We’ve created a Client Alert that discusses Greece and the European debt situation and the implications for financial markets in general. It reviews how the situation got to this point, the potential scenarios for Greece and Europe, and how the markets might be affected going forward. To read more, visit http://www.forefield.com
Broadridge Alert: New Client Alert provides an overview of Medicare Access and CHIP Reauthorization Act of 201
On April 16, 2015, the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) became law. This act changes certain Medicare provisions and extends funding for the Children’s Health Insurance Program (CHIP). This new law enhances health-care quality and cost control initiatives. It also authorizes and funds the removal of Social Security numbers from all Medicare cards, offering greater protection to individuals whose Medicare cards are lost or stolen. Moreover, the act subsidizes Medicare premiums as well as adjusts income-related premiums for Medicare Parts B and D. These new income limits (thresholds) will take effect in January 2018, subjecting some Medicare beneficiaries to higher income-related premium adjustments.
But in the meantime, clients and their families may be interested in specific details, so we’ve created a Client Alert that provides an overview of the new legislation.
Log in to forefield.com to read the full Client Alert and distibute to your clients and prospects.
On April 14 the U.S. Department of Labor released its much-anticipated proposed rules detailing how ERISA’s fiduciary obligations apply to those providing investment advice to IRA owners and qualified plan participants.
In its news release announcing the new rules, the DOL stated: “Under the proposals, retirement advisers will be required to put their clients’ best interests before their own profits. Those who wish to receive payments from companies selling products they recommend and forms of compensation that create conflicts of interest will need to rely on one of several proposed prohibited transaction exemptions.”
These new proposals are likely to garnish as much attention and comment as the DOL’s last attempt to redefine the fiduciary rules back in 2010.
To read the new proposed rules, visit http://www.dol.gov/ebsa/regs/conflictsofinterest.html
An employer-sponsored retirement savings plan is one of the most convenient ways to help build a nest egg for retirement. However, many employees might not be aware that participating in their plan helps benefit their tax situation, too. Broadridge Advisor Solutios has created a concept video that helps explain the potential tax benefits of plan participation, covering the advantages of both traditional pre-tax and Roth accounts. To view the video, or to sign up fo rfree access to all of our content, log into http://www.forefield.com
As December drew to a close, last-minute legislation retroactively extended more than 50 expired federal tax provisions through 2014—but left their status uncertain for 2015. These eleventh-hour changes left little time to react, since the window of opportunity generally closed on December 31, 2014. Nevertheless, you might benefit from one or more of the provisions when you complete your 2014 federal income tax return. Log in to http://www.forefield.com to view the full video.
In one of its final actions, the 113th Congress passed the Tax Increase Prevention Act of 2014. This legislation extends for one year a host of popular tax provisions (commonly referred to as “tax extenders”) that had expired at the end of 2013. All of the following provisions were among those retroactively extended, and are now effective through the end of 2014.
Deduction for qualified higher-education expenses
You may be entitled to a deduction if you paid qualified higher-education expenses during the year–this includes tuition and fees (for yourself, your spouse, or a dependent) for enrollment in a degree or certificate program at an accredited post-secondary educational institution. The deduction doesn’t include payments for meals, lodging, insurance, transportation, or other living expenses. The maximum deduction is generally $4,000. However, if your adjusted gross income (AGI) exceeds $65,000 ($130,000 if married filing jointly), your maximum deduction is limited to $2,000; if your AGI is greater than $80,000 ($160,000 if married filing jointly), you can’t claim the deduction at all.
Deduction for classroom expenses paid by educators
If you’re an educator, you may be able to claim up to $250 of unreimbursed qualified classroom expenses you paid during the year as an “above-the line” deduction. Qualifying expenses can include the cost of books, most supplies, computer equipment, and supplementary materials used in the classroom. Teachers, instructors, counselors, principals, and aides for kindergarten through grade 12 are eligible, provided a minimum number of hours are worked during the school year.
Deduction for state and local general sales tax
If you itemize deductions on Schedule A of IRS Form 1040, you can elect to deduct state and local general sales taxes in lieu of the deduction for state and local income taxes. You can calculate the total amount of state and local sales taxes paid by accumulating receipts showing general sales taxes paid, or you can use IRS tables. If you use IRS tables to determine your deduction, in addition to the table amounts you can deduct eligible general sales taxes paid on cars, boats, and other specified items.
Tax-free charitable donations from IRAs
If you’re age 70½ or older, you can make a qualified charitable distribution (QCD) of up to $100,000 from your IRA and exclude the distribution from your gross income. The distribution must be made directly to a qualified charity by December 31, 2014, and must be a distribution that would otherwise be taxable to you. QCDs count toward satisfying any required minimum distributions (RMDs) that you would otherwise have to receive from your IRA, just as if you had received an actual distribution from the plan. You aren’t able to claim a charitable deduction for the QCD on your federal income tax return.
Deduction for mortgage insurance premiums
Premiums paid or accrued for qualified mortgage insurance associated with the acquisition of your main or second home may be treated as deductible qualified residence interest on Schedule A of IRS Form 1040. The amount that would otherwise be allowed as a deduction is reduced if your AGI exceeds $100,000 ($50,000 if married filing separately), and no deduction is allowed if your AGI exceeds $109,000 ($54,500 if married filing separately).
You may be able to claim an additional first-year “bonus” depreciation deduction, equal to 50% of the adjusted basis of qualified property placed in service during the year. The additional first-year depreciation deduction is allowed for both regular tax and the alternative minimum tax. The basis of the property and the regular depreciation allowances in the year the property is placed in service (and later years) are adjusted accordingly.
Expanded IRC Section 179 expensing limits
Under IRC Section 179, if you’re a small-business owner you can generally elect to expense the cost of qualifying property, rather than to recover such costs through depreciation deductions. The maximum amount that can be expensed for 2014 now remains at $500,000 (the same limit that applied in 2013), rather than dropping to $25,000 had the legislation not passed. The $500,000 limit is reduced by the amount by which the cost of qualifying property placed in service during the taxable year exceeds $2,000,000.
Exclusion of gain–qualified small-business stock
Generally, you’re able to exclude 50% of any capital gain from the sale or exchange of qualified small-business stock provided that certain requirements, including a five-year holding period, are met. However, the temporary increase of the exclusion percentage to 100% that applied in 2013 is now extended to qualified small-business stock issued and acquired in 2014.
Other provisions extended
Other provisions extended by the legislation include:
•The ability to exclude from income the discharge of debt associated with a qualified principal residence
•Provisions related to employer-provided mass-transit benefits
•Special rules for qualified conservation contributions of capital gain real property
•Provisions relating to business tax credits, including the research credit and the work opportunity tax credit
For more advisor visit http://www.forefield.com
A major provision of the Patient Protection and Affordable Care Act (ACA) was the creation of state-based and federal Health Insurance Exchanges for individuals and Small Business Health Options Programs (SHOPs) for small businesses. Beginning November 15, 2014, enrollment in Health Insurance Exchanges and SHOPs will be available. The open enrollment period ends February 15, 2015.
Individuals and small business owners can use Health Exchanges and SHOPs to compare health plans for benefits and price, and select a plan that fits their needs. Coverage begins the first day of the next month for those enrolling between the 1st and 15th days of the month; otherwise, coverage starts the first day of the second following month. So if an individual enrolls on January 16, coverage begins March 1.
To learn more about Health Exchanges and SHOPs, you can refer to the government site, http://www.healthcare.gov. In addition, our Health-Care Reform Resource Center has information you can use to educate your clients and prospects about the Health Exchange programs.