Two provisions took effect this year that share the same theme: the tax breaks business owners have relied on for years are shrinking right at the income level where they matter most. Neither change made front-page news. Both are already showing up in year-end planning conversations.

The SALT Deduction Now Has a Cliff, Not a Ramp

The alternative minimum tax, or AMT, is a parallel tax system designed to make sure higher earners can't deduct their way to a very low bill. For 2026, the exemption that shields income from AMT drops for married filers, and the rate at which that exemption phases out doubles — from 25% to 50%.

In practical terms: if you're planning to exercise incentive stock options this year, the AMT bill on that exercise could be significantly larger than it would have been in 2025 — even if the stock's value hasn't moved. Anyone holding unexercised ISOs should run a projection before pulling the trigger, not after.

The Bonus Trap

Here's where it gets counterintuitive. Several 2026 provisions — including the SALT deduction cap — phase out based on modified adjusted gross income, not tax bracket. The raised SALT cap of $40,400 only applies below $505,000 in MAGI; above that, the benefit disappears entirely by the time you hit $600,000, and you're back to the old $10,000 cap.

That means an executive sitting near that threshold can take a bonus, a vested Restricted Stock Unit tranche, or a strong commission quarter, and watch it push them across a line that costs more in lost deductions than the bonus itself was worth. At this income level, the question isn't what you earn — it's what stays out of your MAGI in the first place.

The Piece Most Plans Miss

Every strategy above is a defensive move — timing, projections, deferral. None of it changes the underlying problem: as long as growth shows up on a 1099 or a W-2, it's exposed to whatever threshold Congress sets next. The Kai-Zen strategy works differently. Contributions grow inside a permanent life insurance structure, matched by bank financing at roughly 3:1, and the growth comes out tax-free in retirement — none of it touching your reportable MAGI along the way.

For executives sitting right in the AMT and SALT phase-out zone, that's not a minor detail. It's the difference between a bonus that quietly costs you money and one that builds wealth without triggering the next stealth tax.

Before You Accept Your Next Bonus or Exercise an Option

Kent Cornell, CFP®, helps executives and business owners run the numbers before these decisions — not after the tax bill arrives.

Get Your Free Retirement Analysis Now!

How To Be A Christian That Impacts Others (Proverbs 3:1-6)

“How To Be A Christian That Impacts Others (Proverbs 3:1–6)” focuses on how believers can influence others through a life that genuinely reflects God’s wisdom and character. Drawing from Proverbs 3:1–6, the message emphasizes remembering and obeying God’s Word, practicing love and faithfulness, and trusting God rather than relying solely on personal understanding. The passage teaches that a Christian’s influence comes not just from what they say, but from how they live—through integrity, humility, obedience, and consistent dependence on God.

The message also challenges Christians to surrender their plans and decisions to God, trusting Him to direct their paths. A life centered on God can impact family, friends, coworkers, and the wider community because people can see faith demonstrated through everyday choices. The overall lesson is that meaningful Christian influence begins with a personal relationship with God: trust Him, acknowledge Him, follow His Word, and allow your life to point others toward Him.