As outlined in U.S. News and World Report, Roth IRAs have many appealing characteristics. They grow income tax free. Owners are not required to take minimum distributions at age 70 1/2 so long as the account has been in place for five years. The income limit has been removed on…
Authority to appoint the property of an original trust to a second trust is commonly referred to as decanting authority. This gives authority to a trustee allowing him to adapt and revise the terms of a trust due to unforeseen circumstances or drafting errors. Statutory decanting authority allows for modification of…
Congress put in place the kiddie tax to prevent individuals from putting assets in the names of their children who typically have far lower tax rates than their parents. As Laura Saunders points out in a recent article in the Wall Street Journal, this tax needs to be kept in…
You execute your Durable Power of Attorney for Property while you are competent. Your agent is given power to act on your behalf. Because it is durable, the Power of Attorney document can still be used if you become incompetent. A Power of Attorney for Property includes many speficially referenced powers. 1) Real Estate Transactions –…
In his article titled Estate Planning for a Family with a Special Needs Child, Sebastian V. Grassi, Jr. lists five estate planning options for parents of a special needs child 1. Distributing assets directly to the special needs child; 2. Disinheriting the special needs child; 3. Leaving property to another…
You can withdraw your original contributions to a Roth at any time. But you must wait five years to avoid paying the tax on earnings on regular contributions and you must be 59 1/2 years old. If you inherit a Roth from your spouse, the taxable period ends either five…
The components of Medicare are: 1) Part A, mainly hospital coverage; 2) Part B, outpatient coverage; and 3) Part D, drug coverage. Medigap coverage pays the uncovered portions of most Medicare bills. There is also Medicare Advantage coverage which provides most of the coverages in items 1), 2), 3) and…
Anne Kates Smith discusses in her article in Kiplinger’s magazine a law enacted at the end of last year which authorizes tax-advantaged savings accounts for individuals with disabilities knows as ABLE (Achieving Better Life Experience) accounts. Anyone can open an ABLE account for an eligible beneficiary. This is someone who…
In the November 2015 issue of Kipplinger’s magazine, an article points out that it is common for families to distribute assets through the use of trusts, which come in more flavors than Jelly Belly jelly beans. Trusts can minimize estate taxes, protect assets from mistakes of heirs or avoid probate…
A Home Equity Line of Credit allows you to get cash from the equity you have in your home. Most lenders look for a cushion of 30% equity already in the home before they will consider allowing the homeowner to borrow against the home’s equity. With house values only beginning…