The Republican-sponsored tax plan under President Donald Trump proposes numerous changes.

One of the most discussed parts of the plan is the number of tax brackets and the respective rates. The House and Senate differ on both. The House version of the tax plan shrinks the total brackets from seven to four, at rates of 12 percent, 25, 35 and 39.6. The Senate bill retains the seven brackets but tweaks the rates – 10, 12, 22, 24, 32, 35 and 38.5 percent.

The effects on those strategizing their retirement could be profound, depending on their bracket and investment approaches. At minimum, many will need to review their situations carefully.

The proposed changes – and any others that may come with this administration – could have a big effect on annual tax returns and retirement investment plans.

So, of course, people are curious about how they should prepare.

One common question with the proposed tax plan is whether contributing to a 401(k) will become less valuable from a tax perspective. If President Trump succeeds in restructuring the current tax bracket system, it’s something to look at if you think you will end up moving into a lower tax bracket. But remember, your bracket may be lower in retirement than it is now or will be even with Trump’s changes. Also, your 401(k) earnings grow faster because they’re tax-deferred. And if your employer offers some kind of match, you don’t want to miss out on that money.

The proposed cap on itemized deductions could impact higher-income earners by neutralizing any reduction in marginal tax rates. According to Howard Gleckman of the

Tax Policy Center, singles and couples who make $1 million or more could take a hit with the $200,000 cap. One significant proposal that would benefit some higher income earners would be the elimination of the alternative minimum tax, which the House bill proposes. Those who live in higher-tax states, or who have stock options or other alternative minimum tax preference items, would no longer have to pay the non-graduated alternative minimum tax rates on their income.

The Roth 401(k) is a good option when anyone believes their assets will appreciate substantially. That’s because those gains are exempted from additional tax. However, a traditional non-Roth may be advantageous for people who don’t anticipate big gains, or who are planning their income to maintain lower marginal tax rates. You need to take a realistic look at the tax bracket you’ll be in when you retire.

Trump’s proposals would not change the current rate structure for long-term capital gains; however, short-term capital gains, which are taxed at ordinary marginal income tax rates, would be reduced to reflect the new marginal rate structure.

At this point, it’s difficult to know if or when Trump’s tax proposal will become a reality. Still, there’s a chance his proposals could become policy, so plan to meet with your tax adviser now to talk about what these changes would mean to you.

Richard W. Paul is the president of Richard Paul & Associates, LLC and the author of “The Baby Boomers' Retirement Survival Guide: How to Navigate Through the Turbulent Times Ahead.” He is a Certified Financial PlannerTM professional, Registered Financial Consultant, Investment Adviser Representative and an insurance professional holding life and health insurance licenses in Michigan and Florida.