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Are Equifax Employees Prepared for Potential Tax Changes Ahead?

Healthcare Provider Update: Healthcare Provider for Equifax: Equifax collaborates with various healthcare providers and partners, primarily offering solutions that utilize their comprehensive data and analytics services to enhance healthcare delivery and patient experiences. They focus on improving patient outcomes by leveraging insights gathered from their expansive databases, facilitating better decision-making for healthcare organizations. Potential Healthcare Cost Increases in 2026: As we approach 2026, significant increases in healthcare costs are anticipated, primarily driven by the looming expiration of enhanced ACA premium subsidies. Without these critical financial supports, patients could face out-of-pocket premium increases exceeding 75%, effectively pricing many out of necessary coverage. Coupled with escalating medical service costs and a sharp rise in insurer demand for rate adjustments, particularly in states like New York where proposed hikes reach as high as 66.4%, the burden on consumers will intensify, prompting an urgent need for strategic healthcare planning. Click here to learn more

As the environment changes with the coming end of the Tax Cuts and Jobs Act, Equifax employees must navigate these changes strategically,' says Brent Wolf of The Retirement Group, a division of Wealth Enhancement Group. 'It is therefore important to consider Roth conversions, tax-loss harvesting, and estate planning in order to maintain financial health in the changing tax environment.'

The author of this paper agrees that Equifax employees who are likely to be affected by the possible change in tax laws should make it a point to meet their financial advisors to see how they can be best prepared for the future,' suggests Kevin Landis from The Retirement Group, a division of Wealth Enhancement Group. 'Some of the strategies that may be useful in the current environment and which may become particularly valuable as the tax laws change include Roth conversions and tax-loss harvesting.'

In this article we will discuss:

The effects that the upcoming 2024 elections may have on Equifax employees in relation to the Tax Cuts and Jobs Act.
Strategic financial moves such as Roth conversions, tax-loss harvesting, and gifting to minimize tax exposures in wait of possible tax reforms.
The role of personal financial planning in the context of potential legislative modifications and their implications for retirement planning.

As the 2024 elections draw near, Equifax employees need to know that there are certain changes that may happen in the financial system. The Tax Cuts and Jobs Act (TCJA) passed in 2017 and will expire at the end of 2025 is still a debate now. This legislation made a lot of changes to the tax code through increasing the standard deduction, reducing the top tax rate, expanding tax brackets, and restricting the deduction of state and local taxes (SALT) and mortgage interest. It also raised the federal gift and estate tax exemption thresholds.

During the campaign, President Biden has indicated that many of the cuts implemented by the TCJA should not be extended when they expire. On the other hand, former President Trump has proposed to continue some of the provisions of the act, the details of which are still under negotiation. This is because Congress will have a major say in the decisions that will be made.

Equifax employees who are thinking about tax strategies may want to consider the following strategies in light of possible higher taxes:

Conversions to Roth:

Moving your 401(k) or IRA to a Roth 401(k) or Roth IRA may be advantageous if you anticipate higher taxes. This move allows for tax-free growth and distributions, controlling taxes in case of higher future taxes. Unlike other Roth conversions, the “backdoor” Roth entails contributing nondeductible amounts to a traditional IRA and then converting to a Roth IRA.

Tax Losses:

If you expect to pay more in capital gains taxes, you can sell losing investments and replace them with like investments to offset gains and thus reduce your taxes. The balance can be used to reduce taxable income up to $3,000 each year, any remaining loss being carried forward.

Gifting and Estate Planning:

The limits of estate taxes are expected to drop greatly in 2024, thus gifting becomes more important. With the annual gift tax exemption being increased to $18,000, there are now ways to decrease the value of the estate and gift it without incurring any tax. It is crucial to document everything, particularly if the gift is larger than the stated limit.

Qualified Longevity Annuities (QLACs):

QLACs are perfect for deferring income up to the age of 85 that may help to address potential future higher tax brackets. Qualified retirement plans include those that fund the QLAC, which defers taxation until distributions are made and are not reportable as required minimum distributions, with a limitation of $200,000.

In this context, it is crucial for the Equifax employees to get ready for the possible changes in the tax laws. Some of the current strategies include Roth conversions, tax-loss harvesting, and strategic gifting, which are very useful based on the current laws. This is because the situation is different for every single Equifax employee, and therefore the advice of a tax or financial expert is crucial as we head into the election season.

The Secure Act 2.0, which took effect in December 2022, also affects those near retirement age. This act increased the age of RMDs from retirement accounts, allowing for more tax deferred growth and possibly assistance in managing taxes in higher brackets. Review tactical financial planning in light of the impending sunset of the 2017 Tax Cuts and Jobs Act.

The opportunities that can be explored based on the understanding of Roth conversions, tax-loss harvesting, estate planning, and the benefits of Qualified Longevity Annuity Contracts (QLACs) are encountered in an attempt to maximize your retirement funds in light of potential tax increases. It is advisable to stay informed and proactive to protect your financial position as the 2024 elections may impact healthcare, taxes, and the overall economy.

IRA traditional account owners should consider certain pros and cons of converting their accounts to Roth IRA. The major ones include paying taxes on the amount being converted at the time of conversion, the rules on withdrawals from a Roth IRA, and the age and annual contribution limits on contributing to a Roth IRA. For instance, if you are required to take a RMD in the year that you convert, you must take it before converting to a Roth IRA. The following is an investment risk statement:

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Sources:

1. Investopedia: 'What Is the Tax Cuts and Jobs Act (TCJA)?' Investopedia, www.investopedia.com . Accessed 4 Feb. 2025.

2. Thrivent: 'TCJA Set to Expire: Tax Moves to Consider if You're Nearing or in Retirement.' Thrivent, 20 Feb. 2024, www.thrivent.com . Accessed 4 Feb. 2025.

3. Pacific Life Annuities: 'Tax Cuts and Jobs Act Sunset Provisions after 2025.' Pacific Life Annuities, www.annuities.pacificlife.com . Accessed 4 Feb. 2025.

4. J.P. Morgan Asset Management: Conrath, Michael, and Steve Rubino. '2024 Guide to Retirement.' J.P. Morgan Asset Management, 6 Mar. 2024, am.jpmorgan.com.

5. Waverly Advisors: 'Preparing for the Expiration of the Tax Cuts and Jobs Act (TCJA).' Waverly Advisors, waverly-advisors.com. Accessed 4 Feb. 2025.

What type of retirement savings plan does Equifax offer to its employees?

Equifax offers a 401(k) retirement savings plan to help employees save for retirement.

How can employees at Equifax enroll in the 401(k) plan?

Employees at Equifax can enroll in the 401(k) plan through the company's benefits portal during the enrollment period or after they meet eligibility requirements.

Does Equifax provide any matching contributions to the 401(k) plan?

Yes, Equifax offers a matching contribution to the 401(k) plan, which helps employees boost their retirement savings.

What is the vesting schedule for matching contributions at Equifax?

The vesting schedule for matching contributions at Equifax typically follows a graded vesting formula, allowing employees to gradually gain ownership of the contributions over time.

Can employees at Equifax take loans against their 401(k) savings?

Yes, Equifax allows employees to take loans against their 401(k) savings, subject to certain conditions and limits.

What investment options are available in Equifax's 401(k) plan?

Equifax's 401(k) plan offers a variety of investment options, including mutual funds, target-date funds, and other investment vehicles to suit different risk tolerances.

How often can employees at Equifax change their 401(k) contribution amounts?

Employees at Equifax can change their 401(k) contribution amounts at any time, subject to the plan's guidelines.

Is there an automatic enrollment feature in Equifax's 401(k) plan?

Yes, Equifax has an automatic enrollment feature that enrolls eligible employees in the 401(k) plan unless they choose to opt out.

What is the minimum contribution percentage for Equifax's 401(k) plan?

The minimum contribution percentage for Equifax's 401(k) plan may vary, but typically it starts at 1% of the employee's eligible pay.

Are there any fees associated with Equifax's 401(k) plan?

Yes, there may be fees associated with Equifax's 401(k) plan, such as administrative fees or investment fees, which are disclosed in the plan documents.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Equifax, as part of its employee benefits structure, offers both a pension plan and a 401(k) plan. In 2009, Equifax froze its defined benefit pension plan for many of its employees. This freeze impacted approximately 4,000 U.S. employees, though about 300 employees who met certain grandfathering criteria continued to participate in the pension plan. The defined benefit pension plan remains active for these grandfathered employees, while the remainder of the workforce transitioned to an enhanced 401(k) plan. Equifax's pension plan had over $606 million in assets as of 2007 (Workforce.com) (Equifax Inc.). For the employees transitioned to the enhanced 401(k) plan, Equifax introduced automatic contributions ranging from 1.5% to 4% of salary based on years of service. This contribution is made regardless of employee participation. Additionally, Equifax provides a 100% match on employee contributions up to 4% of pay. The company also offers investment options to maximize retirement benefits through its 401(k) plan

Restructuring and Layoffs: In early 2024, Equifax announced a strategic restructuring plan aimed at streamlining operations and improving efficiency. This move included a reduction in the workforce, affecting approximately 10% of its employees globally. The restructuring is part of a broader initiative to focus on core areas and reduce operational costs. Importance: It is crucial to monitor these developments due to the current economic climate, which is characterized by increased volatility and changing investment conditions. Companies are adjusting their strategies to stay competitive, and understanding these changes can provide insights into broader market trends and potential impacts on investment and tax strategies.

Equifax (EFX) offers stock options as part of its employee compensation packages. Employees at Equifax are granted stock options to align their interests with those of the company's shareholders. Stock options at Equifax generally vest over a period of time, encouraging long-term employment. Specific details on the vesting schedule and eligibility can be found in Equifax’s employee handbook or compensation plan documents. As of 2022-2024, Equifax has periodically updated its stock option plans to stay competitive and reward high-performing employees. Restricted Stock Units (RSUs): Equifax (EFX) provides Restricted Stock Units (RSUs) to employees, which are typically used to retain talent and incentivize performance. RSUs at Equifax vest based on time or performance metrics. RSUs at Equifax are usually granted to senior executives and high-performing employees. The vesting schedule for RSUs is detailed in Equifax's equity compensation plan. For the years 2022, 2023, and 2024, Equifax has adjusted its RSU grants to align with market trends and company performance goals.

Health Benefits Overview (2023): Equifax provides a range of health benefits including medical, dental, and vision coverage. They offer both HMO and PPO plans, with some plans featuring Health Savings Accounts (HSAs) or Flexible Spending Accounts (FSAs). Acronyms: HMO (Health Maintenance Organization), PPO (Preferred Provider Organization), HSA (Health Savings Account), FSA (Flexible Spending Account). Recent Updates: As of 2023, Equifax has continued to enhance its health benefits offerings, focusing on mental health support and expanding telemedicine services. They also introduced new wellness programs aimed at improving overall employee health and well-being.