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

The Battle Over Retirement Accounts: Spousal Waivers and IRAs

You are married and have an IRA. You know you need to name a beneficiary for those funds. But what if you do not want to name your spouse as the beneficiary? Are you required to name him or her? Under federal law, and IRAs are governed mostly by federal law, you are not required to name your spouse as your IRA beneficiary. You can name anyone you want as the beneficiary. They don’t even have to be a relative.

State law will have some impact here, though. If you live in a community property state, you will most likely need to have your spouse sign a waiver before you can name a non-spouse beneficiary for your IRA funds. In some states, you can “disinherit” your spouse by naming someone else on the beneficiary form, but the spouse could have the last laugh. Some states allow a disinherited spouse to make a right of election against the estate and the spouse would then end up with some of your assets. He or she could then laugh all the way to the bank.

In most employer plans, if you are married and want to name someone other than your spouse as the beneficiary of your plan benefits, you must have your spouse sign a waiver.

 Be careful who signs the waiver. It must be a spouse. Documents signed by a fiancé, such as a pre-nuptial agreement, do not count. Once a spouse signs a waiver, update the beneficiary form. You should do both steps to ensure that your assets go to the beneficiaries that you select.

 Divorce decrees also don’t count. A spouse can waive rights to retirement benefits in a divorce decree, but as long as a beneficiary form naming the spouse remains in place, that spouse – now the ex-spouse – will, in most cases, end up with the retirement benefits. Always update beneficiary forms after a divorce.

 Beneficiary form reviews should be a key component of your financial plan, whether you are your own planner or you have a professional doing this for you. You can see how something that seems so simple can quickly become complicated.

My Plan Custodian Will Only Issue a Check, Now What?

Checks Issued Could Still Qualify as a Trustee-to-Trustee Transfer…

If you want to do a direct transfer (trustee‐to‐trustee transfer) but your current IRA custodian or plan administrator will only issue a check, all hope is not lost. If a check is made payable to you, that transaction will trigger the 60‐day rollover rules. In addition, if the check is not from your IRA but is issued by a qualified employer plan such as your 401(k) for example, the issuance of the check usually triggers a mandatory 20% withholding.

How Can You Fix This Problem?

If the plan will not do a trustee-to-trustee transfer (sometimes called a direct rollover) to an IRA or eligible retirement plan and you are told they must issue you a check, there is a work around. The check may still qualify as a trustee‐to‐trustee transfer if the check is made out directly to the receiving IRA instead of you, the IRA owner. Regulation Section 1.401(a)(31)‐1, Q& A‐4 tells you exactly how to make the check out so that the transaction qualifies as a direct rollover.

Source: www.irs.gov

Reviewing Estate Plans

Articles in popular publications routinely warn readers about the very thing we have been telling our clients for years: review your estate planning documents at least once per year!

BASIC ESTATE PLANNING DOCUMENTS INCLUDE:

• Wills
  
• Trusts
• Beneficiary Forms
• (Insurance, Retirement Plans, Accounts)
• Powers of Attorney
• (Durable, Health Care Directives)
• Letters of Instruction
• (For Your Trustee, Executor and/or Heirs)
• Anything Else You Have to Provide For and Protect Your Loved Ones!

Failure to review estate planning documents can spell disaster for your beneficiaries yet this failure is surprisingly common. One example is a client who recently discovered that the trust her husband set up contains provisions that conflict with their most recent financial plan and distribution goals.

Unfortunately, he passed away and she is now stuck with the flawed trust terms. The trust was drafted about 25 years ago but they never reviewed the trust terms despite the fact that several life changing events occurred and their planning strategies changed. Sadly, this oversight resulted in irreparable and unintended results for their beneficiaries.

Even though you cannot predict what will happen and when it will happen, you can adjust your estate plan as needed. Make sure you consult with your personal Wealth Preservation Consultant, accountant, attorney or other professional advisor when any life changing event occurs or new legislation affects your tax and estate planning. Always ensure your assets flow the way you want them to and in the most tax efficient manner.

RMD Basics for IRA Owners

If you own or are the beneficiary of an IRA, 401(k) or other retirement plan, make sure you don’t make an RMD (required minimum distribution) error. Failure to take at least the RMD amount each year results in a 50% penalty imposed by the IRS! Keep in mind that beneficiaries who inherit IRAs have different rules so you will need to contact your retirement distribution expert for more information about rules specific to IRA beneficiaries.

• IRA owners must take their very first RMD no later than April 1st of the year following the year they turn 70½. So if you turn 70½ in 2016, your required beginning date is April 1, 2017. However, if you choose to delay your very first RMD until 2017, you will need to take two RMDs in 2017 – your first RMD and your regular RMD for 2017.
• You reach age 70½ on the date that is 6 calendar months after the date of your 70th birthday.
• Except for your very first RMD discussed above, all subsequent RMDs must be taken no later than December 31st each year.
• RMDs are generally calculated by dividing the adjusted market value of your IRAs as of December 31st of the preceding year by the distribution period that corresponds with your age in the Uniform Lifetime Table (IRS Publication 590-B).
• You must calculate the RMD amount for each of your IRAs separately. However, if you have more than one IRA (must be the same type), you don’t have to take a separate RMD for each…you can aggregate and withdraw the entire amount from just one IRA of the same type or withdraw a portion from each IRA to satisfy your RMD.
• Failure to take a timely RMD results in a 50% penalty on the undistributed amount. This rule applies to both IRA owners and IRA beneficiaries.
• IRA owners can always withdraw more than the minimum distribution amount… just be prepared to pay the income taxes.