Take Shelter from the
2013 Tax Storm
Chad Smith CFP®, ChFC, CLU
The Impact of Taxes
Taxes financially impact most major decisions in
our lives:
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Where to shop
Where to buy property
How to invest
When we sell investments
When to retire
Where to retire
How to plan for death
• How we save
• How much we save
• Where to establish a
business
• When we give to charities
• When we give to our family
• How to plan for college
How Many Days America Works to Pay for
Various Spending Categories
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Housing and household operation
State / local taxes
Federal taxes
Health and medical care
Food
Recreation
Transportation
Clothing and Accessories
All others
Source: The Tax Foundation calculations based on data from the Department of Commerce, Bureau of Economics Analysis
Year End Planning
• December 31, 2013 is simply the last
opportunity to take many actions that can
save you taxes this year
• 2013 has seen more tax change than any year
since 2001
What Changed
• American Taxpayer Relief Act of 2012
– Passed by Congress on January 1, 2013
– Partial resolution to the tax side of the “Fiscal
Cliff”
– Continued many of the Bush Era tax cuts
What Changed
• Patient Protection and Affordable Care Act
(PPACA)
– Commonly called “Obama Care”
– PPACA is aimed at reducing the number of
uninsured Americans and reducing the overall cost
of healthcare
– The Act created several new taxes that start this
year
New for 2013
• Beginning in 2013 the health care reform law
imposes a 3.8% surtax on net investment
income for taxpayers above the threshold
– Interest
– Capital gains
– Qualified dividends
– Passive Income
• Increases in capital gains and dividend rates
2013 Year End Planning
• Annual review items
• Tax strategies
– Contribution
– Additional deferral items
– Gifting
– Timing strategies
Annual Review Items
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Family Dynamics
Health
Employment
Location (Moving)
Risk Profile
Annual Review Items
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Beneficiary review
Estate documents
Required minimum distributions
Retirement cash flow plan
Asset allocation* review and rebalance
Debt review
Insurance review
– Life, property, casualty and flexible spending accounts
and health savings accounts
*Asset allocation does not assure or guarantee better performance and cannot eliminate the risk of investment losses.
Contributions
• Employer sponsored plan
– Employees
– Employers
• IRAs
– Contributions
– Rollovers
• Roth IRA
• Non-deductible IRA
Additional Deferral Options
• Annuities
• Cash value life insurance
• Tax efficient investments
Gifting
• Charitable contributions
– Outright gifts
– Charitable trust planning
• Gifts to family
– Outright gifts
– Gift to trust for the benefit of your family
• College savings
– 529 plans*
*By investing in a plan outside your state residence, you may lose available state tax benefits. 529 plans are subject to enrollment, maintenance,
administration/management fees & expenses. Make sure you understand your state tax laws to get the most from your plan. If you make a withdrawal for any other
reason, the earnings portion of the withdrawal will be subject to both states and federal income tax & a 10% federal tax penalty. As with any investment, it’s important to
fully consider the plan’s objectives, risks, charges and expenses before investing.
Timing Strategies
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Tax loss harvesting
Dividend and capital gains review
Payment of estimated state tax and local taxes
Distributions from retirement plans
Roth conversion
For business – the timing of expenditures
Stock options
Bonus income
Action Items
What you should bring for a comprehensive review?
Investment accounts
(excluding HD Vest accounts)
Current statements showing value and positions (stocks, bonds, mutual funds, CDs, money
markets, etc.).
Bank accounts
Current statements showing value and positions (CDs, money markets, etc.).
A list of your other assets
Homes, personal property, rental property, collectibles, etc.
A list of your liabilities
Debts, mortgages, loans, etc.
Social Security information
• Statements you may have received with an estimate of earnings at retirement.
• Current contributions
• 401(k)s, IRAs, savings accounts, etc.
All sources of income
Salaries, pension plans, annuities, trust funds, rental income, etc.
In Summary
• Annual review items
• Tax strategies
– Contribution
– Additional deferral items
– Gifting
– Timing strategies
Action Items
• Schedule your annual review
Contact HD Vest
To download the PowerPoint presentation for
this live webinar visit hdvest.com/reinvent18
or call (800) 742-7950.
H.D. Vest Financial Services® is the holding company for the group of companies providing financial
services under the H.D. Vest name.
Securities offered through H.D. Vest Investment ServicesSM, Member: SIPC
Advisory services offered through H.D. Vest Advisory ServicesSM
6333 N. State Highway 161, Fourth Floor, Irving, TX 75038 972-870-6000