, it’s our responsibility not only to stay ahead of these changes but to help our clients do the same.
The CFP Board has issued an important update outlining several proposed tax law changes that could significantly disrupt long-standing planning strategies. While these proposals are not yet finalized, the potential impact on wealth transfer, retirement income planning, and trust strategies warrants immediate attention.
Key Provisions to Watch
Here are several proposed changes that may reshape the advisory conversations you’re having—or should be having—with clients:
- Estate and Gift Tax Exemptions Could Be Significantly Reduced
The enhanced exemption amounts introduced by the 2017 Tax Cuts and Jobs Act are scheduled to sunset in 2026, but lawmakers may accelerate that timeline. A drop from over $13 million to roughly $7 million (or potentially lower) per individual would pull many clients back into taxable territory and trigger a need for revised gifting and legacy strategies. - Shifting Income and Capital Gains Brackets
Proposed changes could affect how retirement distributions, capital gains, and investment income are taxed—particularly for high-income earners. This may influence Roth conversion timing, withdrawal sequencing, and asset location strategies. - Potential Adjustments to Trust Taxation and Grantor Rules
For clients utilizing irrevocable trusts or grantor trust arrangements, changes could limit key benefits or impose new tax burdens. Staying informed will be essential for protecting these structures and their intended outcomes.
The Takeaway for Financial Professionals
Whether you’re actively advising clients or currently pursuing your CFP® certification, this is a moment to sharpen your knowledge, update your planning frameworks, and deepen your client conversations.
We must go beyond reactive planning—this is an opportunity to lead. Encourage clients to revisit their estate plans, review gifting strategies, and model the impact of these proposed changes on their financial goals. Staying proactive now could mitigate major tax consequences later.
For a comprehensive breakdown and policy analysis, read the CFP Board’s full article here:
2025 Tax Changes Could Upend Retirement and Legacy Plans
(https://www.cfp.net/news/2025/03/2025-tax-changes-could-upend-retirement-and-legacy-plans)
