Brandy Maben, Director at Windrock Wealth Management, joins Maggie Lake to unpack what’s buried in the new 1,000+ page ’One Big Beautiful Bill’, and why even middle-class investors and small business owners should be alarmed.
From forced IRA distributions and new Roth IRA restrictions to the elimination of grantor trusts and a possible halving of the estate tax exemption, the proposals could cost Americans millions. Even Roth IRAs could face Required Minimum Distributions (RMDs) for the first time ever.
Brandy also explains how Opportunity Zones could offer rare tax relief, but only if you act fast, before the 2026–2027 gap and tighter rules arrive.
What you’ll learn:
- Who is affected by the proposed tax hikes (hint: it’s not just the ultra-wealthy)
- The retirement and estate tools that may soon disappear
- What to know about inherited IRAs, Roth conversion limits, and trust changes
- How to use Opportunity Zones to legally avoid capital gains taxes
- Why timing is critical, and what to do before your options vanish
Volatility got you concerned? Get a free portfolio review with WindRock’s Brandy Maben at: https://bit.ly/4kWnoeK
Hard Assets Alliance – The Best Way to Invest in Gold and Silver: https://www.hardassetsalliance.com/?aff=WTH
Brandy Maben 0:00
The main objective is to start taxing tax free money, make sure that the government gets what they feel like is rightfully theirs.
Maggie Lake 0:13
Hello everyone. Welcome to wealthion. I’m Maggie Lake, and today, Brandi Malvin, Director at Winrock wealth management, is here to talk about how the big, beautiful budget bill might impact your investments. Hey, Brandy, it’s great to see you again. Hi. Good to see you too. So I don’t envy your job right now, because that budget bill making its way through Congress is massive. It’s like more than 1000 pages long. There’s a ton of stuff in there. It’s still being debated, but there are a lot of potential changes investors need to be aware of. So let’s walk through a couple of areas that I know you’re focused on with your clients. And let’s start with retirement accounts. What’s being proposed? What do we need to know?
Brandy Maben 0:55
Well, there’s a lot of changes that are being proposed and have been on previous bills as well. So it’s not to say that they won’t be wiped clean and everything will stay the same, but the main objective is to start taxing tax free money make sure that the government gets what they feel like is rightfully theirs, and unfortunately, some of our strategic planning could be impacted by that. So we’re trying to make sure that especially high net worth clients are being proactive if it goes certain directions that are still advantageous for tax free money. So one of the things like IRAs, if anyone has an IRA with over $10 million in it, they may be forced to take distributions that’s in a traditional raw IRA or a Roth IRA. So we have multiple clients with 15 million or more that have really planned on that being a Legacy Fund and taking minimal draws from it or using it as charity, charitable distributions, especially if they’re not of RMD age, and we’re going to start to make plans on what to do with that money so that it’s not hitting their tax bracket in a way that we don’t want it to in their retirement ages that we we planned accordingly in a different way, if you
Maggie Lake 2:15
will. Yeah, and I like two things you said about that, because, first of all, you’re right. Like it, they’re they’re looking at all it’s going to be debated. Everyone’s pulling and pushing. Everybody wants certain things in and that’s all part of the horse trading negotiation. But the bigger umbrella is that the government, the deficits are growing. They need tax revenue. They’re looking for tax revenue. So I think that’s really important, because it’s sort of like the details may change, but overall, this is something that that everyone needs to be worried about. So I think that’s a really good way to look at it, and a good reason to be proactive. So force distributions, which is so interesting, because that’s really the first time we’ve heard about that. Is it possible that it’s going to impact people lower down the food chain two, or is this something that, if you’re in that threshold, that of of something with, you know, 10 million or over 10 million sitting in an IRA or a Roth, that that is, that’s the focus. Do? Does anybody else have to worry about it too?
Brandy Maben 3:16
That’s just one of the areas. Another high net worth concern is they right now there’s no income cap on Roth conversion planning. So if you make a million dollars a year, you can trickle your IRA into a Roth strategically, year by year over a 10 year period. Now there’s going to be proposed a $400,000 income limit cap on that. So if you make $400,000 or more, you won’t even be able to participate in the conversion at all. Which then brings up other strategies we have, and there’s been insurance policies that can convert things to Roth. You can start to fund executive bonus plans in a Roth way. So there are different strategies we entertain with clients if that is to come to fruition. But that’s another high net worth thing to plan around. Now you asked, Does it affect anyone else below high net worth? It does, and mainly in an inheritance sense. So they’re thinking of risk kind of tightening and constraining the 10 year rule. That’s where, if you inherit an IRA, you have to withdraw it within a 10 year time frame. They’re thinking of shrinking that time frame or making it tiered so that you have to take money out sooner, which, if you’re inheriting this as a spouse could really affect you, because you used to be able to inherit and turn it into your IRA at your own age, they could take that away very easily and make the spouse that is still living immediately take it within 10 years, not only affecting your legacy plan, but affecting your income. Some levels as as a single unit in your household? Yeah,
Maggie Lake 5:06
absolutely. That’s a really big change in all of this. It sounds like, again, to your broader point, it’s it’s getting that money back into the system and taxable, right? It’s all of the ways that you look to sort of prolong it and protect it and shield it. That’s all on the table now as part of these conversations, another thing I know people use a lot is trust. I think you mentioned that really briefly. Is that up for discussion at all? Are they thinking about changing the rules to establishing trust as well?
Brandy Maben 5:33
They are so trusts have always been a strategic play for high net worth earners and making sure that you’re using irrevocable trusts to transfer future asset appreciation to beneficiaries with little to no gift tax, and those are being proposed to be completely wiped and unavailable. The good thing is, if you do it before this bill goes through, it’s very likely you’ll be grandfathered into those perks. So we we made a graph up showing anyone from the 1980s that maybe established a business and went through that business and IT appreciated, if they were strategic, and put it in one of these grantor trusts, their level of gift tax is really protected, even though it appreciates maybe five times its worth, your heirs are really going to benefit from a trust like this. Now, if that changes, these grantor trusts are not effective anymore, and the government is now collecting major dollars. An example would be if your estate’s $30 million in your estate and you previously owed $0 because you structured it appropriately, you’re now looking at owing about $9 million if the exemption levels are halved. If you
Maggie Lake 6:52
have any questions about how to navigate the current environment, wealthion can help connect you with a vetted advisor to get a free portfolio review, just click the link in the description below, or head to wealthion.com/free there’s no obligation, and it will just take a few minutes of your time again. That’s wealthion.com/free thanks so much for joining us. We’ll see you again next time. So you so so I we’ve sort of segwayed. I think it from from just retirement, some of those sort of Roth and retirement related issues to now into this broader estate planning. And I think something that’s really interesting is, I think a lot of times people listen to this and say, Well, you know, that’s for, like, the the Uber, Uber wealthy people, and it doesn’t really impact me. But that’s not really true, especially, you know, when you’re talking about things like trust. I mean, a lot of us have made wills, and you may have assets that you’re not thinking about. It’s not just your straight salary, right? It’s all of your holdings. And in if you take that as a whole, a lot more people might be falling into categories that are affected by this that you don’t realize. And so business owners, it’s so interesting. You mentioned that because you know, we know that there are a lot of small to medium sized businesses, family owned businesses, that sound like they could be wrapped up in this, especially when you’re talking about a generational change.
Brandy Maben 8:11
Absolutely and valuations of businesses might have a whole different outlook now that the tariffs are in place and people are bringing work in house more. So you never know what business values are going to be, and if it could be a million today, it’s easily 6 million in 15 years. And right now, with the exemption levels being at 13.6 1 million, they’re thinking of cutting that in half to six or $7 million a lot more people fall into the range of six to 7 million at retirement age, they don’t realize they’re going to have that much wealth later on. But it’s very easy to get to that realm if you’re taking care of your finances appropriately,
Maggie Lake 8:50
right? And again, this isn’t necessarily liquid. I’m looking at it today in this one particular account. You’re talking about shares of businesses that you you know that you may, that may come your way, or you may be a part of through an extended family. You could talk about the home you own, if that has to be sold, like all of these harder assets, right? That people don’t tend to think about if they’re just looking at, say, their 401 statement, or something like that fall category when you’re making these calculations,
Brandy Maben 9:16
yeah. And what about when you lose your spouse or your grandparents or your parents, and they had a life insurance policy that now you’re a millionaire because they planned ahead and left their inheritance in a insurance policy that on top of your primary home investment properties, gold, silver, that you might have, who knows what, investments that you kind of lock into A 401, K, and haven’t paid attention to in 15 years. All of that accumulates into that net net worth number that you’re talking about.
Maggie Lake 9:47
So on the on the estate and gift. So the current exemption, and again, you know this is, this is just to be aware of this might happen. I. So that has the potential to be halved. What else do people have to consider if they’re in that situation where they want to be thinking about the future and kind of preparing themselves and future generations? What else is on the table that we may not realize?
Brandy Maben 10:14
You know, that’s really the biggest thing we’re advising clients right now, is just go meet with your estate attorney, bring us in the loop, and let’s discover what you have and how you should plan accordingly. So those are the major things we’re doing with our clients at the moment.
Maggie Lake 10:28
What is, what is, what are some are there easy? I don’t wanna say easy. That’s the wrong word. Are there options, or are there strategies that exist that can help mitigate this? You know, I know you guys are aware of, a lot more things. A lot of them have acronyms that I’ve never heard of, that we may not tools that we may not know about to kind of maybe better prepare in case one of these proposals remains in there, right?
Brandy Maben 10:55
There’s a lot of them, there’s grats slats, all that have acronyms of grantor retained annuity trust or a spousal life annuity trust, or you can do intentional defective grantor trust. I mean, the jargon gets very complex, and we don’t need to get into the nitty gritty of those, but the fact finding is so important, and when we talk to clients, or we vet clients that call in from wealthion, which is always great conversation. We can guide them on what fact pattern they have and which trust would be most applicable to them and their situation. But there’s so many avenues for strategic planning with your trust. If you don’t have a trust, it’s always worth looking into and having a conversation with someone like us.
Maggie Lake 11:43
So we’re talking about, yeah, and it’s a good point, because honestly, most of us don’t come across those. And by the way, the minute you see an acronym, we all kind of glaze over and yeah, like your stress level, for me, it’s like, I can’t hear you anymore. You know, it’s like, I don’t know what that means, but it’s so it sounds like this is, I mean, there’s a lot of stuff in there, as we said, but very important, if there’s a trust involved at all, or should you have one? And if you don’t, how do you now build one? Because it may be a lot different than what you considered before, straightforward retirement now, potentially looking at having to pay taxes on a lot of that stuff sooner, or forced disbursements or flexibility gone. Age requirements down. Salary requirements also lowered, meaning it’s harder to find that protection. This sounds all very negative. I mean, is it all bad news, or are there things happening that also may provide some sort of opportunity?
Brandy Maben 12:45
You’re right. We went doom and gloom pretty quick. Well, we have to, let’s be clear,
Maggie Lake 12:49
protective preservation should be top of mind right now, but
Brandy Maben 12:54
sadly, a lot of the proposals are to help the deficit, like we talked about earlier, so that does pinch some of the benefits we’ve been very we’ve just become accustomed to, sadly, and they’re about to be ripped so I would say one good opportunity is opportunity zones, and those can be really advantageous if people own real estate and are looking to invest in rural areas or do a 1031, exchange and have a strategic place to put things and not incur capital gains. Sadly, those even are tightening on some restrictions. Income level rural rural areas are more strictly defined, and then median income levels within those rural areas are really being pinched tighter, so these are going to be harder to get into, more selective by government entities. But if the opportunity zones do pass, it’s really advantageous for so many Americans that have bought a home and don’t know what to do with it, or multiple homes and don’t know what to do with them. So that’s
Maggie Lake 14:05
so interesting. This is something that I don’t think we have talked much about, or has gotten much attention at all. What talk to me, give me a little bit more background about this, because I bet a bunch of people are scratching their heads if they’re not, is this? Are you? Are you buying real estate or REITs that look for opportunity in opportunity zones, or look for potential properties and opportunity loans? Is this a matter of relocating yourself or your business into an opportunity zone? Give me a little bit more background on that,
Brandy Maben 14:35
right? So most people, I wouldn’t say most, but a more common phrase is a 1031, exchange that is exchanging one home, let’s say, for example, for another home, and not having to pay the capital gains on it. So instead of getting cash, paying tax on that gain of the cash that you got, it’s more like trading cards. So. So you’re actually trading one card for another card, and the government gives you forgiveness, because you’re basically just improving the economy, keeping it in the same asset. So a 1031 exchange is one topic that can kind of roll into what an opportunity zone offers. So if you have a home, let’s say, and you want to sell it. You bought it for $500,000 you’re selling it for a million dollars. You don’t need all of that appreciation, and so you’re downsizing, let’s say, and you want to put it somewhere so you don’t have to pay that $500,000 tax at a very high income rate, which is also on the table to increase. So what you do is you find an opportunity zone. An opportunity zone is a rural area that investors or a construction company, let’s say, bought into and is trying to revive and improve to make sure that a city, a town, a district, is improving their look and their economy. So it’s encouraging people with these 1030, ones, with these people that want to get into different investments, like real estate, an opportunity to while also helping our economy in rural areas. Now these rural areas used to be very flexible. And if you know Scottsdale, Arizona, there were opportunity zones in Scottsdale, Arizona, wow. If you got into those, you were lucky and smart and you had a great investment due to the new rules. I doubt Scottsdale Arizona is going to be on the ticket of investment opportunities starting in 2027 but it does open the door for these to continue to grow. So we we have opportunity zone investors all the way from 2000 let’s say 17 till now. If you keep your money that you transferred over into this for five years, you get a 10% step up in basis. If you withdraw the money at that point, you only have to pay 90% of the tax that you were to owe. If you keep it for seven years, then you owe 15% you get a 15% discount of step up in basis, meaning 75 or you know what I mean, 85%
Maggie Lake 17:24
you keep getting to keep more of your money the longer you let them you keep capital invested in that area.
Brandy Maben 17:30
But the big winner is if you keep it in there for 10 years, then there’s no capital gain tax on your investment, and you take it tax free while investing it into a new opportunity. So it’s it’s fantastic. We have a lot of people that got in it before 2026 when it’s sun setting. And so we’re going to continue to ride those out to the 10 year period so they don’t have any tax now there’s going to be a gap year from 2026 to 2027 and they’re going to rezone all of these opportunities and make sure they’re actually in rural areas that help America. And then we can start again. And that phase of getting into new opportunity zone will be from 2027 to 2033 so we’re going to have another window to get our clients into these opportunities. It looks like that’s only if it’s passed, but we’re hopeful about that one.
Maggie Lake 18:27
Yeah, first of all, like nothing, like a win, win, right? Like, I love when we can structure things with an incentive, as opposed to, you know, a penalty. I think a lot of us can get behind that, because it sounds like a really smart idea all around you know, the catch is, of course, is this mainly geared toward residential, or is this also commercial? Or is it more commercial than residential? Everything
Brandy Maben 18:49
has to be like kind so right home to a home, if it’s a business, to a business, you had
Maggie Lake 18:55
a business rental on a main street in a high cost area, and you want to take advantage of getting rid of that. You can do the same in a like in an opportunity zone, hang on to it for 10 years and not pay the tax on that and not get ready to reinvest, right? Wow. I’m sorry, I didn’t know about opportunity zones. I feel, I feel like a lot of people are saying that to themselves right now, super interesting, important in that you said it. There’s not going to be any opportunity for a year, though, while they rezone, right? So interesting. This is what I mean, you know, in 1000 pages of stuff, but this is the kind of thing I think a lot of us think we’re on top of our, you know, our retirement and our planning, but there’s a lot of this kind of detail that we’re just not aware of because it’s not our full time job. So I want to talk a little bit about timing, because I think one of the things that’s happening with anything that touches Washington is it’s there’s so many headlines flying around that you just can’t it becomes too much, and you just kind of shut down and say, You know what? Like, call me when it’s over, give me a ring when you finally, finally hammered this out, because they could be fighting forever, right? It’s not. How are you thinking about the timing of that, especially where we’re falling here in the year, because if this drags out, we’re going to get closer to the end of the end of the year, where I’m assuming Decisions have to make. What do we what do we need to understand? Or how are you approaching the timing issue?
Brandy Maben 20:16
The timing issue has started January one, when we heard scuttlebug of all of these things. So we’re meeting with the state attorneys now we’re looking into opportunity zones. Now I have a weekly meeting about them with various companies or different private investors to make sure we’re we’re on the ground floor of anything we can get into at the last minute. But we’re also telling clients that if we can’t, let’s make a plan to hold for a year, or when we go back to the retirement accounts, we’re really planning on converting a little bit more aggressively, in case we can’t convert anymore. Having another thing I didn’t even mention, you’re you might have to take RMDs on Roth IRAs now we never had to. That was kind of a perk of having one. So how do we how do we strategize around that? It’s a daily conversation with our clients right now. You can’t get on top of it soon enough. You don’t want to wait, because if you’re opening this door in October, every estate attorney around where I live is going to be booked and not be able to help you out.
Maggie Lake 21:21
Wow, that’s, that’s, that’s good advice and understandable, because it takes you want to have time to be able to make to the decision that you want to and have the options open that you’re happy with it. You don’t want to be rushing this on deadline, if, if, and you know, you may not know the answer to this. I don’t know if we, any of us do in the current environment, but do you have a sense from of the time lag between when something would be decided and when it would go into effect? Or is that something that’s going to be really important to watch? You know, what’s grandfathered what’s the sort of like, Go date for these changes?
Brandy Maben 21:57
That’s the million dollar question. So it once the House passed this and sent it to the Senate. It really became a when’s the next date? When’s the Senate gonna release their decision on it? And honestly, June 9 was one of them. So I said, Okay, great. I’ll have a little more info before this interview. Nothing. And so we had no updates yesterday, no updates today. We don’t know when we’re going to hear them. They really go back and forth, as everybody knows, but the timeline is so unknown, so we’re all just watching and be careful of headlines. You hear everything you see and read, you can’t believe it all. So it’s really important to consult with an advisor that does this for a living and has a team of analysts that’s constantly on the pulse of it, so that you’re not getting the wrong advice and panicking in the wrong
Maggie Lake 22:51
way. Yeah. Like, leave it to all of you to do the watching for us, but I do think it’s a real call to make sure that you do a thorough check of where you stand, of course, where you might fall, even if you don’t think you’re going to be affected, like, make sure that you know there are things that you’re not considering that could come at you. And then make sure you’re ready. Make sure you have your options on the table. So then we do have a little more information. Everybody’s ready to, you know, to pull the trigger and do what they need to do. Brandy, I can’t thank you enough. This was so informative. I know there’s like 10 other buckets you’re watching, so we’ll be sure to get you back on next time it goes through some of the other areas that we may be looking at potential changes. But thank you so much. Appreciate you. Great. Thank you. If you have any questions about how to navigate the current environment, wealthion can help connect you with a vetted advisor to get a free portfolio review, just click the link in the description below or head to wealthion.com/free there’s no obligation, and it will just take a few minutes of your time. Again. That’s wealthion.com/free thanks so much for joining us. We’ll see you again next time you.
