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Healthcare Provider Update: FedEx's healthcare provider is primarily Cigna, which partners with the company to offer health insurance solutions to its employees through a range of plans, including High Deductible Health Plans paired with Health Savings Accounts. In 2026, FedEx employees may face significant healthcare cost increases, mirroring a broader trend across the nation. With the expected elimination of enhanced ACA premium subsidies, some workers could see their out-of-pocket premium costs surge by over 75%. Coupled with the anticipated double-digit rate hikes from major insurers and rising medical expenses, the financial burden on employees is poised to escalate sharply, potentially impacting their overall healthcare affordability. Click here to learn more
“Recent changes to the SALT deduction are prompting many FedEx employees to revisit long-standing assumptions about itemizing, refunds, and cash flow in retirement, making it important to periodically reassess how evolving tax rules may influence overall planning decisions,” – Michael Corgiat, a representative of The Retirement Group, a division of Wealth Enhancement.
“Expanded SALT deduction limits are creating renewed planning considerations for FedEx employees approaching retirement, particularly those in higher tax states who may benefit from reexamining itemized deductions as part of a broader, multi-year tax strategy,” – Brent Wolf, a representative of The Retirement Group, a division of Wealth Enhancement.
In this article, we will discuss:
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How recent changes to the state and local tax (SALT) deduction may influence tax outcomes for retirees, particularly those in higher tax states.
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Why itemizing deductions may once again be relevant for certain FedEx employees approaching or entering retirement.
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How the enhanced SALT deduction can create planning opportunities that affect refunds, cash flow, and long-term tax results.
By Neva Bradley, CFP®, Wealth Enhancement
For many retirees—especially those living in high tax states—recent changes to the state and local tax (SALT) deduction may exert a quiet impact on tax results. One provision—the enhanced SALT deduction—may lead to larger refunds or smaller tax bills than expected, which could work to the benefit of FedEx employees nearing retirement.
In 2025, the annual limit on the SALT deduction rose from $10,000 to $40,000 per household (and will increase slightly through 2029). 1 This change may allow eligible taxpayers who choose to itemize to claim up to $40,000 in qualifying state and local tax payments, subject to income-based phase-out rules.
This adjustment does not apply to everyone, but for the right retiree profile, it can have a meaningful impact—especially for individuals transitioning out of long corporate careers and reassessing their taxes.
What Is Included in the SALT Deduction
Under current tax law, taxpayers who itemize can deduct the following, up to the annual limit:
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- Property tax payments
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- Either state and local income taxes or state and local sales taxes (not both) 2
In recent years, this deduction has been capped at a relatively low level, which limited its usefulness for retirees in states with higher income or property taxes.
Why the Higher SALT Limit Matters
The higher SALT limit increases the amount of state and local taxes that may be deducted for qualifying filers. For FedEx retirees who:
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- Own higher-value homes
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- Live in states with elevated income tax rates
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- Have finished paying off their mortgages but still face substantial property tax bills
this modification may reduce taxable income in ways that can affect your overall tax results.
In practice, that reduction may:
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- Lower overall federal tax liability
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- Result in larger refunds for those whose payments exceeded what was owed
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- Improve periodic cash flow throughout retirement
Itemizing Is the Key
To receive the benefit of the SALT deduction, retirees must choose to itemize deductions rather than claim the standard deduction. While many taxpayers default to the standard deduction, the higher SALT limit means that itemizing may once again be preferable for certain households, including some FedEx employees with complex tax situations.
This is especially true when SALT deductions are combined with:
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- Charitable contributions
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- Significant medical expenses
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- Other allowable itemized deductions
When these deductions are combined thoughtfully, itemizing may exceed the standard deduction and provide a more favorable result.
Who Is Most Likely to See Value from This Change
Based on broader trends, taxpayers most likely to benefit share several characteristics:
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- Residence in higher-tax states
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- Meaningful exposure to property tax burdens
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- Household income below the phase-out levels for the enhanced SALT limit
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- A willingness to revisit deductions each year instead of relying on prior returns
Why Refunds Are Appearing Now
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Many retirees made estimated tax payments or had withholdings based on prior-year tax scenarios. When allowable deductions increase or eligibility shifts, those prior payments may exceed what is ultimately owed, leading to larger refunds during tax filing. This helps explain why some FedEx retirees saw unexpected upsides during the most recent tax season.
Extended Planning Opportunities
Beyond the current tax year, the expanded SALT deduction also offers longer-term planning possibilities. SALT considerations can be coordinated with:
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- Timing of capital gains
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- Roth conversion timing
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- Charitable giving strategies
When these elements are synchronized effectively, they may improve tax results across multiple years for FedEx retirees.
The Bottom Line
For retirees living in higher-tax areas, the expanded SALT deduction limit may be one of the more notable tax changes in recent years. It has the potential to reduce taxes due, increase refunds, and restore the value of itemized deductions that many assumed were no longer beneficial under prior law.
That said, the benefit depends on detailed analysis—not assumptions.
The Retirement Group Can Help
If you are retired or nearing retirement and live in a state with higher income or property taxes, this could be a good time to revisit whether itemizing and the expanded SALT deduction align with your overall tax plan. The Retirement Group can help review how this change fits into your broader tax and retirement considerations. To learn more, call (800) 900-5867.
Sources:
1. Hernandez, Fredrick. “ SALT Deduction Changes in the One Big Beautiful Bill Act .” Bipartisan Policy Center , 30 July 2025.
2. Congressional Research Service. Tax Provisions in P.L. 119-21, the FY2025 Reconciliation Law. 29 July 2025, CRS Report R48611, crsreports.congress.gov/product/pdf/R/R48611.
What are the implications of the Funding Target Attainment Percentage for FedEx Corporation employees, and how does it impact the security of the pension benefits offered by FedEx Corporation? This question seeks to explore the nuances of the funding target attainment percentage as reported in the annual funding notice, examining how this metric not only reflects the financial health of FedEx Corporation's pension plan but also how it affects employee confidence in future benefit payments and retirement planning.
Funding Target Attainment Percentage: The Funding Target Attainment Percentage for FedEx Corporation indicates the degree to which the pension plan is funded. A percentage of 101.33% for 2022 suggests that the plan has sufficient assets to cover its liabilities, providing security for employees' pension benefits. This high percentage likely increases employee confidence in the stability and reliability of their future pension payouts, essential for long-term retirement planning.
How does the merger of the FedEx Freight Pension Plan into the FedEx Corporate Employees’ Pension Plan influence the benefits currently available to FedEx Corporation employees? This question aims to delve into the practical changes that may arise due to this merger, assessing whether it aligns with employee expectations regarding their pension benefits and how the transition process is managed by FedEx Corporation.
Merger of Pension Plans: The merger of the FedEx Freight Pension Plan into the FedEx Corporate Employees’ Pension Plan appears to have been strategically managed to maintain benefit stability. Despite increasing liabilities by 5.3%, the merger was structured to ensure no negative impact on the benefit amounts payable to participants from either plan, preserving the expected pension benefits for all affected FedEx Corporation employees.
In terms of investment strategies, what measures does FedEx Corporation implement to ensure that its pension plan investments align with the long-term liabilities expected to be paid out to retirees? This question encourages an exploration of the investment policies in place, examining the asset allocations and risk management strategies that FedEx Corporation employs to ensure sustainable funding for its pension obligations, which could potentially include detailed analyses of stocks, debts, and alternative investments.
Investment Strategies: FedEx Corporation employs a diversified investment strategy across equities, fixed income, and alternative investments, aiming to meet long-term pension liabilities. This approach, which includes both active management strategies and the limited use of derivatives, is designed to generate returns that exceed market indices, thus ensuring adequate funding of pension obligations.
What options do employees of FedEx Corporation have for accessing their pension plan statements, and how frequently are these statements generated? The focus here is to understand the communication strategies employed by FedEx Corporation regarding pension benefit statements, including technological access points and the importance of these documents for employee financial planning.
Pension Plan Statements: FedEx Corporation provides annual pension plan statements through their Retirement Service Center, available electronically each fall. Employees can access their statements online or request them if notifications are not received, ensuring transparency and aiding in personal financial planning.
How are contributions to the FedEx Corporation Employees’ Pension Plan determined, and what role do excess contributions play in the plan's overall funding strategy? This question aims to educate employees about how the company balances mandatory contribution levels with potential excess contributions, exploring how these factors interact to influence the plan's solvency and employee benefits.
Contributions to the Pension Plan: Contributions to the FedEx Corporation Employees' Pension Plan are calculated to meet at least the minimum legal requirement and potentially include voluntary excess contributions. These excess contributions can help manage the plan's funding level and ensure its solvency, benefiting overall pension security for employees.
What types of benefits are guaranteed under the Pension Benefit Guaranty Corporation (PBGC) for FedEx Corporation employees, and what limitations exist that employees should be aware of? By focusing on the guaranteed benefits, this question prompts a discussion on the security of specific benefits provided by FedEx Corporation and highlights limitations, allowing employees to understand their rights fully.
PBGC Guarantee: The Pension Benefit Guaranty Corporation guarantees certain types of benefits for FedEx Corporation employees, such as pension benefits at normal retirement age and most early retirement benefits. However, there are limitations, such as exclusions for benefits without vested rights and recently increased benefits, which employees should be aware of to fully understand their pension security.
In what ways does the FedEx Corporation plan to adjust its pension funding strategy in light of changing federal laws that impact pension obligations? Employees are encouraged to consider how legislative changes influence corporate policies surrounding retirement benefits and the proactive strategies FedEx Corporation might take to remain compliant while ensuring the security of employee pensions.
Adjustments to Funding Strategy: FedEx Corporation is likely to adjust its pension funding strategy in response to legislative changes affecting pension obligations, such as those introduced by recent acts adjusting how pension liabilities are calculated. This proactive approach aims to ensure compliance with new laws while continuing to secure the financial health of the pension plan.
What are the steps that FedEx Corporation employees must take if they are considering retirement, particularly in how to navigate the pension plan and gain access to their benefits? This question aims to provide clarity on the retirement process, ensuring that employees are equipped with the necessary information regarding required documentation, timelines, and points of contact within FedEx Corporation.
Steps for Retirement Planning: Employees considering retirement should contact the FedEx Retirement Service Center to navigate their pension plan benefits. This process involves understanding necessary documentation, timelines, and available support, facilitating a smooth transition into retirement.
How does FedEx Corporation plan to manage potential funding shortfalls in the pension plan, and what mechanisms are in place for notifying plan participants should such an event occur? Employees would need to understand the proactive measures put in place by FedEx Corporation to address funding-related challenges while also knowing what this means for their benefits.
Managing Funding Shortfalls: In the event of potential funding shortfalls, FedEx Corporation has policies in place to manage such situations, including strategic contributions to mitigate shortfalls. The company maintains transparency with plan participants about funding levels and any significant changes affecting the pension plan.
For those seeking more information about their pensions and retirement options, how can FedEx Corporation employees contact relevant departments, and what resources are available for assistance? This question provides an opportunity for employees to familiarize themselves with contact points such as the FedEx Retirement Service Center, emphasizing the importance of open communication channels for addressing inquiries related to their pensions. Feel free to consult the provided document for more in-depth exploration of these topics.
Contacting for Pension Information: FedEx Corporation employees seeking more information about their pensions or retirement options can contact the FedEx Retirement Service Center. This center provides essential resources and support, ensuring employees have access to all necessary information regarding their retirement planning.
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