Articles

Charitable donations from your IRA could save taxes

Congress has revived a law that lets you make charitable donations directly from your IRA, which might provide you with some significant tax advantages. The “IRA charitable rollover” was discontinued at the end of 2014. But Congress has now resurrected it, made it permanent, and also made it retroactive to the beginning of 2015. If you’re over the age of 70½, you’re required to take minimum distributions each year from your IRA, and you have to

‘Spendthrift trust’ gets divided at divorce

Even though a wealthy family put assets in a trust for their children in order to protect them from creditors, a child’s interest in the trust could be divided in a divorce, says the Massachusetts Appeals Court. While this result is unusual, it goes to show that even a solid spendthrift trust might not be perfect if a creditor – in this case, a spouse – is sympathetic enough. Curt Pfannenstiehl was a beneficiary of a

Financial advisors have more responsibility to clients

Stockbrokers, financial planners and insurance agents who provide advice regarding IRAs and other retirement accounts will have new responsibilities toward clients, and the way they bill their clients may change, under new rules announced by the U.S. Labor Department. Under the rules, advisors must now act in their clients’ best interests when they make recommendations. In the past, many advisors merely had to make recommendations that were “suitable” for a client, even if what they recommended

New problem for some executors and heirs

Executors who have to file a federal estate tax return, and some heirs who receive assets from an estate that is subject to the federal estate tax, may be facing a significant new problem as a result of rules just issued by the IRS. The problem only affects larger estates – generally those where the deceased person’s assets, large lifetime gifts, and life insurance proceeds total more than $5.45 million. But for those estates, it’s a

Be careful if different people handle your finances and health care

It’s not uncommon for seniors to name one person in their power of attorney document to handle their finances if they become incapacitated, and to name someone else to make decisions for them in their health care proxy. For instance, a senior might live with one child or be very close to him or her, and trust that child to make medical decisions – because the child is familiar with the senior’s day-to-day health issues. On

Social Security can be seized to pay debts – sometimes

If you don’t pay your debts, creditors can generally obtain a court order to garnish your wages. But what if your income comes from Social Security? In that case, the answer is a bit more complicated. For most types of debts (including credit cards, medical bills, and personal loans), Social Security benefits cannot legally be garnished to pay them off. But how this actually works in practice can be tricky. Suppose you receive $1,500 a month

Long-term care premiums dip for men, rise for women

On average, long-term care premiums are decreasing for men and increasing for women, according to a study by the American Association for Long-Term Care Insurance, an industry trade group. For instance, a healthy 55-year-old man can expect to pay an average of $1,015 annually for a new policy offering $164,000 in long-term care benefits, which is down 4.2 percent from last year, according to the group. But for a woman in the same situation, the average

Medicare now covers conversations about end-of-life care

Did you know that 40 percent of people over age 65 haven’t written down their wishes regarding life support and other end-of-life treatment? One reason for this may be that people haven’t had a conversation with their doctor about the options that are available. In the past, Medicare didn’t cover these doctor-patient conversations – except during the patient’s initial “Welcome to Medicare” visit, a time when the topic might not seem very relevant. Under new regulations,

What you need to know if you’re an agent under a power of attorney

If someone has named you as an agent under a durable power of attorney, you’ll be allowed to handle that person’s finances. (The person who signs the power of attorney is known as the “principal”; you’ll be known as the agent or “attorney-in-fact.”) Here are answers to some questions you might have: What are my duties? You’re responsible for handling the principal’s financial affairs. Generally, you can step into his or her shoes and take whatever investment

Your business may qualify for this extended tax break

The Work Opportunity Tax Credit gives employers a tax credit for hiring veterans and others who are members of “target” groups. Normally, you have 28 days after an eligible worker’s first day to complete the necessary paperwork for the credit. But the 28-day rule has been extended for some new workers that you hired between January 1, 2015, and May 31, 2016. For certain employees hired within that time period, the deadline for filing the required

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