What Robin’s Reading: February 2016

Robin Weingast Reading RecsFebruary may be the shortest month of the year, but there’s still plenty going on to keep everyone busy. In keeping with Valentine’s Day, this month we’re reading up on how couples can successfully (and peacefully) manage their finances.

Anyone who’s ever been in a relationship knows that both merging and co-managing finances can be a source of stress and tension. We’ve been reading a recent study by Money magazine that revealed that 70% of couples fight about money above any other topic in their relationship. The study points to a key reason for this arguing: four out of five of us say we’re on the same page as our partner about finances, but when you dig a little deeper, the gaps and differences begin to show up. An overwhelming majority of respondents said they were much better than their partners at managing every aspect of finances – from paying the bills to handling retirement planning. In addition, most respondents would describe themselves as  “savers” and their partners as “spenders.” These misconceptions make conversations spiral into arguments, which makes future financial talks even less appealing and less smooth.
Robin Weingast love and finances
Is there any hope to bridge these gaps? For starters, it’s helpful to know how to approach financial conversations. We found this video and article a helpful place to start. Most experts recommend making a commitment to consistently bring up the topic of finances, in a way that’s free of judgement and criticism. In some ways, the conversation has to be approached the way you would handle a professional meeting in your workplace — focused on the shared goals and end results, without getting overly personal. It sounds like easy advice, but we all know that when money comes into the conversation, keeping the tone business-like is easier said than done. In some cases a professional adviser may be a good idea. Having a third-party there – especially one who knows what your shared goals are — can help keep the conversation focused and can stop a couple from veering into personal attacks that are counterproductive to achieving financial harmony.

Our team has also been visiting this comprehensive “Love and Money” online portal, which offers couples-themed advice on topics including talking finances and understanding how income gaps affect your relationship.
If you’re looking for some outside help to bring some financial harmony to your life, The Robin S. Weingast & Associates team is ready! We’ve been working to keep couples on track with their financial goals for over 30 years and would be happy to sit down with you and your partner. Make an investment in your relationship and contact us today.

What Robin’s Reading: May 2015

Robin Weingast Reading RecsWelcome to a new installment of “What Robin’s Reading,” our bimonthly feature that highlights what the Robin Weingast team is reading to stay current and up-to-date on the issues that will most impact our clients and their benefits planning.

This month we’re reading “Big threat to small biz workers in Obamacare case” and “States Scramble for ‘Plan B’ Ahead of Court Ruling on Obamacare.” This June, the Supreme Court will rule on King v. Burwell, a case that could alter the Affordable Care Act for the almost 8 million people in 24 states who rely on the federal exchange. Pending the ruling, millions of Americans stand to lose their subsidized coverage.

In a “Need to Know” post from last year, we explored how small businesses benefitted from the Affordable Care Act. With this ruling on the horizon, small businesses are particularly vulnerable to any changes to Obamacare. In the meantime, states are preparing for the ruling by creating workaround solutions that would ensure those covered under the Affordable Care Act don’t lose their healthcare coverage.

The Robin Weingast & Associates team is carefully watching to see how the ruling will impact all businesses — small or large. If you have questions, please contact us; we’re here to help.

Need To Know: 2015 Pension Plan Limits

It’s a new year and that means something important for your retirement plan – new contribution limits. In 2015, the IRS has raised pension plan limits to reflect cost-of-living increases. There are new limits for 401(k)-related plans as well as others. We’ve summarized the new limits (and given you a six-year overview of plan limits) in this helpful chart:Robin_Weingast_Plan_Limits

Based on these new limits, it’s more important than ever for you and your employees to review your retirement plans. The Robin Weingast & Associates team is here to help you understand the new limits and make sure you maximize their potential and opportunities. Contact us today to make sure your benefits are working for you.

Resource of the Month: Choosing a Retirement Solution for Your Small Business

Robin_Weingast_small_businessThere are over 27 million small businesses in the United States, and small businesses have accounted for 64% of the country’s job creation in the past 20 years. A small business is an independent company with fewer than 500 employees, and it’s becoming clear that small businesses are a vital part of the economic landscape.

The Robin S. Weingast & Associates team knows that small business owners are often so busy with the day-to-day realities of running their companies that it can be a challenge to find time to focus on other important areas – areas like employee benefits. That’s where we come in: using our 30 years of expertise, we work with small business owners to create custom plans that are tailored to each company’s specific goals and needs.

A key part of an employee benefit plan is a retirement savings plan. Retirement savings plans are not only beneficial as recruitment and retention tools, they also offer significant tax advantages to business owners. They are the cornerstone of a strong employee benefit plan, which is why this month’s resource is devoted exclusively to that topic. If you’re a small business owner, than download “Choosing a Retirement Solution for Your Small Business” today. This guide from the IRS offers a thorough look at the advantages and options that small business owners have for offering retirement plans.

Download “Choosing a Retirement Solution for Your Small Business” today.

If you’re a small business owner who wants to make sure you’re offering a competitive and financially advantageous benefits package to your employees, then download our resource and contact us today. Our team of experts will evaluate your current plan and recommend changes that work for you, your staff, and your bottom line.

The Robin S. Weingast & Associates “Resource of the Month” is a monthly feature that offers a resource guide about an important aspect of your business—including retirement plans, life insurance policies, and much, much more. Each resource guide that we feature will be available for you to download so that you can access our Resource of the Month whenever you need it. It’s the knowledge you need, right at your fingertips! Explore our Resource of the Month series.

Need to Know: Five Things You May Not Know About Your 401 (k)

Robin Weingast can help with 401 (k) planningAt Robin S. Weingast & Associates, we believe a large part of our work is keeping our clients well informed about the insights and trends that will help them achieve their business goals. We also believe that we have a responsibility to pass along tips and to help shatter myths that may be preventing our clients from succeeding. Our team of experts is constantly reading and staying up-to-date on what’s happening with the IRS, employee benefits, and more.

This month we’re talking 401 (k) plans, which are a well-known – but often not fully understood – retirement plan option that many employers offer. If you need a refresher on exactly what a 401 (k) is, we recommend this basic overview.

Now that you know the basics, here are five things you may not know about your 401 (k):

1) If you leave your job, you can roll your 401 (k) over to an individual plan with no tax penalty.
Many people think that any 401 (k) distribution will incur a penalty, but that simply isn’t the case. If you change employers, any plan will allow you to roll over to an established IRA. If you have multiple plans, it’s best to consolidate them.

2) Your 401 (k) is creditor-protected by law
The great thing about this is that your 401 (k) funds are protected – no matter what. That’s why we advise our clients never to use their 401 (k) funds to pay off a debt or avoid bankruptcy. Your funds will be protected, and you should only use them for retirement.

3) Age 55 is important
Most people assume that age 59 1/2 is the point at which they can begin receiving distributions from their 401 (k) without the standard 10% early withdrawal penalty. However, there are certain instances when you can receive distributions beginning at age 55, particularly if you leave your employer after 55 but before 59 1/2. Make sure you discuss these provisions with your plan provider.

4) Using an automated portfolio is a smart strategy
As much as we might want to pick-and-choose our own investments, most plans offer incredibly valuable automated resources. In some instances you simply select a year that aligns most closely with your anticipated retirement date and your plan will allocate your assets across many platforms and the plan will adapt over time as you near your retirement date. In other cases, you may need to articulate how aggressive or conservative you wish to be with your investments, and the plan will compile an appropriately aligned portfolio of investments. Whatever is available, an automated plan makes sense and makes life much easier.

5) Consider Stable Value Funds
If you are close to your retirement (or even if you’re not), consider allocating some of your 401 (k) assets to a Stable Value Fund, which is a special class of fund that most plans offer. The value won’t vary with the market nor will it be impacted by adjustments to interest rates the way bond funds do. As you get closer to retirement, it may make sense to move a few years’ worth of anticipated funds into a Stable Value Fund, so that you can at least have the peace of mind knowing that your first few years of retirement income will not be impacted by market variables.

Need additional assistance managing your 401 (k)? The Robin Weingast & Associates Team is always available. Contact us today. We’re happy to help and happy to answer any questions!

Source: http://money.usnews.com/money/blogs/the-smarter-mutual-fund-investor/2014/05/19/7-things-i-wish-people-knew-about-401k-plans

Resource of the Month: Traditional Defined Benefit Plans

Robin Weingast Defined Benefit PlanDid you know that with a Traditional Defined Benefits Plan (DBP) you can accrue substantial benefits, even within a short period of time or if you retire early, and that your benefits are not dependent upon asset returns?

These are just a few of the many positive features of a DBP. Before you decide if a plan is right for you, your company, your employees, and your long-term business goals, we think it’s important that you have all the facts. That’s why our July Resource of the Month will give you a comprehensive overview of traditional Defined Benefit Plans, how they work, and their advantages.

As our Resource explains, the most basic explanation of a Defined Benefit Plan is that an “employer contributes an actuarially determined amount sufficient to pay each participant a fixed or defined benefit at his or her retirement.”

In truth, there’s much more to Defined Benefit Plans. Our July Resource of the Month will walk you through how they work, how benefits are defined, additional considerations, maximum benefits, and the advantages of DBP for both you and your employees.

Download the full guide today.

A Defined Benefit Plan may be a great fit for your business and may also help you meet your financial goals. Download our resource today and when you’re ready to talk more about a plan that’s right for you, contact the Robin S. Weingast & Associates, Inc. team. We’re happy to put our combined experience and expertise to work….for you.

Robin Weingast & Associates Cash Balance Series: Putting Cash Balance Plans in Context

Robin Weingast Putting Cash Balance Plans in ContextDefined Contribution Plans

Before we can really discuss what a Cash Balance Plan is, it’s important to have some general background information to put the discussion in context. A defined contribution (DC) plan, such as a 401(k) profit sharing plan, dictates the contributions that go into the plan each year. Contributions, which are usually discretionary, include employee salary deferrals, employer matching contributions and employer profit sharing contributions. The maximum amount a participant can receive in a DC plan each year is $49,000 for those under age 50 and $54,500 for those age 50 or older. These contributions and the investment returns they generate determine a participant’s ultimate retirement benefit.

A defined benefit (DB) plan promises a benefit using a formula that is usually based on compensation and years of service. For example, a DB plan might provide an annual benefit equal to 1% of average compensation for each year of service. If a participant has average compensation of $65,000 over 10 years with the company, the annual benefit is equal to $6,500 ($65,000 x 1% x 10 years of service) for the rest of the participant’s life.

Rather than limiting contributions, the IRS limits the maximum annual benefit a DB plan can provide to a participant to $195,000 per year. The contribution is a function of how much is needed to fund the promised benefits. While there are a number of variables, the following table summarizes the tax-deductible contributions to fund maximum benefits for DB participants of different ages:

Robin Weingast and her team can provide you with all the information you need about Cash Balance Plans

The employer is said to bear the investment risk because the higher the return on investment, the lower the portion of the funding that must come from the company and vice versa. To the extent a DB plan is not fully funded, contributions are generally required each year.

The next part of our series will focus on clarifying what a Cash Balance Plan is, and explaining various important elements. If you missed Part 1 of our series, you can catch up here.

If you have questions about Cash Balance Plans and if they are right for your business, the Robin Weingast Team is here to help. Please contact us and we would be happy to answer all of your questions.

A Special Series from Robin Weingast & Associates, TPA: Cash Balance Plans

Robin Weingast has all the information you need about Cash Balance PlansCash balance plans have enjoyed a recent resurgence in popularity. However, these plans, which can provide tax-deductible benefits as much as five times greater than 401(k) profit sharing plans, have actually existed for more than 30 years. When the Pension Protection Act of 2006 (PPA) resolved much of the legal uncertainty of these plans, small and large companies alike showed a renewed interest. According to a recent research report, the number of cash balance plans increased by more than 23% from 2006 to 2007 and more than 75% of existing cash balance plans are sponsored by companies with fewer than 50 employees.

In our special “Need to Know” Series on Cash Balance Plans, the Robin Weingast & Associates team will walk you through everything you need to know about these popular plans.

As always, the Robin Weingast & Associates team is here to help. If you have any questions about cash balance plans, please contact us and we’ll be happy to help. 

Need to Know: Getting a Copy of a Prior Year Tax Return or Transcript

Robin Weingast Tax ReturnKeeping copies of your tax returns is a smart habit. In addition to needing them for any questions the IRS may have, you will most likely need tax returns to apply for a home mortgage or if you and/or a dependent apply for a student loan. If you haven’t kept copies, the IRS can help you get a copy of a return or even a transcript of other tax information you might need.

What is a tax transcript?

There are two kinds of tax transcripts:

1. A tax return transcript shows most line items from your originally submitted return s well as accompanying forms and schedules you may have filed. It does not include any changes made after filing
2. A tax account transcript shows any changes that you or the IRS made to your return after filing. This transcript includes marital status, return type, adjusted gross income, and taxable income.
It’s important to understand that these are not actual copies of your filed, processed tax returns.

How can I get transcripts from prior years?

Getting transcripts is free, and you can get them for the current year and past three years. You can order transcripts:

Online at IRS.gov, using the “Order a Transcript” option (link: Order a Transcript tool)
• By phone at 800-908-9946, using their menu options
• By mail, by completing a Form 4506T-EZ, Short Form Request for Individual Tax Return Transcript. Businesses and individuals who need a tax account transcript should use Form 4506-T, Request for Transcript of Tax Return. The forms are available online, or by calling 800-TAX-FORM

What if I need a copy of my processed, filed tax return?

For a fee* ($57 per copy), you can obtain a processed, filed tax return. Simply complete Form 4506 and mail it to the address listed for your area.

In general, you can obtain a current year’s return as well as returns from the past six years, but these requests may take up to 60 days to fulfill.

*If you live in a Presidentially declared disaster area, the IRS may waive the fee to obtain copies of your tax returns. Visit IRS.gov and select the ‘Disaster Relief’ link in the lower left corner of the page for more about IRS disaster assistance.

For more information

If you’d like to understand this process step-by-step, you can watch the video How to Request a Copy of Your Tax Return.

Have more questions?

The Robin Weingast team is well versed in the many resources that are available to business owners and individuals. Contact us today for a free consultation. 

Questions about Required Minimum Distributions?

Robin Weingast money imageRequired minimum distributions (RMDs) are the amounts that a retirement plan owner is required—by law—to withdraw each year. Here’s what you need to know about RMDs:

When are RMDs required to begin?
Typically, you will need to begin making annual distributions starting the year that you will turn 70 ½ years old, or the year in which you retire. What this means is that if you are 70 ½ and still work for the company with which you have your 401(k), you will not be mandated to take an RMD from that account.

Important exception: If you own at least 5% of the business that sponsors the retirement plan, you will need to begin making the RMD once you are 70 ½, whether or not you are working.

Do RMD rules apply to all kinds of retirement accounts?
RMD rules apply to:

1) Traditional individual retirement accounts (IRAs)
2) IRA-based plans including SEPs, SARSEPs, and Simple IRAs
3) All employer-sponsored retirement plans including 403(b), 457(b), 401(k), and profit-sharing plans

Important exception: RMD rules do not apply to Roth IRAs (while the plan owner is alive), but DO apply to Roth 401(k) plans.

When do RMDs need to be made?
If you have any IRA account, RMDs must be made by April 1 of the year following the year you turn 70 ½, even if you are still employed. After that, RMDs must be made by December 31 of each year.

How do I calculate my RMDs?
The IRS offers several worksheets and resources to help you understand the amount of your RMD.

Please note: IRA owners have to calculate separate RMDs for each account, although the entire amount can be taken from one or more of the IRAs. However, RMDs from plans such as 401(k)’s must be taken individually from each account.

What else do I need to know about RMDs?
There are some other important elements to RMD requirements:

1) If the plan or IRA owner dies, there are different distribution rules for beneficiaries.
2) If you are still employed and need to make RMDs, your employer still has to contribute to your plan, and you must be given the opportunity to make salary deferrals, plan permitting.
3) If your distributions fall below the RMD requirements, then you will be subject to a tax equal to 50% of the undistributed RMD.

Have more questions?
The Robin S. Weingast & Associates team is here to help. We have over 30 years of experience helping our clients with their benefits, retirement, and investment needs. Contact us for a free consultation today.

Content for this post came from this article.