Posts tagged with "Best of Pittsburgh"

End of Year check

Annual Financial To-Do List

Annual Financial To-Do List

Things you can do for your future as the year unfolds.

 

Pay Your

 

 

What financial, business, or life priorities do you need to address for the coming year? Now is an excellent time to think about the investing, saving, or budgeting methods you could employ toward specific objectives, from building your retirement fund to managing your taxes. You have plenty of choices. Here are a few ideas to consider:

  Can you contribute more to your retirement plans this year? In 2021, the contribution limit for a Roth or traditional individual retirement account (IRA) is expected to remain at $6,000 ($7,000 for those making “catch-up” contributions). Your modified adjusted gross income (MAGI) may affect how much you can put into a Roth IRA. With a traditional IRA, you can contribute if you (or your spouse if filing jointly) have taxable compensation, but income limits are one factor in determining whether the contribution is tax-deductible.1

Remember, withdrawals from traditional IRAs are taxed as ordinary income, and if taken before age 59½, may be subject to a 10% federal income tax penalty starting again in 2021. Roth IRA distributions must meet a five-year holding requirement and occur after age 59½ to qualify for tax-exempt and penalty-free withdrawal. Tax-free and penalty-free withdrawals from Roth IRAs can also be taken under certain other circumstances, such as a result of the owner’s death.2

Keep in mind, this article is for informational purposes only, and not a replacement for real-life advice. Also, tax rules are constantly changing, and there is no guarantee that the tax landscape will remain the same in years ahead.

Make a charitable gift. You can claim the deduction on your tax return, provided you follow the Internal Review Service (I.R.S.) guidelines and itemize your deductions with Schedule A. The paper trail is important here. If you give cash, you should consider documenting it.  Some contributions can be demonstrated by a bank record, payroll deduction record, credit card statement, or written communication from the charity with the date and amount. Incidentally, the I.R.S. does not equate a pledge with a donation. If you pledge $2,000 to a charity this year but only end up gifting $500, you can only deduct $500.3

These are hypothetical examples and are not a replacement for real-life advice. Make certain to consult your tax, legal, or accounting professional before modifying your record-keeping approach or your strategy for making charitable gifts.

See if you can take a home office deduction for your small business. If you are a small-business owner, you may want to investigate this. You may be able to write off expenses linked to the portion of your home used to conduct your business. Using your home office as a business expense involves a complex set of tax rules and regulations. Before moving forward, consider working with a professional who is familiar with home-based businesses.4

 Open an HSA. A Health Savings Account (HSA) works a bit like your workplace retirement account. There are also some HSA rules and limitations to consider. You are limited to a $3,600 contribution for 2021 if you are single; $7,200 if you have a spouse or family. Those limits jump by a $1,000 “catch-up” limit for each person in the household over age 55.5

If you spend your HSA funds for non-medical expenses before age 65, you may be required to pay ordinary income tax as well as a 20% penalty. After age 65, you may be required to pay ordinary income taxes on HSA funds used for nonmedical expenses. HSA contributions are exempt from federal income tax; however, they are not exempt from state taxes in certain states.

Pay attention to asset location. Tax-efficient asset location is one factor that can be considered when creating an investment strategy.

Review your withholding status. Should it be adjusted due to any of the following factors?

 

* You tend to pay the federal or state government at the end of each year.

* You tend to get a federal tax refund each year.

* You recently married or divorced.

* You have a new job, and your earnings have been adjusted.

 

These are general guidelines and are not a replacement for real-life advice. Make certain to consult your tax, human resources, or accounting professional before modifying your withholding status.

 

Did you get married in 2020? If so, it may be an excellent time to consider reviewing the beneficiaries of your retirement accounts and other assets. The same goes for your insurance coverage. If you are preparing to have a new last name in 2021, you may want to get a new Social Security card. Additionally, retirement accounts may need to be revised or adjusted?

 Are you coming home from active duty? If so, go ahead and check on the status of your credit and any tax and legal proceedings that might have been preempted by your orders.

Consider the tax impact of any upcoming transactions. Are you planning to sell any real estate this year? Are you starting a business? Might any commissions or bonuses come your way in 2021? Do you anticipate selling an investment that is held outside of a tax-deferred account?

If you are retired and in your seventies, remember your RMDs. In other words, Required Minimum Distributions (RMDs) from retirement accounts. Under the SECURE ACT, in most circumstances, once you reach age 72, you must begin taking RMDs from most types of these accounts.6

      

Vow to focus on your overall health and practice sound financial habits in 2021. And don’t be afraid to ask for help from professionals who understand your individual situation.

 

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

 

Traci L. Kovacic is a registered representative of and offers securities through The O.N. Equity Sales Company, Member FINRA/SIPC, One Financial Way; Cincinnati, OH  45242; (513)794-6794
Riverfront Financial and The O.N. Equity Sales Company are unaffiliated companies
Citations
  1. thefinancebuff.com, August 12, 2020
  2. usnews.com, February 12, 2020
  3. irs.gov, April 3, 2020
  4. nerdwallet.com, July 31, 2020
  5. msn.com, August 19, 2020
6. thestreet.com, December 21, 2019
Tax Free Money

The Tax Benefits of a Roth IRA

A Roth IRA’s Many Benefits

Why do so many people choose them over traditional IRAs?

Roth IRA

Provided by Traci Kovacic

 

The IRA that changed the whole retirement savings perspective. Since the Roth IRA was introduced in 1998, its popularity has soared. It has become a fixture in many retirement planning strategies because it offers savers so many potential advantages.

The key argument for going Roth can be summed up in a sentence: Paying taxes on your retirement contributions today may be better than paying taxes on your retirement savings tomorrow.

Think about it. Would you rather pay taxes today or wait 10 years and see where the tax rates end up? With that in question in mind, here are some of the potential benefits associated with opening and contributing to a Roth IRA.

What you see is what you get. Roth IRA contributions are made with after-tax dollars, and any potential earnings on investments within a Roth IRA are NOT subject to income tax or included in the account owner’s income. Instead, they accumulate on a tax-deferred basis and are tax-free when withdrawn from the Roth if the distribution is qualified.1

 

You can arrange tax-free retirement income. Roth IRA earnings can be withdrawn tax-free as long as you are 59½ or older and have owned the account for at least 5 years. The IRS calls such tax-free withdrawals qualified distributions.2

 

Withdrawals don’t affect taxation of Social Security benefits. If your provisional income is between $25,000 and $34,000 — or $32,000 and $44,000 for joint filers — then your Social Security benefits may be taxed if you take withdrawals before your full retirement age. Luckily, a qualified distribution from a Roth IRA doesn’t count as taxable income, which may be a means of avoiding taxation on your social security benefit.3,4

You have until your tax-filing deadline to make a Roth IRA contribution for a given tax year. For example, IRA contributions for the 2020 tax year may be made up until April 15, 2021. While April 15 is the annual deadline, many IRA owners who make lump sum contributions for a given tax year make them as soon as that year begins, not in the following year. Making your Roth IRA contributions earlier gives the funds in the account more time to potentially grow. Remember, though that Roth IRA contributions cannot be made by taxpayers with high incomes. In 2020, the income phaseout limit was $139,000 for single filers and $206,000 for married couples who file jointly.5

Who can open a Roth IRA? Anyone with earned income (and that includes a minor).

How much can you contribute to a Roth IRA annually? The combined annual contribution limit to all of your traditional and Roth IRAs is $6,000 for 2019 and 2020 ($7,000 if you’re age 50 or older), but income limits may reduce or eliminate your ability to contribute. To sweeten the deal even further, you can keep making annual Roth IRA contributions all your life.6

All this may have you thinking about opening up a Roth IRA. A chat with the financial professional you know and trust may help you evaluate whether a Roth IRA is right for you, given your particular tax situation and retirement horizon.
Tax free

 

 

1-The Roth IRA offers tax deferral on any earnings in the account. Withdrawals from the account may be tax free, as long as they are considered qualified. Limitations and restrictions may apply. Withdrawals prior to age 59 ½ or prior to the account being opened for 5 years, whichever is later, may result in a 10% IRS penalty tax. Future tax laws can change at any time and may impact the benefits of Roth IRAs. Their tax treatment may change.
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
_________________________________________________________________________________
Traci L. Kovacic is a registered representative of and offers securities through The O.N. Equity Sales Company, Member FINRA/SIPC, One Financial Way; Cincinnati, OH  45242; (513)794-6794
Riverfront Financial and The O.N. Equity Sales Company are unaffiliated companies
 
Citations.
1 – irs.gov/retirement-plans/traditional-and-roth-iras [1/28/20]
2 – irs.gov/retirement-plans/traditional-and-roth-iras [1/28/20]
3 – kiplinger.com/slideshow/retirement/T055-S001-how-retirement-income-is-taxed/index.html [1/27/20]
4 – irs.gov/retirement-plans/traditional-and-roth-iras [1/28/20]
5 – morningstar.com/articles/852560/20-ira-mistakes-to-avoid [2/10/20]
6  – irs.gov/retirement-plans/traditional-and-roth-iras [1/28/20]
Top rated

Our Focus is on Your Goals!

Superior Customer Service

 

Why is it so rare? How can we make it the norm?

 

The customer experience is one of the keys to business success. In some industries, it can mean the difference between success and failure.

According to recent research by a major credit card issuer, 90% of Americans consider quality of customer service as they decide whether they want to do business with a company. Another study, conducted by a major business software manufacturer, notes that 93% of customers who get great service from a business are likely to come back and buy again.1

Still, great service remains rare. Customers who want help are often made to feel like they are inconveniencing a business. Some businesses disregard the customer experience, believing that consumers will buy largely on price or a trusted name, as if we were still in the era of dry goods stores and green stamp booklets.

Great customer service is about solving problems and meeting needs. The essentials are simply stated: a quick response, superior communication, putting the customer first. And yet, all this is often absent. As a first step to making these essentials the norm at your company, consider the following questions.

Is your business truly customer focused? Is it evolving in response to customer needs? Are you thinking of your customers and the employees in close contact with them when you think about your brand?  Paradoxically, being a customer-focused business means focusing on the experiences of your employees as well as the people who purchase your products or services.

Your employees have to adopt the mindset that they are helpers, problem-solvers for a community of people. They come to work each day to “do good,” and they are the “experts” when it comes to this kind of help; they excel at responding to a specific need.

One of the keys to instilling this mindset is to communicate the values, purpose, and mission of your business. What role does your company play in people’s lives, in the community it serves? What kind of experience should your customers have? Your employees need to hear these things from you.

What kind of community are you creating? Think of your customers and workers as m

embers of the community created around your business. Ask your customers for their opinions of your products or services; involve them strongly in your brand’s evolution and direction. Doing the same with your workers not only gives them a say, but it is also a step toward becoming leaders themselves.

What degree of customer service can your employees deliver? Do they have the authority to give a dissatisfied customer a free product, a full refund, or a unique accommodation? If not, maybe they should be empowered with some of these options. They might just change that unhappy customer into a raving fan.

Are you constantly listening to your clients or customers? If you wonder how things might change in your industry, start by talking to the people who might want to see some change: the consumers. Gather steady feedback from your clients or customers to learn what they want and need now, as opposed to what they wanted and needed years ago when you opened your doors. What you learn may lead you to revise your business plan or direction, and the input will definitely refine the way that your company responds to your customers.

Best customer service

At Riverfront Financial we pride ourselves in being 100% customer focused. Our goal is to work along side you for the long run, to help you achieve your current and future financial goals, and to make sure your family has the right protection with the right Life Insurance policies in place.  Call us anytime to schedule a meeting, we are always here to help and answer any questions that you may have.

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

 

_________________________________________________________________________________
Traci L. Kovacic is a registered representative of and offers securities through The O.N. Equity Sales Company, Member FINRA/SIPC, One Financial Way; Cincinnati, OH  45242; (513)794-6794
Riverfront Financial and The O.N. Equity Sales Company are unaffiliated companies

 

Citations.
  1. HubSpot, July 20, 2020