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Information provided on this page is informational only. Nothing posted here should be considered investment advice. Please review your financial situation with a qualified financial professional before taking action. For more information please see our disclosure.

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The Importance of Retirement Tax Planning – Why Tax Planning in Retirement Is Just as Important as When You’re Working

In financial media, there is significant chatter about saving for retirement and utilizing ways to reduce your taxable income during your working years. But what often gets neglected are the discussions surrounding taxes in retirement, which, in many cases, are even more complex than when you’re working. With Medicare premium surcharges, Social Security brackets, estate taxes, required minimum distributions, and withdrawal decisions from tax-deferred, tax-free, and taxable accounts, juggling all these different items can be incredibly challenging.

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Can I keep my HSA after I retire?

My colleague Nick Prigitano, CFP®, wrote about when you should file for Medicare, but what happens to your Health Savings Account (H S A) after you retire? We love HSAs due to the triple tax benefits associated with contributing to an HSA. To summarize, you can take a tax deduction for the contribution (which never phases out at any income level), the money can be invested and grows tax-free, and there is no tax when you withdraw the money to pay for qualified medical expenses. Of course, to be able to contribute to an HSA in the first place, you must be enrolled in an HSA-eligible health plan that has “HSA” in its name.

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Contribution Limits for Retirement Accounts in 2022

As financial planners, we obviously adore retirement accounts and saving for the future. What makes these accounts so great are the tax rules associated with contributing money to them. You can either get a tax deduction today (but pay taxes later when you withdraw the money), or you can skip the deduction now and know that the money invested will grow tax free going forward. The tax benefits are so appealing that there are contribution limits to these various retirement accounts. Every year, the IRS reviews these limits, and financial planners everywhere wait with great anticipation to see whether these limits will increase in the coming year. Well, the numbers for 2022 are out....

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What to Know About the Healthcare Exchange Open Enrollment and Tax Credit for 2021

Health insurance open enrollment comes around the same time every year. Last week, we wrote a post about open enrollment for those people who are already on or who are going to soon be on Medicare. This week we’re going to review open enrollment for the health insurance exchanges. Having adequate health insurance is a foundational part of any complete financial plan. Many people are offered health insurance coverage through their employer or, if they are old enough, from Medicare. It gets a little more complicated for self-employed people or for those who are currently out of a job.

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Medicare and Me? Making the Most of Open Enrollment

The annual open enrollment period for Medicare started on October 15 and goes until December 7. It is the one time every year that Medicare beneficiaries have an opportunity to modify their Medicare coverage. During the open enrollment period, you can switch or add a Medicare Advantage plan, switch or add a Part D prescription drug plan and, in some states, like Massachusetts, switch or add a Medigap plan. Any changes that you make take effect on January 1 of next year. We’ll try and cover the basics to give you a general understanding of Medicare and your options during the open enrollment period.

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Generosity: Making Tax-Efficient Gifts to Individuals

What makes people happy, content and fulfilled? More money and more stuff can give a temporary boost to someone’s mood, but it can’t make them truly happy. Financial contentment is understanding that money and things are not what provide fulfillment. What makes most people happy is having a sense of purpose, having a sense of contentment, spending time with family and friends, and making a difference in the world. Today we are going to discuss why you should give—and how to give—to individuals in a tax-efficient way.

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Holiday Shopping in 2021 — Supply Chain Troubles, and Why You Should Be Getting Your Gifts Now!

Although the leaves have just turned and started to fall and the first snow of the season has yet to arrive, economic experts can already hear the Christmas bells in the distance. Last year, we wrote a post about the holiday shopping season starting earlier, and it appears that 2021 will be much of the same, if at least partially for different reasons. If you haven’t started thinking about getting gifts for the holiday season, although it’s only October, now is probably a good time to start. There are significant supply chain issues that are already impacting retailers, and those who start their shopping earlier are likely to come out ahead this year. Here’s what you should know about the holiday shopping season and the headwinds facing retailers in 2021.

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FAFSA Changes Ahead: What to Know about the FAFSA Simplification Act

On December 27th, 2020, the FAFSA Simplification Act was passed as a part of the larger Consolidated Appropriations Act. The new legislation included several changes to the financial aid process and the FAFSA form. Parents who have had to fill out the FAFSA form in the past understand how overwhelming it could be, as the old form had 108 different questions and was 8 pages in length. To help decrease the instances of families choosing to just skip filling out the FAFSA altogether, legislators worked to streamline the form and, in the process of doing so, made several other notable changes to federal student aid determination.

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End of the Backdoor Roth? New Tax Law Proposal Aims to Quash This Powerful Retirement Savings Move

An incredibly wise man, Benjamin Franklin, once said, “In this world nothing can be said to be certain except death and taxes.” While there isn’t anything we as financial planners can do about death, one of our main goals is to help our clients reduce their total lifetime taxes paid. One of the best ways to accomplish this is to contribute money to a Roth retirement account (either a Roth IRA or a Roth 401(k)). The trouble with this is that not everyone is eligible to contribute to a Roth IRA directly or has an employer that offers a Roth 401(k) option. In these instances, another avenue to pursue is evaluating whether it makes sense to do what’s called a backdoor Roth contribution instead.

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Generosity: Making Tax-Efficient Gifts to Charity

Many people like to donate to charity. Often, people will write checks or make an online donation to a variety of charities throughout the year. Since most people now take the standard deduction instead of itemizing their deductions on their tax return, they usually don’t get the maximum bang for their buck by donating in this fashion.

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What Can I Do with a 529 Plan if My Child Doesn’t Need It?

During this back-to-school season, parents are covering their children’s education expenses by dipping into the accumulated balances in their 529 plans. These parents who saved for their children’s education costs are benefiting from the tax-free compounding that 529 plans provide. Even with the high cost of education, some parents may find that they have excess savings in the 529 plans they have set up for their children. Over-saving, unexpected scholarships, children deciding not to attend college, and the total cost of education being lower than expected are all reasons why this might happen.

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Will Your Federal Student Loan Be Forgiven?

Federal student loan borrowers have been afforded some relief during the pandemic, starting in March 2020 when all federal loans went into automatic forbearance. This relief is coming to an end on January 31, 2022, but questions remain about whether the Biden Administration or Congress will follow through with proposals made to forgive $10,000 or more of the federal student loans of all borrowers of that amount. In the meantime, the Department of Education has been working on other initiatives to make already existing student loan forgiveness programs easier to take advantage of.

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