After the death of a spouse, a client has several options for handling the retirement accounts that belonged to the deceased. Here is a brief overview of the financial implications of different strategies for managing IRAs and Roth IRAs. This helpful chart shows the rules and requirements related to distributions for clients who inherit a Roth IRA. To read the full article in MarketWatch, click: Tips for Managing an Inherited IRA.
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The Tax Cuts and Jobs Act has provided certain advantages for clients, including a 20% deduction for qualified business income and a higher standard deduction. But a cap on deductions for state and local taxes and a different method for determining inflation adjustments could create challenges. “The TCJA has given wealthy taxpayers some interesting changes to their return,” noted Scott Kadrlik, CPA, PFS. To read the full article in Financial Advisor Magazine, click: Potential 2019 Tax Changes Your Wealthy Clients Need to Know About.
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The Benefits of Setting Up a Trusteed IRA Trusteed individual retirement accounts are not right for every circumstance, but they can provide additional control over assets. For example, trusteed IRAs can help clients determine what happens to assets after the death of a beneficiary, which can be especially useful for clients who have been married multiple times. Talk with your clients about trusteed and other types of IRAs. To read the full article in FinancialPlanning, click: When You Should Establish an IRA as a Trust.
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How Personal Financial Planning Complements CPA Practices Adding personal financial planning services can help CPA firms build stronger bonds with clients and open up opportunities for referrals, writes Stuart Kessler, CPA, PFS. He shares several techniques that can help your PFP practice, beginning with helping clients feel relaxed and comfortable during initial meetings. CPAs who are interested in adding PFP services to their firm can access this roadmap developed by the AICPA Personal Financial Planning Division. To read the full article in The CPA Journal, click: Why Financial Planning Makes Sense for CPAs.
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Hidden Headaches of Jointly Owned Annuities Annuities are considered wonderful vehicles for savers, no more so than for married couples. The opportunity to obtain tax-deferred growth in a non-qualified deferred annuity is a key feature, particularly for individuals in high tax brackets who have already maxed out other available tax shelters. However, annuities present a significant complication. Michael Kitces, FinancialPlanning contributing writer, does an excellent job describing what to look for. To read the full article in the FinancialPlanning, click: Hidden Headaches of Jointly Owned Annuities.
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Don’t Let Clients Fall into This Social Security Tax Trap Social Security recipients may face disproportionately high tax rates because of the way the IRS calculates income with respect to Social Security. So-called combined income includes adjusted gross income as well as tax-free income, half of Social Security income and some add-ons. Paul Norr, certified financial planner with Bucks County Financial Planning Group, discusses how advisers can help clients manage the tax bite in several ways. To read the full article in Financial Planning, click: Social Security: Keeping Exorbitant Tax Rates at Bay.
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There’s a window of opportunity before clients reach age 70 in order to mitigate some of the bite. Paul Norr shares some great tips to prepare your clients for their future years. To read the full article in Financial Planning, click: Avoid the Social Security Tax Trap.
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The Many Tax Benefits of Making Charitable Contributions With IRA Distributions Now that the provision permitting these contributions is permanent, taxpayers can take maximum advantage of this rule, even using life insurance to increase the gift to charity. David K. Smucker, CPA, Advanced Consulting Group director with Nationwide Insurance, explains that the recent legislation making the $100,000 charitable IRA contribution permanent allows taxpayers to take full advantage of the numerous tax benefits of these contributions. To read the full article in The Tax Adviser Tax Insider, click: Charitable IRA Distributions: A Great Opportunity.
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Thanks to the U.S. Senate, IRA owners age 701/2 and older have until Wednesday, December 31, 2014, to make a direct transfer from their account to an eligible charity of their choice of up to $100,000 without paying taxes on the distribution. The senate approved the direct rollover in addition to more than 50 other tax provisions as part of the extender’s package on December 16, 2014—just two weeks shy of the year-end deadline. This option, which first became available in 2006, can be a smart alternative for some IRA owners by allowing them to take their mandated annual required…