WHO'S THE B-O-S-S?

WHAT DOES B-O-S-S STAND FOR?

BOSS is an acronym that we use to refer to the four key people everyone must consider with respect to retirement planning, i.e., developing an income exit strategy and ensuring all IRAs, 401(k)s and other retirement plans are set up properly. To ensure retirement assets will be distributed in a manner consistent with an overall retirement plan, all paperwork must be filled out accurately and clearly reflect the owner’s wishes. To assist in this, we recommend what we call a BOSS review. This is a retirement plan review that should be conducted at least once per year and must be conducted anytime there is a life changing event such as birth, death, marriage or divorce.

Even though an IRA is frequently the largest asset people have, except perhaps their home, many IRA owners surprisingly fail to conduct a BOSS review on an annual basis to ensure that their money will flow the way they want it to. Many people are unaware that unless their IRAs and other retirement plans are set up correctly, they will be leaving their heirs a tax bill and not a legacy. Nobody is immune to IRA mistakes. Plenty of well educated, intelligent, wealthy individuals die without proper planning because they just didn’t know they had a serious problem…a problem that, sadly, could have been easily corrected.

It’s important to understand what happens to your IRA when you pass away. Many people think that their IRA passes through their will, it does not. The IRA beneficiary designation form determines what happens to IRA assets. IRAs are not inherently probate assets, meaning, they do not need to go through the probate system which requires that a probate court declare how and to whom the assets shall be distributed. IRA assets COULD, however, end up going through the probate court system if there is no valid designated beneficiary and, as a default, the IRA ends up going into the deceased’s estate.

You may ask yourself, why does it matter if my IRA or 401(k) goes to my estate, my children are the beneficiaries of my estate anyway, so what’s the big deal?

The big deal is that if the estate is the beneficiary of an IRA, the opportunity for heirs to stretch the IRA RMDs over their individual life expectancies is effectively destroyed. The opportunity for heirs to enjoy continued tax deferred growth on those IRA funds will be destroyed. The opportunity for heirs to maximize the benefit of the IRA by turning the tax infested IRA into a tax efficient legacy from you is destroyed!

Simple Mistakes Can Cost Beneficiaries Everything

Beneficiary designation forms are an often overlooked area of estate planning that can have dire consequences if not taken care of. For example, divorce is already an unpleasant event but imagine that your ex-spouse gets the proceeds of your life insurance policy and/or retirement accounts because you forgot to update your beneficiary designation forms. In Kennedy v. Plan Administrator for DuPont Savings and Investment Plan, Kari Kennedy was the administrator of her father’s estate and tried to recover $402,000 that was paid to her father’s ex-spouse. As part of the divorce agreement, the soon to be ex-wife had given up her rights to Mr. Kennedy’s pension and other work-related benefits.

However, Mr. Kennedy failed to remove his ex-wife as the beneficiary of his investment plan assets and replace it with Kari’s name. Following his death, the funds went to his ex-spouse, not Kari as he had intended.

The case made it all the way to the Supreme Court but, unfortunately, Kari was not deemed the beneficiary because, under ERISA, the beneficiary designation form trumps a divorce decree. The Court made it clear that a former spouse can give up the right to retirement benefits as part of a divorce decree but the specific terms of an ERISA governed plan ultimately control what happens to the plan assets.

This is an extreme case but it illustrates the dire consequence of failing to review and update beneficiary designation forms whenever a life changing event occurs such as death, divorce, marriage or birth. A beneficiary review is an important part of your financial review process that your advisor can help guide you through.

Tips to Avoid IRA Errors

Know the Contribution Limits

There is a maximum amount you may contribute each year to your IRAs. The aggregate limit for 2016 is $5,500 ($6,500 if age 50 or older). This limit includes all contributions to all of your traditional IRAs and

Roth IRAs.

Avoid Excess Contributions

If you exceed the annual contribution limit, you will be penalized unless you withdraw the excess amount in a timely fashion. The penalty is currently 6% and this penalty applies each year the excess amount remains in your IRA(s).

Take RMDs on Time

Whether you are an IRA owner who is over age 70½ or you have inherited an IRA from someone, there is a 50% penalty for every missed required minimum distribution! Yes, a 50% penalty on the undistributed amount so mark your calendars with the annual December 31st deadline and avoid this common error.

Keep Beneficiary Forms Updated

If you fail to name a designated IRA beneficiary, it could have unintended consequences. What is a  “designated” beneficiary? Aren’t all beneficiaries “designated”? No, they are not the same! A designated beneficiary is a living, breathing, human with a remaining life expectancy. Charities cannot be designated. Estates cannot be designated. Trusts cannot be designated. Your beloved dog cannot be designated. Failure to name a designated beneficiary essentially diminishes the opportunity for individual beneficiaries to maximize the benefits of tax deferred distributions on an inherited IRA.

Life changing events such as marriage, death, divorce, birth and adoption occur regularly and could impact your beneficiary designation decisions. Every IRA owner should conduct a beneficiary form review at least once a year to ensure that IRA assets will pass to the intended beneficiaries.

Don’t Guess, Know the Rules

Do you have questions or need help with your personal situation? Your retirement distribution expert can assist you! Call today to schedule a free consultation, ask questions or discuss important IRA planning issues such as: conducting a beneficiary review, correcting IRA mistakes, making sure you’re with the right IRA custodian

Attention Accountants!

As trusted advisors, clients often look to their accountants for guidance and advice on a wide range of tax related and financial issues. But not all firms can offer a full solution to their clients, thus missing out on important business opportunities and a competitive edge. During a recent survey conducted by Accounting Today, they spoke to tax professionals who offer financial services to their clients as well as those who don’t. On Thursday, June 9th at 12:30 PM, America’s Tax Solutions™ will present a webinar that discusses the real and perceived benefits and challenges of offering a more robust financial services solution. Attend this one-hour educational web-based seminar to hear more about the research findings. You will also learn:

• How to produce higher client satisfaction/better client relationships
• How tax professionals are using financial services to drive revenue and profitability
• How America’s Tax Solutions™ can overcome concerns about time and staffing through partnership and planning
• Why the expertise and skills needed to offer financial services are well within a tax professionals grasp

Please join the President and Founder of America’s Tax Solutions™ as he sheds light on the real and perceived experiences and concerns of tax professionals with and without financial services offerings.

Thursday, June 9, 2016

12:30 pm - 1:30 pm PST

REGISTER NOW AT: https://attendee.gotowebinar.com/register/7032282132603949316

What is an HSA?

In short, certain individuals with high deductible health plans may establish and contribute to a tax-advantaged health savings account (“HSA”). Distributions from an HSA are used to cover qualified health and medical expenses. Contributions to an HSA may come from the individual, the individual’s employer, a family member or any other person. Some of the potential advantages are: HSA contributions are tax-deductible, HSA distributions for qualifying health/medical expenses are not taxable and the interest is not

taxable. To be eligible for an HSA, you must meet the following requirements:

• You must be covered under a high deductible health plan
• You have no other health coverage except what is permitted under IRS rules
• You are not enrolled in Medicare
• You cannot be claimed as a dependent on someone else's tax return
• According to the IRS, “Under the last-month rule, you are considered to be an eligible individual for the entire year if you are an eligible individual on the first day of the last month of your tax year (December 1 for most taxpayers)."

For more detailed information on HSAs, see IRS Publication 969. You may access IRS Publication 969 through the IRS website at www.irs.gov.

Leveraging Your Competitive Advantage

Why do your tax clients keep asking you for financial advice? Because you have a deep understanding of

their overall financial situation, and they already trust you to guide them in the right direction. So, the real question is: why haven’t you added financial services alongside your tax practice?

You’ve built a successful tax practice, but how are you leveraging your deep knowledge of your clients’ financial situation to support their growing need for the level of objective and holistic advice you can provide? While you use the 1040 to provide clients with tax advice, it can also be leveraged to identify broad range of financial needs. That makes offering financial services a natural extension of your tax practice.

America’s Tax Solutions™ is looking for CPAs, EAs, and Tax Professionals to join our growing organization designed for accountants interested in building a wealth preservation component to their existing tax practice. We are America’s leader working with accountants to serve their clients best interest and grow their revenue exponentially.

Let’s be honest, most investment planners are unaware of the tax implications associated with certain investment decisions. You see it every year. Nor do they have a full view of a client’s financial statement. That’s why your tax knowledge makes you an ideal solution for offering financial services. Considering the tax equation when working on a financial plan gives you a unique advantage and, more importantly, helps your clients better manage their financial future. At America’s Tax Solutions™ were committed to helping you leverage this knowledge to your advantage and our model proves it.

Top 5 Reasons to Add Financial Services to Your Tax Practice

• Increase value to clients
• Increase income to your practice
• Provide a single source of expertise for clients and remain competitive
• Increase client retention and referrals
• Establish recurring and diversified revenue streams

America’s Tax Solutions™ offers an exclusive model customized to your needs as a tax professional. We understand the unique needs of tax professionals. That’s a leading reason why we’ve successfully helped scores of tax professionals realize their potential through adding financial services to their tax practices. Best of all, we provide a road map and all the support you need to get started today, including:

A skilled Wealth Preservation Consultant to help you establish these strategies inside your practice.

• Training focused on effectively integrating your tax and financial practices
• Professional development opportunities outside of tax season
• Full acceptance of your tax practice

We recognize taxes are your priority. As a result, we’ve built our support model around your unique needs:

• We offer extended hours during tax season
• All training is scheduled outside of tax season
• Our consultants understand taxes – you don’t have to educate us
• We have unique and proprietary tools designed specifically to help you leverage the tax return

Interested in learning more? We are conducting an informative 30 minute webinar Monday June 6th at 12:00 PM Pacific/3PM EASTERN. Please join us by registering using the following link.

https://attendee.gotowebinar.com/register/3063108928001615364

CPA Direct Announcement

Are your concerns about offering financial services to tax clients limiting your competitive edge?

As trusted advisors, clients often look to their accountants for guidance and advice on a wide range of tax related and financial issues. But not all firms can offer a full solution to their clients, thus missing out on important business opportunities and a competitive edge. During a recent survey conducted by Accounting Today, they spoke to tax professionals who offer financial services to their clients as well as those who don’t. On Thursday, June 9th at 12:30 PM, America’s Tax Solutions™ will present a webinar that discusses the real and perceived benefits and challenges of offering a more robust financial services solution. Attend this one-hour educational web-based seminar to hear more about the research findings. You will also learn:

• How to produce higher client satisfaction/better client relationships.
• How tax professionals are using financial services to drive revenue and profitability.
• How America’s Tax Solutions™ can overcome concerns about time and staffing through partnership and planning.
• Why the expertise and skills needed to offer financial services are well within a tax professionals grasp.

Please join the President and Founder of America’s Tax Solutions™ as he sheds light on the real and perceived experiences and concerns of tax professionals with and without financial services offerings.

REGISTER HERE