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19
Jun

Fixing Missed 60-Day Rollover Deadlines with Self-Certification in 5 Easy Steps

If I miss the 60-day deadline for completing an IRA rollover, is there any way to save the rollover amount from tax? Failing to complete a 60-day rollover on time can cause the rollover amount to be taxed as income and perhaps subject to a 10% early withdrawal penalty. However, the deadline may have been missed due to reasons that are not the taxpayer’s fault.

12
Jun

Planning For Multiple Beneficiaries in 5 Easy Steps

When do multiple beneficiaries exist? Multiple beneficiaries exist when an individual names more than one beneficiary for their IRA. When should you name more than one beneficiary? When you want your IRA assets to go to more than one person or entity without having to incur additional fees or paperwork by maintaining separate accounts for each beneficiary. 1. Due date for designated beneficiaries.

5
Jun

Calculating an IRD Deduction in 5 Easy Steps

What is an IRD (Income in Respect of a Decedent) deduction? An IRD deduction is a way of offsetting the impact of double taxation (federal estate tax and income tax) on certain inherited assets. It’s an income tax deduction for the beneficiary (miscellaneous itemized deduction, not subject to limitations). When should you look for an IRD deduction?

15
May

Using IRAs to Help Children in 5 Easy Steps

Can children have IRAs? There is no minimum age for having an IRA. Due to the power of compound interest, saving tax-free in an IRA from childhood can provide a significant head start on financial security. Saving $6,500 in an IRA annually from age 14 through 24 and earning 7% per year provides over $1 million at age 61—even without contributing after age 24! 1.

8
May

Avoiding Non-Spouse Beneficiary Mistakes in 5 Easy Steps

How can I avoid making costly mistakes when I inherit an IRA from a person who was not my spouse? Inheriting an IRA can be a financial windfall, but it’s important to understand the complex, specific rules that apply to non-spouse IRA beneficiaries to avoid critical errors. 1. At first, don’t do anything! Especially, don’t take a distribution from the IRA. Doing so without proper planning may forfeit years of potential tax-favored investment returns.

1
May

Contributing to a Health Savings Account (HSA) in 5 Easy Steps

What is an HSA? An HSA is a tax-advantaged medical savings account that can be used tax-free for qualified medical expenses. HSAs are designed to be used in conjunction with a High Deductible Health Plan (HDHP). HSAs offer triple tax advantages: contributions are deductible, earnings are tax-deferred while in the HSA, and distributions are tax-free when used for qualified medical expenses. 1. Determine if you are eligible to make an HSA contribution.

10
Apr

Avoiding Spousal Beneficiary Mistakes in 5 Easy Steps

Who is a spouse beneficiary? A spouse beneficiary must be married to the account owner at the time of the account owner’s death, and he or she must be named on the beneficiary form (or inherit directly through the document default provisions). A spouse beneficiary has a number of unique options. 1. Split the inherited account if necessary.

3
Apr

Using a Tax Refund to Fund an IRA in 5 Easy Steps

What does the basic process entail? An income tax refund can be directly deposited to an IRA up to the annual contribution limit. The contribution limit was $6,000 ($7,000 for individuals age 50 or older) for 2022 and $6,500/$7,500 in 2023. It can also be split among multiple accounts. 1. It is tax time! Prepare your tax return for the year. 2. Determine the refund amount.

20
Mar

Avoiding Mistakes in a Divorce in 5 Easy Steps

Retirement accounts and divorce. When a divorce occurs, the financial assets of a couple, including their retirement accounts, are often split. If mistakes are made during this process, the stress of adivorce can be compounded when one or both spouses find that they are subject to unnecessary taxes or penalties. 1. IRAs in divorce.

13
Mar

Choosing the Right Financial Advisor in 5 Easy Steps

Why do you need a financial advisor? Today’s financial landscape is as complicated as ever. A good financial advisor can help you navigate this complexity so that you can make educated, informed decisions on what is best for you and your family. 1. Ask for references. Ask your CPA or estate planning attorney. In many cases, they already have a working relationship with a financial advisor.