LIFE SOLUTIONS
Retirement planning for tax efficiency
Life strategies to help protect wealth
Presenter name
Presenter title
Date of presentation
Products issued by:
The Lincoln National Life Insurance Company
Lincoln Life & Annuity Company of New York
LCN-759997-112513
For agent or broker use only. Not for use with the public.
©2013 Lincoln National Corporation
We focus on the affluent client and take a holistic
approach to wealth accumulation through protection.
Lincoln provides strategies and products to take
clients from the accumulation phase to the
retirement-spending phase, protecting wealth
so that it passes on to the next generation.
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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FOCUS ON MAXIMIZING RETIREMENT DISTRIBUTIONS
Advisors indicate that only
55% of their clients have a
retirement income plan.
Source: Cogent Research, The Cogent Discovery Series: Advisor In-Retirement IncomeTM, 2013.
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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AGENDA
Tax exposure of assets
Diversification of distributions
Wealth protection
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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TAX EXPOSURE OF ASSETS
A major factor in retirement income planning
Source: The Wall Street Journal, MarketWatch, “10 Reasons Your Retirement Plan Won’t Cut It,”
http://www.marketwatch.com/story/10-reasons-your-retirement-plan-wont-cut-it-2013-10-07, October 7, 2013.
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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TAX EXPOSURE OF ASSETS
Retirement
Not all assets
selected in the
accumulation phase
are ideal for the
distribution phase.
Accumulation phase
Distribution phase
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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RETIREMENT SOLUTIONS
Government
restrictions
401(k)s, IRAs, etc.
Tax-deferred
Municipal bonds,
Roth IRAs
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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RETIREMENT SOLUTIONS
Government
restrictions
IRS
401(k)s, IRAs, etc.
Stocks, bonds,
mutual funds, etc.
Tax-deferred
Municipal bonds,
Roth IRAs
Taxable
$$ Taxes
Taxadvantaged
Income
tax-free
For agent or broker use only. Not for use with the public.
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NEW TAX INCREASES — AMERICAN TAXPAYER RELIEF ACT (ATRA)
Government
restrictions
IRS
Top tax rate +4.6%
Medicare +0.9%
Personal Exemption
Phaseout (PEP)
& PEASE1 +10.0%
401(k)s, IRAs, etc.
Stocks, bonds,
mutual funds, etc.
Tax-deferred
Municipal bonds,
Roth IRAs
Taxable
Capitals gains +5.0%
UIMCT2 (ACA) +3.8%
$$ Taxes
Taxadvantaged
Income
tax-free
1Itemized
Deductions Phaseout (Pease) — The Pease provision (named after former Congressman Donald Pease who sponsored the legislation) reduces the value of itemized deductions by 3% of the amount that
adjusted gross income (AGI) exceeds $300,000 for joint filers and $250,000 for individuals. 2Unearned Income Medicare Contribution Tax (UIMCT) — A 3.8% surtax on unearned income for taxpayers whose total
modified adjusted gross income (MAGI) exceeds $250,000 for joint filers or $200,000 for individuals. This tax affects interest, dividends, capital gains, annuities, royalties and rents.
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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TAX EXPOSURE OF ASSETS
Government
restrictions
IRS
Distributions
401(k)s, IRAs, etc.
Stocks, bonds,
mutual funds, etc.
Tax-deferred
Municipal bonds,
Roth IRAs
Taxable
$$ Taxes
Taxadvantaged
Income
tax-free
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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TAX EXPOSURE OF ASSETS
What happens at retirement
Age
Age
59½
Ordinary
income
tax + 10%
penalty*
62
Tax-deferred
bucket
becomes
taxable
Too much
Modified
Adjusted
Gross Income:
85% of SS
benefits taxed
Age
65
Too much Modified
Adjusted Gross
Income: Medicare
Part B costs
increase from $105
to $336/month
Age
70½
RMDs add to
tax exposure
*The 10% penalty is applicable for withdrawals from qualified plan and IRA accounts before age 59 ½.
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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DIVERSIFICATION OF DISTRIBUTIONS
Diversify to protect wealth with Lincoln life insurance.
Tax-deferred growth
No contribution limits
Income tax-free distributions*
No penalties for early retirement
Nonreportable income
An income tax-free legacy
*Loans and withdrawals will reduce the policy’s cash value and death benefit.
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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DIVERSIFICATION OF DISTRIBUTIONS
Rick, age 45, $500K annual income,
purchases a Lincoln life insurance policy.
Age
Age
59½
Income
tax-free
distributions,
no penalties
62
No
income
tax
No impact
on SS benefits
Age
65
No impact on
Medicare Part B
Age
70½
No RMDs
When he dies…his family has an income tax-free legacy.
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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DIVERSIFICATION OF DISTRIBUTIONS TO THE NEXT GENERATION
Retirement
Legacy
Effective retirement
planning is focused
on distributions.
Accumulation phase
Distribution phase
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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HOW LINCOLN CAN HELP
Why Lincoln?
Our focus:
Wealth accumulation through protection for affluent clients
• Retirement income
• Long-term care protection
• Wealth transfer solutions
The breadth and depth of our product portfolio
Expertise and support for your business
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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HOW LINCOLN CAN HELP
Take charge with wealth
protection solutions for
your clients.
Contact your Lincoln
representative.
For agent or broker use only. Not for use with the public.
LCN-759997-112513
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THANK YOU
This material was prepared to support the promotion and marketing of investment and insurance products. Lincoln Financial
Group® affiliates, their distributors, and their respective employees, representatives, and/or insurance agents do not provide tax,
accounting, or legal advice. Any tax statements contained herein were not intended or written to be used, and cannot be used, for
the purpose of avoiding U.S. federal, state, or local tax penalties. Please consult your own independent advisor as to any tax,
accounting, or legal statements made herein.
Lincoln life insurance policies are issued by The Lincoln National Life Insurance Company, Fort Wayne, IN, and distributed by Lincoln Financial
Distributors, Inc., a broker-dealer. The Lincoln National Life Insurance Company does not solicit business in the state of New York, nor is it
authorized to do so.
Policies sold in New York are issued by Lincoln Life & Annuity Company of New York, Syracuse, NY, and distributed by Lincoln Financial Distributors,
Inc., a broker-dealer.
All guarantees and benefits of the insurance policy are subject to the claims-paying ability of the issuing insurance company. They are not
backed by the broker-dealer and/or insurance agency selling the policy, or any affiliates of those entities other than the issuing company affiliates, and
none makes any representations or guarantees regarding the claims-paying ability of the issuer.
Products, riders and features are subject to state availability. Limitations and exclusions may apply. Check state availability.
Not a deposit Not FDIC-insured May go down in value
Not insured by any federal government agency
Not guaranteed by any bank or savings association
LincolnFinancial.com
Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates.
Affiliates are separately responsible for their own financial and contractual obligations.
1/14 Z05
Order code: LIF-TAX-PPT002
CWI130433
For agent or broker use only. Not for use with the public.
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