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Category: Tax

Gifts Could Expose Children or Grandchildren to the Kiddie Tax

By Lineweaver Financial Group
July 11, 2016 Category • Newsletter, Tax, Gifting

We are all familiar with the rules about gifting to children and grandchildren- the $14,000 per person per recipient annual limits, but often overlooked are other potential consequences. Accumulated gift can expose kids to the kiddie tax. Congress enacted the kiddie tax in 1986 to prevent people from putting assets in their childrens names to avoid taxes, as children often have far lower tax rates than their parents. Under the rules, a childs unearned investment income, such as dividends, interest, and capital gains above $2,100 in 2016 is taxed at the parents top rate. So if the parents dividends are taxable at 23.8%, the childs dividends are as well, even if the childs rate would otherwise be 0%. Originally the kiddie tax applied to children under age 14. Over time lawmakers have expanded it to cover virtually all children under 19 and many who are older, including full-time students up to age 24 if they can be claimed as dependents on a parents return. Under the rules, the first

Congress Makes Charitable Contributions from IRA’s Tax Free. Forever!

By Lineweaver Financial Group
February 04, 2016 Category • Retirement Planning, Financial Planning, Charitable Contributions, Tax

Are you at least 70 , and want to build regular charitable contributions into your legacy plan using excess funds in your IRA? In the past, you had to worry that the government might decide that donation was considered taxable income, which meant you would either had to either contribute more to cover the shortfall or give simply give less. The good news is you never have to worry about that again because the Federal Government has made a permanent change to IRA gifting. Starting 2016, charitable donations of up to $100,000 per year made from your IRA funds are no longer subject to any tax because the donation is excluded from your taxable income. That means, for those of you so inclined to give-back, you can integrate a regular annual donation into your retirement plan. And, since the law refers to Individual Retirement Accounts, your spouse can do likewise with his or her IRA funds. A little good news for your kids. Theres also a provision in the new law that you might want to mention

1099s and K-1s- When to Expect Them

By Lineweaver Financial Group
January 07, 2016 Category • Tax, Newsletter

Below is a table of common forms, the reasons you would receive them, and when you can expect these forms. Form You Should Receive This Form If: When Should You Expect This Form? 1099-R: Distributions from Pensions, Annuities, Retirement or Profit Sharing Plans, IRAs, Insurance Contracts, etc You received $10 or more from your IRA or one of the other sources of retirement income. After February 1, 2016 1099-B You sold stocks, mutual funds, bonds, or other securities in a non-IRA account After February 16, 2016 1099-DIV: Dividends and Distributions You own a stock or mutual fund that pays dividends. After February 1, 2016 1099-INT: Interest Income You have a checking, savings, or other bank account that earns interest After February 1, 2016 If you have not received the 1099s you expected by the middle of February, feel free to call our office and well be happy to assist you! Also keep in mind, the deadline for S-Corp companies

Year End Tax Tips

By Lineweaver Financial Group
November 02, 2015 Category • Tax, Education Programs, Retirement Planning, Financial Planning

There are some basic tried and true tax planning tips that can be applied each and every year. While these may not be new and exciting, they are highly effective and proven to minimize your tax bill. Here is a brief highlight of the tax planning maneuvers you should still be considering for 2015: Defer Income: Income is taxed in the year it is received. If possible defer year-end bonuses from employers to 2016 if you feel that income will place you in a higher tax bracket in 2015. If you are self-employed you may consider delaying billings until late December so that the payments are not received until 2016. Also consider accelerating income into 2015 if you feel you will be in a lower tax bracket in the current tax year. Bunching Itemized Deductions: Consider paying real estate taxes due in early 2016 in 2015, pay medical bills ahead, or make charitable deductions earlier to enable you to get past the itemized deduction threshold in 2015. Charitable Deductions: You may wish to consider

2016 Presidential Election- Federal Tax Reform

By Lineweaver Financial Group
October 12, 2015 Category • Tax, Newsletter, Education Programs

It has been an interesting campaign season thus far with many hopeful candidates throwing their hats into the presidential ring. Throughout the last few months, candidates from both parties have put tax policy at the center of their platforms. All of the candidates promise that their version of tax reform will make the federal tax system simpler, fairer, and better for the economy. This article will attempt to explain the basic differences in the three types of federal tax reform being debated by the candidates. The three types of tax policies we will discuss are: 1) our current tax system, 2) a Flat Tax system, 3) a national sales tax system also known as FairTax. Each of the candidates has his or her spin on either changing our current system or implementing a Flat Tax or FairTax. Our objective is to make you aware of the basics of each system so that you may apply that understanding to each of the candidates specific tax reform plans. Our current system is known as a progressive income

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