The Taxes and Other Financial Information section allows you to enter tax information and other financial values that exist before the start of the financial plan.
These settings help establish the client's starting tax position so Voyant can accurately model future taxation, deductions, credits, estate planning, and capital loss carryforwards.
Many of these values can be obtained from the client's most recent federal and state tax returns or other tax documentation. If these amounts are not known, they can often be left at their default values, although doing so may affect the accuracy of future tax projections.
Tax Information
These settings determine the tax assumptions used at the beginning of the plan.
State of Residence
Select the client's state of residence.
Voyant uses this setting to determine which state income tax rules apply throughout the financial plan.
Review this setting whenever:
- The client moves to a different state.
The client is expected to relocate during the planning period.
Tip: If your client plans to move during the plan, you can use Steps to change their state of residence in the appropriate future year.
Filing Status
Select the client's federal income tax filing status.
Available options include:
- Married Filing Jointly
- Married Filing Separately
- Single
The selected filing status affects how federal income taxes are calculated throughout the plan.
Review this setting whenever:
- The client's marital status changes.
- The client intends to file under a different tax filing status.
Use Standard Deduction
This setting determines whether the plan uses the federal standard deduction or itemized deductions when calculating taxes.
When enabled, Voyant applies the standard deduction.
When disabled, itemized deductions entered elsewhere in the plan are used where appropriate.
Consider changing this setting if:
- The client consistently itemizes deductions.
- You want to compare the tax impact of standard versus itemized deductions.
- You have a client testing different Estate Tax Reducing strategies like gifting.
Tax Balances
These settings establish tax balances that exist before the plan begins.
Expected Rebate
Enter any tax refund the client expects to receive.
This amount is applied during the first year of the plan, increasing available cash flow.
You may want to enter this value if:
- The client expects a federal or state tax refund shortly after the plan begins.
Taxes Due
Enter any taxes owed at the beginning of the planning period.
This liability is reflected in the first year's cash flow.
You may want to enter this value if:
- The client has an outstanding tax balance.
Estate Exemption Used
Enter the amount of the client's lifetime federal estate and gift tax exemption that has already been used.
Voyant uses this value when determining the exemption remaining for future estate planning calculations.
Estate Exemption Carry Forward
Enter any unused federal estate tax exemption transferred from a deceased spouse.
Voyant uses this value when calculating the total estate tax exemption available to the surviving spouse.
This value is typically used when portability has been elected.
Capital Losses Carry Forward
Enter any unused capital losses available to offset future taxable capital gains.
Voyant applies these losses where appropriate during future tax calculations.
Charitable Cash Donations Carry Forward
Enter any charitable cash donation deductions that remain available for use in future tax years.
Voyant uses these deductions when calculating future income taxes.
Charitable Asset Donations Carry Forward
Enter any charitable donation deductions related to appreciated assets that remain available for future tax years.
Additional Tax Adjustments
These settings allow you to model deductions and credits that exist outside of other plan inputs.
Tax Deduction (+)
Use this field to enter any additional itemized deductions that should reduce taxable income.
Examples may include deductions that are not otherwise represented elsewhere in the financial plan.
Tax Credit (+)
Use this field to enter any additional tax credits that should reduce taxes payable.
Examples may include credits that are not otherwise represented elsewhere in the plan.
Future Tax Changes Using Steps
Many tax assumptions change over time. Rather than creating separate plans, Voyant allows you to schedule future changes using Steps.
You can create future changes for:
- State of residence
- Filing status
- Standard deduction selection
For example, you might use Steps to model:
- A client retiring to another state.
- A change from Married Filing Jointly to Single after the death of a spouse.
- A future decision to use itemized deductions instead of the standard deduction.
Using Steps allows the plan to automatically apply these changes beginning in the year you specify.
Best Practices
The Taxes and Other Financial Information section helps establish the client's starting tax position before future projections begin.
For the most accurate results:
- Confirm the correct filing status and state of residence.
- Enter any available carryforward balances, such as capital losses or charitable deductions.
- Update these values whenever the client's tax records change.
- Use Steps to model future changes rather than manually adjusting values in different plan years.
Accurate tax information at the start of the plan helps improve the accuracy of future tax calculations, estate planning projections, and cash flow analysis.