Take-Away: The direct payment of another individual’s medical expenses is not treated as a taxable gift. Unlike the direct payment of tuition, the direct payment of medical expenses is much more broadly defined. Background: As previously reported, the direct payment of another individual’s tuition obligation is not treated as a gift, and thus not subject to […]

Take-Away: The purchase of a qualified longevity annuity contract using an IRA’s assets is not a wise move just  to delay taking, or reducing,  required minimum distributions. Background: Several years ago Congress amended the Tax Code to permit the use of a portion of an IRA or 401(k) account to purchase a qualified longevity annuity contract. […]

Take-Away: With much of the tax reform being talked about in Congress this past spring and this summer, little has been said about the possible impact of some of the tax proposals on philanthropy. Some planning options may be curtailed, yet others will continue to exist, and may even present better tax-saving opportunities if income […]

Take-Away: As we await Congress’ return to session this fall and its annual task of establishing a budget for fiscal year 2021-2022, not only will income tax increases be on everyone’s mind, but also possible changes to the rules with regard to retirement plans, plan contributions,  and possibly the income tax deduction that is associated […]

Take-Away: As individuals start to seriously consider higher income taxes they may face in their retirement years, more attention is being given to Roth IRAs, Roth conversions, and ‘back-door’ Roth IRA conversions using after-tax contributions. In some circumstances, it might be possible to contribute substantial amounts to a Roth account each year using a  Roth […]

The following are the applicable federal rates of interest for September, 2021: Short-term rate (0- 3 years):              0.17% Mid-term rate    (3 to 9 years):            0.86% Long-term rate  (9 years or longer): 1.73% (annual interest) 1.72% (semi-annual or quarterly interest) and 1.71% (monthly interest) […]

Take-Away: As we await Congress’ return to session this fall and its annual task of establishing a budget for fiscal year 2021-2022, not only will income tax increases be on everyone’s mind, but also possible changes to the rules with regard to retirement plans, plan contributions,  and possibly the income tax deduction that is associated […]

Take-Away: With much of the tax reform being talked about in Congress this past spring and this summer, little has been said about the possible impact of some of the tax proposals on philanthropy. Some planning options may be curtailed, yet others will continue to exist, and may even present better tax-saving opportunities if income […]

Take-Away: Just because an individual is diagnosed with dementia, or they have a court appointed conservator, does not automatically mean that the individual does not possess  testamentary capacity to sign either a valid Will or Trust. Background: Testamentary capacity to sign a Will is described in the Estate and Protected Individuals Code (EPIC.) If over […]

Take-Away: Beginning in 2022 the IRS will begin using longer life expectancies to calculate required minimum distributions (RMDs.)With longer life expectancies, annual RMD amounts will drop between 0.3% to 0.5%. Background: Lifetime RMDs which are taxed as ordinary income must be taken from an individual’s retirement account each year beginning in the year that the […]