If you or your spouse anticipate the need for nursing home care in the future, and particularly if you’re concerned about how you’ll finance that care, you’ll likely want to meet with an elder law attorney sooner rather than later. Given the strict rules that govern Medicaid qualification, the absolute best case scenario is to start planning to qualify for the program at least five years before you actually need apply for benefits. Medicaid imposes a five year “look back” period, which means … [Read more...] about Qualifying for Medicaid: Timing is Everything
At a recent awards ceremony, Jackie Chan told the press that he intends to leave his entire estate to charity, and leave nothing to his son, singer Jaycee Chan. “If he is capable, he can make his own money. If he is not, then he will just be wasting my money,” Chan said. This stance actually reflects the feelings held by more than a few wealthy Americans. When U.S. Trust surveyed a group of 457 individuals with investable assets of more than $3 million, only 49 percent said that passing assets … [Read more...] about How’s This for Tough Love?
If you’re among the dwindling minority of Americans who can rely on a pension when you retire, you might wonder whether you’ll be able to collect your full social security retirement benefit, too. For most people, the answer to this question is “yes”, but it depends on whether you’ve always worked for an employer that participates in the social security system. There are certain government agencies, nonprofits, and foreign employers that don’t pay Social Security tax on behalf of their … [Read more...] about What is the Windfall Elimination Provision?
The revocable living trust is a flexible and useful estate planning tool with many benefits to offer; however, it has its limits. For instance, did you know that – contrary to a popular myth – simply establishing a revocable living trust does not protect you and your assets from creditors, or from a divorcing spouse? Trust Property is Treated Like It’s Yours Since the trust is revocable, meaning that you retain the power to change or eliminate the trust in its entirety at any time, the assets … [Read more...] about Is a Revocable Living Trust a Good Asset Protection Tool?
As parents, we want the absolute best for our children. That’s why estate planning can be especially difficult for parents of children who are still too young to take care of themselves. It can be daunting to name a guardian to step in and handle the care and upbringing of your children if you can’t be there. And then there’s the concern of who should manage the inheritances you plan to leave behind. Minor children aren’t legally permitted to manage significant amounts of money for … [Read more...] about Placing Your Kids in Good Hands
What do you plan to do with your tax refund this year? Here are three suggestions that could net you long-term benefits: Reduce Your Debt: If you have credit card bills or other consumer debt hanging over your head, consider putting your tax refund to work by using it to pay down those debts. Not only will this reduce your current monthly bills and free up some cash, getting out of debt and staying out of debt can put you in a better position when the time comes to retire. Pay Down Your … [Read more...] about Three Smart Uses for Your Tax Refund
A Limited Liability Company (LLC) is treated by the IRS as pass-through entity. Unlike a corporation, which must file its own, separate income tax return, the owners of an LLC (“members”) report the company’s profits or losses on their personal income tax returns. Here are the default rules: Single-Member LLC: An LLC that has only one member is treated by the IRS as if it were a sole proprietorship. So, there’s no separate LLC tax return, and the LLC as a business entity does not have to pay … [Read more...] about How is an LLC Taxed?
If you have a Roth IRA, and you’re unlikely to need to tap into the account for retirement income, your IRA can serve as a vehicle for leaving an inheritance to your loved ones. Here’s how it works: Tax-Free Growth Contributions to a Roth IRA are made with after-tax dollars. Since you’ve already paid income tax on the money going into the account, the IRS allows that money to grow, tax-free – if you chose to withdraw money from your Roth during your retirement, you’d owe no income tax, even on … [Read more...] about The Roth IRA as an Estate Planning Tool
A traditional IRA can be an excellent retirement savings tool, particularly if your earnings are too high for you to contribute to a Roth IRA or you don’t have the opportunity to invest in a 401(K). A traditional IRA allows your retirement contributions to grow tax-free, and in many circumstances your contributions to the account are tax deductible, too. There are some limits to the amount you can contribute to a traditional IRA in any given year. First, you can only contribute up to the … [Read more...] about Traditional IRA Basics
Unlike a traditional IRA, which offers tax-deferred growth for your retirement savings, a Roth IRA offers tax-free growth. Your contributions are not tax deductible, but after you reach age 59 ½ , the distributions you take from your Roth are not taxed – and this includes the money that initially went into the account as well as the interest earned on those funds. There are some pretty strict restrictions on who can contribute to a Roth IRA, and how much can be contributed each year. First, the … [Read more...] about Roth IRA Basics