Making Tax-Efficient Donations and Gifts

Building on our recent tax newsletter, below are some charitable giving suggestions that might help reduce taxes while providing some personal fulfillment.  It is well known that giving comes from the heart and is not typically financially motivated, but it doesn’t hurt to receive a little benefit when your tax liability is reduced.  Taxes and charitable giving are unique to the individual. Since these recommendations might not be appropriate for everyone, always check with a professional advisor before making any final decisions.   Donating Appreciated Stock Starting with the basics, you can typically donate appreciated stocks and mutual funds directly to a charity equipped to accept them.  If you want to make several gifts to multiple recipients consider opening a donor advised fund with either Charles Schwab or Fidelity Investments.  The donation to a donor advised fund is tax deductible in the year deposited to the account.  If you want to make several donations or you aren’t sure which charity you want to give to, the donor advised fund is ideal.  For more information on donor advised funds please visit Read on! →

Don’t Miss Open Enrollment

You can feel it in the air, fall is officially upon us. In addition to football, pumpkin patches and sweater weather, fall is also time for open enrollment. Open enrollment (also known as annual enrollment) is a period of time when individuals may make additions, changes or deletions to their elected employee benefits, individual health insurance, or Medicare coverage. Whether you are working and need to update your benefits package at work, are retired and eligible for Medicare benefits, or are under age 65 and not covered by a group health insurance policy, you should consider your options before the designated open enrollment period begins. Employee Benefits Typically, open enrollment for employee benefits begins in the fall of each year, but the timing will vary slightly from company to company. The specific time period and details for your employer’s plan(s) will be communicated by your HR department, so remember to open and read all communications you receive regarding your group plans. Some companies have made changes to the eligibility requirements for spousal benefits starting in 2014. Be sure to review the Read on! →

Update from The Federal Reserve – Wed. September 18, 2013

Wed. September 18, 2013 Due to an uneven economic climate, Federal Reserve officials decided Wednesday to hold off on discontinuing their easy money policy for the time being. Below is an excerpt from the Fed’s Monetary Policy Press Release detailing the reasons behind Wednesday’s decision. To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that a highly accommodative stance of monetary policy will remain appropriate for a considerable time after the asset purchase program ends and the economic recovery strengthens. In particular, the Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that this exceptionally low range for the federal funds rate will be appropriate at least as long as the unemployment rate remains above 6-1/2 percent, inflation between one and two years ahead is projected to be no more than a half percentage point above the Committee’s 2 percent longer-run goal, and longer-term inflation expectations continue to be well anchored. In determining how long to maintain a highly accommodative stance of Read on! →

Life Transitions and the Sandwich Generation

One thing we all realize as we journey through life is that change is constant.  The changes can be positive or negative, and can include things like a job change, a child leaving for college, the birth of a child, starting school, graduating from school, difficulties at work, buying a house, empty nest, marriage, divorce, or death.  When only one transition hits at a time, we are typically able to concentrate and continue to function at very high levels.  However, there are times when the combination of stressors can be so overwhelming they have a serious impact on our brains’ ability to objectively cope with our lives. Consider the stressors of the Sandwich Generation.  This generation primarily encompasses those individuals aged 40-65 who find themselves caring for both their children and their aging parents.  They are essentially sandwiched between the generations; raising their children, saving for education, pursuing careers, saving for retirement and in many cases coordinating and providing for the daily care of their parents.  Because lifespans have increased, more adults have parents living well into their 80’s who Read on! →

Taxing Times – September 2013 Newsletter

While you may not want to begin thinking about it in September, there are some “taxing” issues that you need to be aware of for 2013 and on the horizon for 2014.  As you may recall from early January, the Fiscal Cliff law resulted in a number of federal income tax changes, some permanent and others just extended for one year. Medicare Surtax Net Investment Income Tax (NIIT) Tax Rate Changes for High Income Earners Roth Conversion Opportunities Expanded Temporary Tax-related Extensions for 2013 A 2014 Tax Preview for North Carolina Residents Medicare surtax For high earning individuals, you may already have noticed a slight decline in your take home pay, for as you surpassed $200,000 in wages, your employer was required to begin deducting an additional 0.9% on your Medicare-eligible wages.  This is in addition to the 1.45% you are already paying in Medicare taxes. While this new surtax will result in automatic additional withholding for an individual with earnings above $200,000, the tax can also be triggered by combined earnings of spouses, or the combination of wage earnings Read on! →