Friday, May 28, 2021

Is getting paid to move your 401k right for you?

 

Are you paying too much for your 401k or 403b at work?

Most employers keep the fees hidden so many working people have no idea. Some think their pension plan is free. Larger employers must keep fees low since many have been sued for charging excessive fees and kickbacks to themselves. However, if you are working for a small or non-profit employer, you are probably being scalped. Depending on which investment option you have chosen in your plan, you could be losing money. Fixed (no loss) investments like stable value funds may earn 2% or less. If inflation is 2% as it is now, you are losing money. Worse, some non-profits offer pension plans run by insurance agents. My wife was losing money in her tax-deferred annuity plan and was charged a surrender fee when she tried to transfer it to a low-cost provider. Many plan participants are urged to invest conservatively when hired so their life-time nest egg hardly grows at all. You may end up with less than $200,000 instead of accumulating $500,000. John Bogle, founder of Vanguard, said “the tyranny of compounding costs” is overwhelming. You may be giving up 63% “of what you would have had.” If your contributions are matched by your boss, this may overcome the high costs. Otherwise you are better off using the IRS-approved tax-FREE account.

Pay less; earn more: https://www.amazon.com/Robbing-You-Blind-401k-fees/dp/1493588966

 

Why is it critical to start investing as early as possible?

Why are the rich getting richer during this time when so many don’t even make the minimum wage? Part of the answer comes from the idea of compound interest. Warren Buffett swears by compounding: “MY WEALTH HAS COME FROM A COMBINATION OF LIVING IN AMERICA, SOME LUCKY GENES, AND COMPOUND INTEREST.” For those of us who invest in order to have enough money for retirement, time is critical. Buy buying the stock of profitable companies, we can earn about 11% a year over time. The stock provides dividends which buy more stock. Because of profits, each share is valued at a higher level each year. These two combine to make the value of our money double in about 7 years. If we invested $9 a day for 40 years starting at age 20, our account would show $2.1 million. If we waited to start investing until age 40, it would cost $82 a day to reach that amount. Time investing takes the place of cash. The rich who already have $2.1 million at age 60 might have $4 million by age 70. If they had $4 million at the beginning of 2020 when they lost their jobs, they would have over $5 million now just by holding on to their low-cost stock index fund that increased by 45%.

Follow Buffett’s advice: https://www.amazon.com/Warren-Buffetts-Vanguard-Funds-Retirement/dp/1496148592

 

Will Biden’s tax increase on capital gains hurt or help you?

This question will come to you during the next year. Consider this: the rich don’t live on wages that are taxed like we do. Many use family money to buy assets like commercial buildings. As the assets appreciate, there are no taxes on the rents. There are loans. The loan interest is paid by the rents. The loans finance the lifestyles of the rich—homes, cars, planes, servants, etc. The loan proceeds are not taxable. They actually get an interest deduction on the money they live on. To buy a bigger building, they don’t pay tax on the sale like you would because the IRS thinks the new building is just an exchange. Some like Mr Romney set up partnerships offshore so the lower taxes paid by the partnership actually offset taxes owed on other income. He also exploited the IRA rules to delay taxation on the gains from the companies he launched at Bain. The wealthy pay less than HALF the taxes we pay. The rich use gifts to charities they create or control to offset income also. The wealthy employ professional tax advisors to reduce/eliminate their income and capital gains taxes. Some use offshore tax havens to avoid the taxes we pay. If you don’t have capital and profits, Biden’s taxes may reduce all our tax increases.

Reduce your taxes legally: https://www.amazon.com/Tax-Free-Living-2012-strategies-build/dp/1477452702

 

Is getting paid to move your 401k right for you?

Some financial service firms will pay you up to $3,000 to move your pension to their self-directed IRA. Why do you think? Good will? Charity? No, it is because they want you to pay their fees for the rest of your life and beyond. However, read the small print—you have to let them hold your $1.5 mil to get $3,000. Such a deal! Over the next 30 years of your retirement, you may pay them 1-2% which will be over $100,000 for an average size 401k. One of my readers shared his story: $500,000 IRA rollover which costs 1% a year over 20 years in retirement equals $100,000 in fees he gave up to his advisor. I helped him transfer his money to a low-cost provider which cost him $2,000 a year not $5,000 a year. Consider better options for you not your advisor.

https://www.amazon.com/Best-Robo-Advisor-Ultimate-Automatic-Management/dp/1537111957/

 

Best stocks to own for the coming years

When you look at your most recent investment statement you should be delighted. The stock market is up 45% for 1 year; 17% for 5 years; and 14% for 10 years. The long-term average is 11% before your advisor’s charges and fees. My readers are telling me that they are buying more Apple, Amazon, Facebook, Google, JPMorgan, Visa, Home Depot, and other large companies. They are avoiding crypto for now. They want to continue to enjoy the benefits of an expanding economy and they feel unsure about new trends. Most of my readers are investing for the long-term—retirement or retirement income for their future 20 or 30 years. Most of them are not fast traders. They take their IRS-required minimum distributions by withdrawing dividends and selling shares across the entire portfolio. They don’t know which stock to hold. The future of each stock price is unknown. They are planning to live to age 100.

https://www.amazon.com/Warren-Buffett-Your-Investment-Advisor/dp/1518690963

 

Is a 529 college savings plan right for you?

If your state does not match the Fed’s deductibility feature, you can open any state 529 plan. You pay no taxes on the earnings in your plan. You can open multiple 529 plans, and you can roll over your funds from one into another 529 plan once every rolling 12 months. Check the Morningstar Top 529 College Savings Plan Rankings. Utah and Michigan are top plans and pay bonuses. You can accumulate more in your plan by opening the account yourself—brokers take fees annually. You can set up the plan even before you or your adult children have a child. There are many options if the plan is not tapped right away for education for the intended person. Eventually, if you or someone else does not use the funds for an education, the plan is like an IRA—tax on earnings and 10% penalty. So you could use the plan to grow funds tax-deferred if you have maxed out your IRAs. Check options to pay for college: https://www.amazon.com/Education-Funding-Save-right-plan/dp/1482549956/

 

Minimize taxes on your retirement income

You found out that Social Security benefits are taxed—up to 85% of that income could cause you to hit the next tax bracket. A little planning can help you control when you are taxed on income in retirement. Unless you are really wealthy and can put most of your nest egg in tax-FREE municipal bonds paying 1%, you need a little knowledge to avoid the worst. The premium for the Medicare Part B program goes up at different income levels. If you try a Roth IRA conversion, you could trigger higher taxes on other income. Capital gains taxes are increased for higher income years. Reducing future IRA withdrawals (RMD) may be possible with a qualified charitable distributions QCD processed from your IRA. Control taxes: https://www.amazon.com/What-your-RMD-much-spend/dp/1718946716

 

 

Where is that refund?

The Internal Revenue Service reminds taxpayers that the most convenient way to check on a tax refund is by using the “Where’s My Refund?” tool at IRS.gov or through the IRS2Go Mobile App.

Where is the stimulus 1 or 2? If you did not receive stimulus 1 or 2, start filing here: https://www.irs.gov/newsroom/recovery-rebate-credit.

Stimulus 3? https://www.irs.gov/coronavirus/third-economic-impact-payment

 

 

 

**********ACCOUNTABILITY**************

 

 

Like 1776, this period is a test of democracyWe rejected an "American fascist"

 

Dictator steals reporter’s correspondence

 

Ted Cruz consulted by Jan 6 terrorist beforehand

 

When ‘Truth and Reconciliation Commission’? 

 

 

How Govt wastes our money:

Can the Treasury find the money of tax cheats? Congress will find new ways to help rich

Most Americans don’t want unemployed to receive extra $300 week:

Even if Biden finds source of COVID. it won’t bring back almost 600,000 dead

 

GOP reverses AZ vote on wealth tax: voter decision ignored; voter pays more taxes

 

SCAMS/SPINS:

California Auto Finance caught charging interest late payment w/o notice

AZ GOP using “auditor” that will find election count errors to ‘prove’ Trump Big Con.

Fake news circulated by conspiracy promoters to disrupt US life

 

Trumpists rewriting history of failed Coup: terrorist clubbed police to stop Congress acts

Trumpists planned Congress reverse electoral vote that day: not ‘riot’ or ‘insurrection’

Trumpists relieved Biden supports keeping Trump obstruction memo secret from public

 

Trumpist Green calls Pelosi mask protection like Holocaust mass killings of millions

COPS BEWARE: Texas allows anyone to use guns: no license, untrained, anyone!

Does Qualified Immunity rule attract bullies who like to beat people up?

 

Not for your kids: Vehicles that have a bad accident record

Ebay cars are for sale but not with Ebay guarantee: scams galore!  Better web sources

Scam: crypto is the hottest scam around: fake currency investment at a ‘discount’

 

Why firms pay ransom instead of using the file backup they already paid for

CEO pay jumped 16% in pandemic 2020 while average worker compensation rose 1.8%.

 

What the wealthy are buying now: diagnostic toilet replaces doc visits?

Budget Hearing Aids caught making false claims for products

Affection scam: get weekly pay to be lover is not real: empty your account results

 

Scammers Target Families Who Post Missing Persons on Social Media

Frontier Communications caught misrepresenting Internet speeds

 

Edward E. Matthes caught using fake investments promised high returns; 5 years prison

Emil Botvinnik FL caught churning clients’ funds to increase his income

Driver Loan caught misrepresenting the risks associated with their deposit product 

 

Phone apps that hog memory and drain battery rated

Work at home scams: it sounds easy but that is why it is a scam

Catholics may bar Biden from Host: his politics not God determine Heaven or Hell?

 

Wormuth confirmed as first woman Army secretary — then she was unconfirmed

 

 

IRS: Easy Steps to Protect Your Computer and Phone and Avoid Phishing Emails.

IRS: Free special ID protection PIN goes on your return so scammers can’t take refund

IRS: Previous tax returns available online: https://www.irs.gov/individuals/get-transcript

IRS tips to avoid scams: https://www.irs.gov/newsroom/tax-scams-consumer-alerts

 

Is it a scam?  Check AARP scamline 877.908.3360. BBB Scam tracker

 

Check IRS: https://www.irs.gov/newsroom/dirty-dozen-part-1-taxpayers-should-be-on-the-lookout-for-these-scams

https://www.irs.gov/newsroom/dirty-dozen-part-2-thieves-work-all-year-to-scam-taxpayers

Find tax preparer: https://www.irs.gov/tax-professionals/choosing-a-tax-professional

 

Check Social Security: https://blog.ssa.gov/

Safeguard data: ConsumerReports help: https://securityplanner.consumerreports.org/

 

 

Jobs

Biden fills lost positions: Gov hiring: good pay, benefits, pension, no layoffs,

Job managers spend 6 seconds per resumes: write yours for those 6 seconds!

 

Who owns your account now?

Health care coverage affordable with ACA special enrollment to Aug 15

 

Miracles:

Microscope trick helps create pic of atom despite fact we can’t ‘see’ ‘particle’ atom.

We know atom components are not particles but energy clusters that move.

Why some people are limited: any amount of alcohol causes brain damage

 

Nine states now have 70% of adult residents with at least one vaccine shot

Blind regains some sight using special protein and a virus

 

We can apply for Medicare online: https://blog.ssa.gov/apply-for-medicare-online

We can apply for Social Security online: https://www.ssa.gov/benefits/retirement/

We can apply for health care online: https://www.healthcare.gov/

 

 

IAN

41 Watchung Plaza, B242

MontclairNJ   07042

973.746.2014

www.InsuranceAdvisorsNetwork.com

Alerts available at http://dankeppel.blogspot.com/

 

Friday, May 21, 2021

Can we pay fewer taxes like the rich?

 

Student loan rates going up

Interest rates on federal student loans are set to rise nearly a full percentage point later this year, increasing the price of borrowing to pay for college for current and incoming students. The new rates, which are based on the results of a Treasury auction Wednesday, apply only to loans issued for the upcoming 2021-2022 academic year. Old loan rates stay the same but is it time to take some gains and pay old loans down or off? Unless you have need of the tax deduction in retirement, getting rid of debt now may be a smart move. On the other hand, the interest on this debt reduces income and taxes even if you don’t itemize. If you are concerned about your grandchild paying for higher education, you might use some of your gains to reduce the amount of loans taken out. Some of us have experienced better earnings (56%) than expected and a college education is a great use of our money. Saving for college can be less expensive using a 529 plan. You may also consider having your student do the first two years at a community college.

Consider your options: https://www.amazon.com/Education-Funding-Save-right-plan/dp/1482549956

 

Advisors having a hard time beating low-cost index funds.

If you did not notice or your advisor does not use a benchmark, your low-cost index fund beat almost all the traders this past year. Vanguard’s 500 Index is up 56% for one year. Yes the stock market goes down but you get a long-term average of about 11% in a low-cost fund. Since 2010, advisors have been hard pressed to earn their fees. Vanguard charges 0.04% a year because we investors own it—no middle people—so we keep almost all of our gains. Many of my readers hit or passed their goals for the year already. Just consider how right your advisor must be buying and selling to beat the market. Even the smartest gurus have trouble beating the markets. Yale’s legendary manager David Swensen with his 12.4% record failed to beat the market rate of 13.02% during his 1985-2020 tenure. Most advisors earn you only 3.79% over time. You can do better.

Earn 11%:  https://www.amazon.com/You-Beat-Wall-Street-professionals/dp/1986031373

 

Does “bundling” insurance save you money?

Several carriers claim “bundling” or “customizing” saves you money. Certainly, it saves the insurer money. But buying two or more policies from the same company may actually cost you more. We need to shop for the best deal for each—auto, home and umbrella—since each contract has good and bad elements. For instance, my homeowner’s has been in place for 40 years and no other provider can match the price. On the other hand, my car company keeps raising the price despite me driving less, taking the safe driving course, and keeping my cars longer. And only my vehicle insurer will write my lawsuit coverage since it depends on a certain amount of vehicle liability coverage. Giving all your insurance business to one agent makes sense for their convenience but often costs you more, not less. Worse: some folks buy their retirement income and investments from their insurance agent. “Bundling” is a sales gimmick not an insurance discount.

Shop and save: https://www.amazon.com/Save-000-every-year-Only/dp/1500681571

 

Can we pay fewer taxes like the rich?

Inequality has grown dramatically over the last four decades: The top 1% have enjoyed extraordinary income growth, while growth for the vast majority has been anemic. Yet high-income households have not been asked to pay higher tax rates and corporations’ contributions to federal taxes have fallen to historic lows. Wages have fallen over time—they have become detached from productivity gains. Tax assessments come from wages and the rich don’t live on wages. And Social Security stops taking taxes on incomes over $142,800. Most of their income is tax-deferred or tax-advantaged. For instance, Warren Buffett with over $108.2 Billions pays only 17.7% while his office workers pay over 32.9%. The wealthy use complicated legal entities to hide their incomes. Take the former president’s claim that you are smart when you can pay professionals to manipulate your income. They found him a way to subtract his failed businesses on his personal income taxes so he can avoid taxes for years. Stop paying taxes like the rich; but do it legally.

Tax-FREE IRS account: https://www.amazon.com/Trump-Tax-Shelter-Avoid-taxes/dp/1985448300

 

How to keep your retirement full of income

First, you gotta beat inflation—25+ years may be the length of your income needs—but the VALUE of your fixed income is cut in half in 25 years. In the past, when people died right after retiring, they never had this problem. Today your $800 a month will be able to buy only $400 worth of goods in 25 years. You can’t beat inflation by holding your nest egg in 1% CDs and bonds. Stocks will protect you from inflation since the average return of 11% is greater than the 3% inflation rate. Prepare for a down market by using two buckets—one with a year of living expenses and the rest in a stock mutual fund like Warren Buffett’s heirs. Second, you can’t be assured of cash later if you spend it unwisely now unless you continue to grow your portfolio. Third, you can’t buy your kids happiness at the expense of your future. Most grandparents want to give financial support but they also don’t want to become a financial burden. Relax; your offspring will make it on their own by learning how to save. Fourth, get out of debt as soon as you can so you can have enough for later. Fifth, use tax-advantaged accumulation accounts. You have a great legal tax shelter available so use it for a tax-FREE retirement.

Go tax-FREE: https://www.amazon.com/New-American-Retirement-System-ReserveTM/dp/1461030072

 

Maximize SS benefits with your spouse

Taking Social Security benefits is not so simple. You and your loved one need to look closely at the options together BEFORE making a decision since some decisions cannot be reversed. Because the SS offices are closed now, you need to use the website and get help from a knowledgeable source. If you can make an appointment, even virtually, your best source may not be the SS office personnel. However, they helped us learn of collecting higher benefits than we thought we received when we first applied. There are claiming strategies that are better long-term than taking benefits as soon as you can.

How to maximize income: https://www.amazon.com/Maximize-Social-Security-Benefits-Retirement/dp/1495439224/

 

 

Where is that refund?

The Internal Revenue Service reminds taxpayers that the most convenient way to check on a tax refund is by using the “Where’s My Refund?” tool at IRS.gov or through the IRS2Go Mobile App.

Where is the stimulus 1 or 2? If you did not receive stimulus 1 or 2, start filing here: https://www.irs.gov/newsroom/recovery-rebate-credit.

Stimulus 3? https://www.irs.gov/coronavirus/third-economic-impact-payment

 

What to do if you can’t pay by May 17?

Avoid the penalty for not paying estimated tax. Ask for an automatic extension to file till October. If that does not work for you, you can apply for a payment plan. An individual can setup an IRS installment plan if you owe $50,000 or less and can pay back the amount owed in 3 years. If you are a business owner, you can setup an installment plan if you owe $25,000 or less. The IRS will charge a one-time fee of $105.

If you own less than $25,000 and can pay the amount owed within six years, ask the IRS for a streamlined payment agreement. The IRS will charge a one-time fee of $102.

Request an Offer in Compromise if you cannot pay the total amount owed. This allows you to settle your tax debt for less than the total amount owed if you will be unable to pay back the total amount owed within 10 years. The IRS will charge a one-time fee of $150. Given the pandemic economic hardship, apply for the extension to file now: https://www.irs.gov/pub/irs-pdf/f4868.pdf

Special circumstances help: call the IRS Taxpayer Advocate Service 1-877-777-4778 for free assistance.

More ways: https://www.irs.gov/newsroom/heres-how-people-can-pay-their-federal-taxes

 

 

**********ACCOUNTABILITY**************

 

 

Like 1776, this period is a test of democracyWe rejected an "American fascist"

 

Dictator steals reporter’s correspondence

 

When ‘Truth and Reconciliation Commission’? 

 

 

How Govt wastes our money:

Lack of health insurance delays treatments: more critical care and expensive solutions

GOP wavers on rounding up tax cheats: political donations matter: workers pay more tax

We paid $7 million in fake farm owners: no D&B, property or employee checks

 

Trump continues to take our money to push his propaganda: Steve Miller on our salary

 

SCAMS/SPINS:

GOP: No Jan 6 insurrection; no Dem president; no taxes for repairs; no discrimination.

Death threats used as a tool of control of GOP: GOP policy now: It’s the big lie or death

Trumpist illegal voting: prosecuting the wrong group

Trumpist news: Census did NOT count voters: Fake pics mislead

 

GOP millionaires say extra $300 unemployment is too much: min wage “$290 is better”

Congress protects scammers once they have our money: FTC can’t return our stolen $.

GOP takes control of PA gov decisions on emergencies, schools, etc

 

Auto pilot kills another non-driver: Tesla didn’t ‘see’ truck or side of road at night

 

BEWARE: cheap hearing aides may not work well: return policy?

Masks still needed 7 places: keep one in pocket

Many conservative men fear vax needle keeping the pandemic death rate high.

Vacation in safe spot: US has pandemic hot and cold spots: Few get shots here

 

Broker violation check useless: 90% of FINRA complaints/violations removed

Knight Nguyen caught selling high-risk fraudulent securities promising low-risk alts

Richard E Jackson TX caught framing the wrong men: how many more? No jail

UBS, UniC, Nomura caught in EU bond price-fixing cartel : fine; no jail

 

CNA Financial IL raising rates to cover $40 mil to hackers: cheaper to hire the hackers

 

DMB Financial MA debt consultant caught charging unlawful fees: refunds but no jail

Frederick M. Stow TN caught stealing $930,000; forging transfer forms: 5 year jail

Fidelity allows teens to gamble: no experience/oversight required, another suicide?

 

Paying ransom or neutralize hackers: $5 million or Seal Team 6 next time.

 

IRS: Easy Steps to Protect Your Computer and Phone and Avoid Phishing Emails.

IRS: Free special ID protection PIN goes on your return so scammers can’t take refund

IRS: Previous tax returns available online: https://www.irs.gov/individuals/get-transcript

IRS tips to avoid scams: https://www.irs.gov/newsroom/tax-scams-consumer-alerts

 

Is it a scam?  Check AARP scamline 877.908.3360. BBB Scam tracker

 

Check IRS: https://www.irs.gov/newsroom/dirty-dozen-part-1-taxpayers-should-be-on-the-lookout-for-these-scams

https://www.irs.gov/newsroom/dirty-dozen-part-2-thieves-work-all-year-to-scam-taxpayers

Find tax preparer: https://www.irs.gov/tax-professionals/choosing-a-tax-professional

 

Check Social Security: https://blog.ssa.gov/

Safeguard data: ConsumerReports help: https://securityplanner.consumerreports.org/

 

 

Jobs

Gov hiring: good pay, benefits, pension, no layoffs,

Be creative: Neanderthals died out because they were less creative than humans

Joe Biden is selling new eF150: starting at $39,000: it is “quick” he says.

 

Coping with new work environment: yes, you must wear clothes again

 

Who owns your account now?

Homeowners insurance ratings: your best deal for coverage

Vehicle insurance ratings: you best deal for coverage

Refinance before rates go up: 3% rates won’t last forever

 

Used car prices up 12%: average $23,000: more than new

State Farm to provide electric-fire detection monitor: plug in sends message to phone

HealthCare available for pandemic victims: get subsidies just like your Congressperson

 

Best household paint: 5,804 opinions help you pick—good paint saves money/time

 

Miracles:

Texting by thoughts: computer translates thoughts into text

No mask; no 6 feet; not HALF vaccinated: 590,000 and counting

Iceberg 80 times the size of Manhattan on its way to find Titanic: friends reunited

 

We can apply for Medicare online: https://blog.ssa.gov/apply-for-medicare-online

We can apply for Social Security online: https://www.ssa.gov/benefits/retirement/

We can apply for health care online: https://www.healthcare.gov/

 

 

IAN

41 Watchung Plaza, B242

MontclairNJ   07042

973.746.2014

www.InsuranceAdvisorsNetwork.com

Alerts available at http://dankeppel.blogspot.com/

 

Friday, May 14, 2021

Lessons of investing great David Swensen

 

Is inflation really a threat to your money?

Current media spin is using inflation fear as a theme. Prices have risen because the economy is gaining strength after a pandemic shut down. Sure inflation exists. But it is a threat only if you are holding tons of bank CDs and bonds with low interest yields. Banks and bond issuers will have to bump up payouts to sell their new bonds so the old ones will be worth less. If you are holding a broad spectrum of stocks in a low-cost account, you will continue to enjoy the high earnings (stock market up 10% in ‘21). Do you really think Apple, Amazon, Google, Facebook, etc will stop growing and be defeated by 2% inflation? They will just raise prices to cover higher costs. For instance, Amazon has already increased revenue by raising the cost of selling my books. For most of us long-term investors, stocks are the safest investment strategy. Stocks will protect us from inflation since the average return of 11% is greater than the 3% inflation rate. Plus, since we invest in tax-free accounts, we earn an extra 25% by NOT paying income taxes on our withdrawals. 11%-3% = 8%. 8% is greater than 2% CDs/bonds.

Go tax-FREE: https://www.amazon.com/New-American-Retirement-System-ReserveTM/dp/1461030072

 

 

Most of us regret not having emergency fund

We all have financial regrets—few high school students learn how to manage and grow their assets. There is a simple tax-free way to grow your emergency fund at better rates than a bank CD. Bank CDs are safe but you lose money to inflation over time. Saving for the unexpected means not cashing in your savings for a new Playstation. Opening a tax-free account for $1,000 with a low-cost target-date fund can provide $15,000 after only a few years of saving. You contribute $10,000 over time and you have $10,000 available when you need it. You pay no income tax, penalty or default interest. If you have no emergency, your money grows tax-free for years. Even if you add no more money to this fund, you could easily have $500,000 when you stop working. When you start saving early in your life, you use time to build wealth. You let the Miracle of Compounding work for you. You put in $10,000 and receive $500,000 tax FREE. You can not find a better investment plan than that. And there is money there when you need it. You have a Wealth Reserve for life.

https://www.amazon.com/Your-Wealth-ReserveTM-Tax-FREE-Investment/dp/1484954882

 

 

GOP asks us working people to pay more

Uncollected taxes equal the total taxes paid by the lower 90% of taxpayers.”

According to 5 IRS commissioners, the wealthy don’t pay their taxes. In fact, by not paying their fair share, we and our kids will end up paying for their $2 billion tax break. Those who don’t pay taxes increased their wealth by 55% this past year. Now the GOP complains about the deficit when asked to pay for the infrastructure bill which will create more jobs. Most corporations have had a fantastic year and keep more of their profits. In fact, most large American firms pay little or no taxes because they are able to claim their ‘home’ is in a foreign country where taxes are lower. For some companies like Amazon we pay for their refunds. Other corporations have paid Congress for sweet deals and are actually subsidized by our tax dollars despite big profits. Congress needs donations for elections so members don’t dare touch the tax laws. This is the American version of socialism: Socialism for the rich: the rich take the profits while we pay for the deficits created by gov tax breaks. Congress is full of millionaires. They make the laws. As Mitch says, Congress will “turn America into a socialist country." Already gives money to rich.

https://www.amazon.com/Americas-Socialism-Rich-little-people/dp/1535218584

 

Is this tax avoidance scheme right for you?

This strategy is called a syndicated conservation easement. It is a land deal that the IRS says is often an abusive tax shelter. Congress created this “incentive” in 1980 for owners who pledge to never develop their properties. Through a broker, you join other investors to buy large acres of land and promise never to develop it. You get a whopping tax deduction of as much as five times the amount invested. This is one of the tax avoidance schemes that Trump is being investigated for on his upstate NY property. He claimed he does not pay taxes because “I an smart” during the election. The IRS Commissioner Charles Rettig told a Senate panel last month that 28,000 taxpayers are under examination, some for similar land deductions. $21 billion in tax deductions are now being challenged. This tax avoidance strategy may be right for you since the rewards are much greater than the costs if your deduction is disallowed. Most investors never face jail and would have to pay tax later rather than now. Legal staff is available to help you avoid ever paying your taxes. With IRS’s current lack of enforcement staff, working Americans are more likely to pay the taxes you avoid than you are. Working Americans can avoid paying your taxes by using their own legal tax shelter.

Use the workers’ shelter: https://www.amazon.com/New-American-Retirement-System-ReserveTM/dp/1461030072

 

Help your graduate avoid paying for tax cuts/subsidies for the rich

High school and college graduates need the best gift you can give them: a future of tax-FREE income. Get them started now since your gift can grow a THOUSAND times its value over time. For instance, $50 invested now can provide them with $20,000 when they need it later. Since you have started your grad off with this special IRS-approved tax shelter they will find it easier to keep saving/investing the right way. They will end up with a tax-FREE retirement. They can create a $500,000 tax-FREE account. Some young people have grown their accounts to over $1 million by investing $167 a month while they work. They will pay NO taxes on their wealth. They can avoid future tax increases. They can boost their savings by 30% just with the fed/state tax savings alone. And if they need a home down payment or business start up fund, they can use the contributions tax and penalty FREE.

Perfect gift: https://www.amazon.com/Tax-Shelter-Young-Americans/dp/1500426520

 

Lessons of investing great David Swensen

The legendary head of Yale endowment passed away this week. He changed ivy investing at many schools by developing a much wider asset mix to try to steady the flow of capital for scholarships and expenses. Over his tenure at Yale his asset picks returned 12.4% per year on average with dips during the trying years of 2008-09. What can we learn? During this period—1985 to 2020—the stock market index fund you owned earned 13.02%. The Vanguard’s equivalent earned 13% after 0.04% fees. Swensen invested new money in new types of assets. He relied on the Miracle of Compounding—reinvesting dividends and interest to match the S&P 500 index over a long time. His last 10 years grew $100 to just under $300. Our last 1, 5 and 10 years’ returns were also exceptional: over 13%. He was not a fast trader. His portfolio included many of the stars that are represented in the top global corporations of today.

Invest like a pro: https://www.amazon.com/Best-Robo-Advisor-Ultimate-Automatic-Management/dp/1537111957

 

How can you and your spouse agree on a spending plan in retirement?

Just like planning the family vacation, you both need to discuss your future money situation. If your spouse has a different vision of retirement, if you don't agree on financial issues or you avoid them completely, then conflicts are inevitable. Left unattended, these problems may become so serious that they threaten your relationship. Most of us have fights over money—usually spending habits and dishonest dealings. Actually 29% of divorced boomers said they ended their marriage due to disagreements about money. You have to discuss where all money comes from and goes in a detailed way. Exactly how much is being spent in a month by both of you is important to know. Buying secret lottery tickets or secret food/liquor stores is just the beginning. If you are not used to sharing this info, you will not be able to know how much to spend in retirement. Sure you both could agree to keep a certain amount for secret purchases, but you must be careful. You both must agree on the investing strategy in retirement. So when the market falls temporarily, you have a plan (emergency fund) to still keep spending on essentials. If you are subsidizing a child, you must agree on how much and for how long. Otherwise you both could end up running out of money too soon. Your discussion should include the cost of aging or healthcare changes. Do you have a reserve to cover those costs? Finally, make and update your wills, power of attorney, health care directives and final passing arrangements.

Make plans together to stay together: https://www.amazon.com/What-your-RMD-much-spend/dp/1718946716

 

Can you withdraw 4% from your nest egg annually?

Financial advisors often fall back on this old rule as a guide to retirement income. This rule was created by William Bengen with data from the 80s when lifespans were shorter and advisors did not have computer software to provide a comprehensive retirement plan. Those assumptions are null and void. You can determine your rate of withdrawal based on your needs not your advisors’ guesswork. One of the assumptions that can throw off your expected retirement income is that your portfolio needs to be in fixed income—CDs, bonds and annuities. This has proved to be dangerous for you but a safe harbor for advisors. Advisors are not likely to be managing your money for the rest of your life. They can only guess what will happen in the next 1-3 year window. You are safer using the growth and income strategy that Warren Buffett recommends.

https://www.amazon.com/4-Retirement-Rule-Wrong-Lifestyle/dp/1492218960/

 

 

Is life insurance EVER a “great” investment?

For some people, [permanent life insurance] can be a great investment” says one sales person. “Above all, life insurance is most compelling typically as an investment for high-net-worth individuals who are in a high tax bracket and are dealing with taxable accounts,” he adds. Finally, this sales person admits, “you already enjoy most of the tax benefits that are afforded cash-value life insurance.” You are better off buying and holding a non-dividend stock so you can avoid paying tax on your accumulations, just like permanent life insurance. Cash value life insurance is never a good investment. If you invest to grow your wealth, your wealth becomes your legacy more efficiently than expensive life insurance. Most of your premiums are going to the agent and the insurers’ profits.

Create your Reserves not the insurers’ Reserves: https://www.amazon.com/Life-Insurance-Need-Save-right/dp/1480002178/

 

 

 

 

 

 

Last chance to reduce taxes due May 17

If you owe, you have one last chance to get a refund or reduce what you owe. Thanks to the deductibility of a traditional IRA contribution, you may cut yourself a break. Instead of owing the government, you could have a refund. The amount depends on your situation. By opening or adding to your traditional IRA contributions for 2020 not 2021, you give yourself a retroactive refund. Yes, the IRS will receive a contribution confirmation from your bank or mutual fund firm but at least you have one less bill this month. Even though every tax preparation company can get you an extension to file the paperwork, the tax itself must be paid by May 17. There are rules.

https://www.amazon.com/Your-Wealth-Reserve-Save-year/dp/107028288X

 

Where is that refund?

The Internal Revenue Service today reminds taxpayers that the most convenient way to check on a tax refund is by using the “Where’s My Refund?” tool at IRS.gov or through the IRS2Go Mobile App.

Where is the stimulus 1 or 2? If you did not receive stimulus 1 or 2, start filing here: https://www.irs.gov/newsroom/recovery-rebate-credit.

Stimulus 3? https://www.irs.gov/coronavirus/third-economic-impact-payment

 

Tax returns for 2020 are due May 17 not April 15 but the estimated tax payments are still required on schedule. The IRS will redo your taxes and send a refund if you paid tax on Unemployment in 2020 or you paid ObamaCare’s excess advance premium tax credit repayment. 

 

Have tax forms; will file … for FREE but WAIT . . .

If you have unemployment income, ObamaCare coverage you don’t have to make payments. If you already filed and paid tax on your unemployment income, IRS says it will send you a refund of the tax automatically. DO NOT FILE an amended return to obtain a refund on this tax. Taxes due MAY 17. Input the W-2, unemployment, SS benefits, IRAs, pensions, RMD, brokerage, etc. forms you have. You can file for FREE online. If you didn’t receive a correct form, file a Form 4852. Usually filing your state return costs as little as $15 unless you buy the Pro helpline. Avoid $300-400 paid preparer fees—new IRS return forms mean higher fees.

 

Retirees did not have to take their RMDs in 2020 so taxes may be less: it was a good time to convert IRA to Roth IRA for tax-FREE future. Unless you were self-employed, you can’t deduct home office expenses of working from home. You can deduct as medical expense all Covid prevention supplies. Some states continue the health insurance mandate and penalty unless you have an exemption. Since the IRA contribution deduction has no age limit now, you may reduce your income/taxes by making a contribution of up to $7,000. The standard deduction went up to $12,400 single; $24,800 joint. Jan 15 last day to make 2020 estimated payments. You have to report your April/May and December/January stimulus payments even though they are not taxable. Some of us receive a bank credit; some a debit card; some a check. Even if you don’t have to file, you should file so scammers can’t use your SS number to mess up your IRS file. Tested E file software ratings. Efile Jan 15; IRS processing Feb 12.

E file avoids covid at your preparers’ office: https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free

 

What to do if you can’t pay by May 17?

Avoid the penalty for not paying estimated tax. Ask for an automatic extension to file till October. If that does not work for you, you can apply for a payment plan. An individual can setup an IRS installment plan if you owe $50,000 or less and can pay back the amount owed in 3 years. If you are a business owner, you can setup an installment plan if you owe $25,000 or less. The IRS will charge a one-time fee of $105.

If you own less than $25,000 and can pay the amount owed within six years, ask the IRS for a streamlined payment agreement. The IRS will charge a one-time fee of $102.

Request an Offer in Compromise if you cannot pay the total amount owed. This allows you to settle your tax debt for less than the total amount owed if you will be unable to pay back the total amount owed within 10 years. The IRS will charge a one-time fee of $150. Given the pandemic economic hardship, apply for the extension to file now: https://www.irs.gov/pub/irs-pdf/f4868.pdf

Special circumstances help: call the IRS Taxpayer Advocate Service 1-877-777-4778 for free assistance.

More ways: https://www.irs.gov/newsroom/heres-how-people-can-pay-their-federal-taxes

 

IRS has $1.3 billion refunds for 2017 tax returns

Unclaimed income tax refunds worth more than $1.3 billion await an estimated 1.3 million taxpayers who did not file a 2017 return, according to the IRS. “Time is quickly running out for these taxpayers. There’s only a three-year window to claim these refunds, and the window closes on May 17.” If they do not file a tax return within three years, the money becomes the property of the U.S. Treasury. Filing instructions are available on the IRS.gov Forms and Publications page or 800-829-3676.

You have 17 days to collect your cash!

 

 

**********ACCOUNTABILITY**************

 

 

Like 1776, this period is a test of democracyWe rejected an "American fascist"

 

One woman vs The Big Con

Then they came for me—and there was no one left to speak for me.

 

One person stood up to McCarthyism too

 

Are Christian Nationalists anti-democratic?

 

Crazy GOP: Jan 6 coup was “a normal tourist visit.”

 

First active-duty service member charged over the Capitol attack.

 

 

When ‘Truth and Reconciliation Commission’? 

 

 

How Govt wastes our money:

Hackers shut down pipeline to the East Coast: Let’s hire hackers--not pay $5 million

Banks to give credit cards to those without credit: we pay banks for defaults

 

 

SCAMS/SPINS:

McConnell leads GOP against any Dem plan for jobs, votes, bridges, etc, etc 100%

Biden will force unemployed to take jobs: GOP states attack own voters out of work

Trumpist judge reinforces evictions/foreclosures: 4 million must move

 

Trump runs GOP via Quislings: Fear of dictator’s wrath controls next election

Can old GOP be saved? Trumpists deny 2 party democracy: Americans voted him out

 

Healthcare sharing ministries Aliera Sharity caught misleading coverage; bills unpaid

TrumpCare policies leave patients with big bills; insurers with big profits; called junk ins

Kiwanis pays men sexually abused Centralia group home director staff other boys no jail

 

Trump may be taken down by his money man like Al Capone: NY meets Al Weisselberg

Lawyers take HALF sex abuse victim’s fund from Boy Scouts’ 95,000 claims

Hate/fear used by media manipulator for profits: profit in the hate/fear since we follow

 

10% plastic recyclable only: industry redirects us from their polluting environment

Was your iPhone hacked? 128 million folks data poached and Apple never told us

Aston Martin switches to making SUV to repay new owner: fashion mogul Stroll.

Mark Lisser Knightsbridge caught selling fake IPO shares $2 million

Matthew Clason CT caught stole $600,000 by inducing trust and using jt checking

 

Gunfights at the OK Mall” FL: when everyone has a gun; we all can get killed! Wyatt?

 

 

IRS: Easy Steps to Protect Your Computer and Phone and Avoid Phishing Emails.

IRS: Free special ID protection PIN goes on your return so scammers can’t take refund

IRS: Previous tax returns available online: https://www.irs.gov/individuals/get-transcript

IRS tips to avoid scams: https://www.irs.gov/newsroom/tax-scams-consumer-alerts

 

Is it a scam?  Check AARP scamline 877.908.3360. BBB Scam tracker

 

Check IRS: https://www.irs.gov/newsroom/dirty-dozen-part-1-taxpayers-should-be-on-the-lookout-for-these-scams

https://www.irs.gov/newsroom/dirty-dozen-part-2-thieves-work-all-year-to-scam-taxpayers

Find tax preparer: https://www.irs.gov/tax-professionals/choosing-a-tax-professional

 

Check Social Security: https://blog.ssa.gov/

Safeguard data: ConsumerReports help: https://securityplanner.consumerreports.org/

 

Jobs

SC goes back to firing squad to execute people: “more humane” lawyers say!

Business buys vax for employees: back to work and more productive/profitable

Employers who pay for your college education: a life saver for some

 

Fast growing companies may help your career grow too

 

Who owns your account now?

Some insurers are paying claims electronically: no more waiting for check to fix it

Car brands your mechanic loves: Paying $1200 a year in car maintenance?

Brexit sending business from London to EU: London headquarters to Paris, Milan

 

Advisors earn $170,000 a year from you: paying 1-2% a year erodes nest egg by 63%

 

Miracles:

Why men fear the needle and don’t want vax protection for us

Miracle: 3 “old boys” with guns chase Black and kill him: blame Black’s past now

1 million more Americans have health care: Biden opens the way for coverage for all

 

Normal life is OK w/shots except where local law/rules require controls says CDC

 

We can apply for Medicare online: https://blog.ssa.gov/apply-for-medicare-online

We can apply for Social Security online: https://www.ssa.gov/benefits/retirement/

We can apply for health care online: https://www.healthcare.gov/

 

 

IAN

41 Watchung Plaza, B242

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973.746.2014

www.InsuranceAdvisorsNetwork.com

Alerts available at http://dankeppel.blogspot.com/