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Financial Planning > Tax Planning

AICPA Issues Updated Tax Guide for CPA Financial Planners

By Melanie Waddell

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The American Institute of Certified Public Accountants released Tuesday an updated Personal Financial Planning Body of Knowledge to help CPA financial planners keep pace with the expected overhaul of the tax code this year by Congress and the incoming Trump administration.  

The BOK is designed to not only benchmark best practices of CPA financial planning services but will also help to update the next version of the AICPA’s Personal Financial Specialist credential exam, which will be released in July.

CPAs that also provide financial planning services are “best positioned to help their clients navigate the uncertainty that any potential changes to the tax code will bring,” said Susan Coffey, executive vice president of public practice at AICPA. “Americans should meet with their CPA financial planners to begin discussing the potential impacts that changes to the tax code will have on all aspects of their financial plans including their retirement, investment and estate plans.”

Andy Friedman of the Washington Update, a former tax attorney, told ThinkAdvisor on Tuesday that he sees the Republican-controlled Congress addressing individual and corporate tax reform together. “The starting point will be the tax reform ‘blueprint’ put out by the House Republicans last April, which addressed both individual and corporate reform,” he said. “When there was a split in Washington power (Democratic White House and Republican Congress), I felt that the parties would work first on corporate reform, where there is general agreement about the need to lower the tax rate and less concern about the blowback from curtailing individual deductions.”

The new PFP Body of Knowledge highlights and clarifies a number of areas that AICPA says are growing in importance in the financial planning realm:  

  • Elder, Special Needs and Chronic Illness Planning.  As the U.S. population continues to age, CPA financial planners increasingly find themselves addressing diminished capacity issues.
  • Closely held Business Planning. The area has been revamped to more thoroughly address compensation and benefits for employees, as well as the potential impact of the business decisions upon the owner’s personal financial situation.
  • Education Planning. With higher education continuing to grow more expensive and an increased awareness of the long-term financial impact of student loans, this area is crucial for CPA financial planners to understand.  
  • Client Relationship Building. Covers essential topics such as the importance of effective client communication, handling conflict, understanding and diagnosing client situations and the impact of family dynamics.

— Check out 7 Steps Wealthy Are Taking to Reap Trump’s Tax Bonanza on ThinkAdvisor.

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