The Republican tax plan may still be in flux. But the wealthy are already taking steps to avoid some of the most costly parts of the plan and reduce their taxes.



Wealth management firms and accountants to the rich are scrambling to prepare their clients for the biggest set of tax changes since 1986. While Democrats call the plan a boon to the rich, some aspects of the plan — mainly the elimination of state and local tax deductions – will mean a tax hike for certain high-income earners. Tax planners are already devising ways to limit those hikes and take advantage of the myriad of other loopholes.



Here are some of the changes that accountants and planning experts are recommending clients make before the end of the year:



Load up on SALT: Both the House and Senate plans call for the elimination of state and local tax deductions. The House plan allows for a deduction of up to $10,000 on local property taxes. Whatever the final bill, it's almost certain that state income taxes and a good chunk of property taxes will no longer be deductible.



Accountants are recommending a novel approach: Prepay your estimated 2018 state and local taxes in 2017. That way you can take the deduction while those taxes are still deductible.



Of course, it's not quite that simple. The AMT (which is still in effect) prevents many high-income taxpayers from taking too many deductions. And high-earners whose incomes come from wages — as opposed to investment income or owning a company or pass-through – have a tougher time prepaying since their state income taxes are paid through withholding. What's more, not all states or communities allow prepayment of next year's taxes.



But some taxpayers in certain states — including New York and New Jersey — can prepay taxes owed for at least part of 2018. Taxpayers in New York can prepay online, though other states may require forms.



Of course, you may end up overpaying, since it's just an estimate of your expected 2018 taxes. And any refund could be treated as taxable income. But accountants say the savings could still be significant.



"For a lot of people it's certainly worth a shot," said Joseph Perry, a tax advisor at Marcum, who advises many wealthy families. "The worst that happens is that you get it back and pay a tax on that."



Win from your losses: The Senate bill requires "FIFO" — first-in-first-out tax treatment on the sale of securities. This means that investors will have to sell the shares in the order in which they bought them and can no longer designate which shares they can sell to minimize capital gains.



To prepare, investors can sell tax lots that have losses and capture the loss to offset future capital gains before the end of the year. Of course, with markets up double digits this year, finding money-losers may not be easy. But it makes sense to harvest your losses now from select lots while you still can.

You can also gift tax lots that have a low cost basis on the oldest lots you purchased because you might not be able to in the future.



Get your mortgage: The House version of the tax bill would cap the mortgage-interest deduction at $500,000. Existing mortgages are grandfathered in. But Swiss Bank UBS is advising that clients "looking to initiate or refinance mortgages larger than $500K should close prior to the end of the year."



Stay alive 'til 2025: If you have an estate valued at over $5.5 million, do your best to stay healthy, because the estate tax is likely to be altered or eliminated. The House bill repeals the tax after 2024, and the Senate plan doubles the exemption, so estates of less than $11 million per person are excluded.