September 28, 2016

Roth IRAs Make Great Estate Planning Tools

at the beach

Taking the smallest distribution each year will ensure the beneficiary achieves the maximum tax-free growth of tax-free income.

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Why Would You Intentionally Realize Capital Gains?

handful of cherries

When you sell an investment that has appreciated, the IRS looks at your tax rate and taxes the gains accordingly.

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Planning for a Funeral

Planning for a Funeral

Funeral expenses are often a family’s fourth largest expense.

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Do Children Need To File A Tax Return To Fund Their Roth IRA?

Do Children Need To File A Tax Return To Fund Their Roth IRA?

The IRS does not require dependents whose gross income is only earned income to file a tax return if the amount is less than a certain amount.

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Understanding Virginia’s Tax Withholding Rules

Understanding Virginia's Tax Withholding Rules

We know how federal rules require you to either have tax withheld or make estimated payments of tax that will be due, but it is easy to forget that states have their own revenue departments and their own rules.

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Understanding the Estate Tax Return

Understanding the Estate Tax Return

The estate tax return is definitely complex, but that’s because it has to account for the multitude of special rules that only apply to a few households.

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Qualified HSA Funding Distribution

Qualified HSA Funding Distribution

There is an obscure tax rule that allows a one-time Traditional IRA-to-HSA conversion called a Qualified HSA Funding Distribution (QHFD).

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Testamentary Donor Advised Funds

colorful gift bows

An easy estate workaround is to set up a Donor Advised Fund as a Testamentary fund, meaning you aren’t funding it yet, but it will be funded upon your death.

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Understanding the Generation-Skipping Transfer Tax

Understanding the Generation-Skipping Transfer Tax

The fact that we have an 80% “generous grandparent” tax is ridiculous.

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Digital Estate Plan: Facebook Legacy Contact

Facebook Legacy Contact

Facebook added the “Legacy Contact” feature that allows you to grant a Facebook Friend access to your Facebook page after you have passed away.

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Free Advanced Medical Directives from the Virginia State Bar

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The Virginia State Bar has even made a few variations of a simplified Advanced Directive free to the public on their website.

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Mailbag: The Practical Limits of 1031 Exchanges

Mailbag: The Practical Limits of 1031 Exchanges

Using a 1031 exchange to turn investment property into residential property is possible, but it takes careful planning from the outset.

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How Cookie-Cutter Powers of Attorney Fail

How Cookie-Cutter Power of Attorneys Fail

This style of Power of Attorney certainly gets the job done, but there are a few ways that the cookie-cutter POA most frequently fails to meet people’s wishes.

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Is Margin Loan Interest Tax Deductible?

Is Margin Loan Interest Tax Deductible?

Margin loan interest is tax deductible, but the amount you can deduct is limited.

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What is a Roth Conversion?

What is a Roth Conversion?

If you don’t have retirement savings in Roth IRAs, it’s time you considered their benefits. Assets in traditional IRAs can be rolled into Roth IRAs without a withdrawal penalty.

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Government Requires 2.5 Hours of Daily Work

Government Requires 2.5 Hours of Daily Work

Without the burden of federal, state, and local taxes, you could leave your job at 2:27pm every day and earn the same salary.

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Radio Interview: The Burden of Government Taxation

Radio Interview: The Burden of Government Taxation

David John Marotta was recently interviewed on radio 1070 WINA’s Schilling Show, discussing taxation and the burden of government.

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Gifts, Taxes, and IRS Form 709

Gifts, Taxes, and IRS Form 709

Most people are unaware that giving a gift can be a taxable event because they themselves have not yet experienced the tax.

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Mailbag: How Is Capital Gains Tax Calculated?

Mailbag: How Is Capital Gains Tax Calculated?

The IRS does not do a good job of helping people understand capital gains taxes. They provide a worksheet to help you calculate it, but it has so many steps that it’s nearly impossible to figure out what’s going on.

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Tax Loss Harvesting and Wash Sales

Tax Loss Harvesting and Wash Sales

Wash sale rules need to be followed when realizing capital losses for taxes but can be burdensome to track and monitor.

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Ted Cruz’s Tax Plan

Ted Cruz's Tax Plan

More than many other candidates, Ted Cruz’s tax plan aims to fundamentally change our tax system.

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Four Things You Can Do with Your Roth Before April 15

beach sprint

If you have not yet funded your Roth account for 2015, it is not too late!

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How Roth Conversions Are Reported to the IRS

How Roth Conversions Are Reported to the IRS

The Internal Revenue Service (IRS) is notorious for misunderstanding the recharacterizations of Roth conversions.

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What Counts as Wages for the Social Security Earnings Test?

What Counts as Wages for the Social Security Earnings Test?

Contrary to the normal way of things, this time what Uncle Sam gives with the IRS, he takes away with the SSA.

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Qualified Charitable Distributions (QCDs) from IRAs

Qualified Charitable Distributions

QCDs allow individuals age 70 1/2 or older to give directly to a charity from your IRA without counting the distribution as taxable income.

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What Counts as “Boot” in a 1031 Exchange?

What Counts as "Boot" in a 1031 Exchange?

1031 exchanges can include “boot,” which is an unofficial term for other property received in the exchange.

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Radio Interview: Wills, Estates, and Beneficiaries

Live Oak

David and host Rob Schilling discuss what estate planning is, why you want to do it, and explain some of the jargon.

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2016 Employer-Sponsored Retirement Account Limits

Retirement Cash Jar

Here are the limits for how much your employer can add to retirement accounts on your behalf.

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Six Creative Beneficiary Designation Ideas

Six Creative Beneficiary Designation Ideas

These are just some examples of the creative beneficiary designations, but the important part is to dream big about what your wishes are.

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After-Tax IRA Contributions Must Be Reported On IRS Form 8606

After-Tax IRA Contributions Must Be Reported On IRS Form 8606

The backdoor Roth strategy involves contributing after-tax funds to a traditional IRA.

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2016 Retirement Plan Limits

Retirement Cash Jar

Knowing how much you can contribute to your retirement accounts is important.

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Gifting Appreciated Stock To Family Members

Gifting Appreciated Stock To Family Members

For children with lower incomes, there is an opportunity to give them appreciated stock to shift the capital gains to a lower tax bracket.

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2016 Tax Facts

2016 Tax Facts

Here’s a quick guide to the tax brackets and some other useful information for 2016.

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What is the Kiddie Tax?

What is the Kiddie Tax?

The kiddie tax was first added to the tax code in 1986 for children under age 14. Now, it can burden them until they are 23.

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Trust Protections from Creditors and Spendthrift Beneficiaries

Royal Guards

The beauty of trusts is that they are very flexible, and an estate lawyer can help you craft a document that will follow your wishes and give you peace of mind.

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Mailbag: Where Does Cost Basis Go in a Partial 1031 Exchange?

Mailbag: Where Does Cost Basis Go in a Partial 1031 Exchange?

In a 1031 exchange, the cost basis of the property you give up is rolled into the new property you receive.

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Utilizing Uncommon Beneficiary Designations

Utilizing Uncommon Beneficiary Designations

Will substitutes sacrifice some of the customization of trusts but avoid the accounting complexities.

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Understanding Your IRA Required Minimum Distributions (RMDs)

Understanding Your IRA Required Minimum Distributions (RMDs)

After you reach the age of 70 1/2, the IRS requires you to begin taking minimum distributions from your traditional retirement accounts.

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When Are Taxes Due On A Roth Conversion?

When Are Taxes Due On A Roth Conversion?

Any tax which is ultimately going to be owed is owed by April 15th. Otherwise it may be subject to interest and penalties.

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Mailbag: When Can I Move Into a 1031 Property?

Mailbag: When Can I Move Into a 1031 Property?

Because 1031 exchanges are a great way to defer paying large amounts of capital gains tax, the IRS tends to be suspicious of them.

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What Capital Gains Is Owed For The Sale Of Gifted Stock?

What Capital Gains Is Owed For The Sale Of Gifted Stock?

It is better to leave stock to a family member in your estate plan than to gift them the stock while you are alive.

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Jeb Bush’s Tax Plan

Jeb Bush's Tax Plan

Bush’s tax plan is in good company with Trump, Rubio, and Lee. It hits many common Republican talking points but doesn’t seem to take its own reasoning very seriously.

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Why You Should Use a Donor Advised Fund

Why You Should Use a Donor Advised Fund

We highly recommend a Donor Advised Fund for generous investors.

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Can I Write My Own Estate Plan?

Can I Write My Own Estate Plan?

The shortest answer is yes, you can. But just because you can, doesn’t mean you should.

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Radio Interview: Which Retirement Accounts Should I Fund?

Radio Interview: Which Retirement Accounts Should I Fund?

David John Marotta was interviewed on radio 1070 WINA discussing which retirement accounts you should fund for the best tax outcomes.

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How Frequently Should I Redo My Estate Plan?

How Frequently Should I Redo My Estate Plan?

Here are the most common reasons that your plan might need to be updated or revised and what to do about them.

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Donald Trump’s Tax Plan

Donald Trump's Tax Plan

Tax season under Trump’s plan would likely be just as complicated but slightly less painful.

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How Much Can I Contribute To A Roth IRA If I Earn Too Much?

How Much Can I Contribute To A Roth IRA If I Earn Too Much?

I’m on the borderline for being able to contribute to a Roth IRA. How do I determine how much I can contribute?

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How To Correct Excess Roth IRA Contributions

How To Correct Excess Roth IRA Contributions

Regardless of the reason, if you have put too much money in your Roth IRA, the solution is the same.

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What is a Backdoor Roth?

What Is A Backdoor Roth?

Even over the income threshold, you may still be able to add funds to your Roth IRA with what is called a backdoor Roth.

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