Finishing Well in 2018: The Tax Show

Welcome to finishing well brought to you by Cardinal guy.com certified financial planner Schild best-selling author and financial planner helping families finish well over 40 years of finishing well will examine both biblical and practical knowledge to assist families in finishing well, including discussions on managing Medicare IRA long-term care life insurance and investments and taxes. Now let's get started. Finishing well since and is 28 working finish well on finishing with finishing 2018 started tax wise. But before we forgo their bonds and was certified for mental planner harm style. I thought about the ultimate finishing well right what would be what would you say is the ultimate finishing well of course Jesus right yeah and so hot. Jesus finish well. He actually is sixth word from across the seventh word was into your hands I commit my spirit. Meeting dad. I'm given all this back to you now if you ever compare that to creation. And when God finished on the sixth day like Jesus finished his work on this six word on the sixth day God said, you know, it's very good.

And then he rested and so as we look at the end of 2018 oh I should not say this because it's one of my favorite things in Scripture Isaiah 11 were given the seven anointing of the Holy Spirit the seventh anointing is a delight in the fear the Lord and I picture that like yeah into your hands I commit my spirit all you got this no matter what working to finish well because what and he's got this but it does kinda fund that he gives us money and stuff to Stuart so that he can give us experiences like we have this time year bonds and so finishing well when you're in retirement and with your taxes.

It's kinda cool to see God gives us wisdom. If we decide to tap into it, which is actually the first morning of the Holy Spirit so gives them wisdom okay so it's the end of the year 2018 and what really at request and request by a listener. What we do here in the end of the year and what I would say is you got until December 31 to recognize income or to create deductions in the year 2018 is if you put it off after that. Just what to say happy new year and it's good to be in 2019.

So this is a bit of a year-end tax planning strategy session for retired people. Well, that which is finishing well that's where show is so the seventh content chapter in the book chapter 8 original book is taxes for the 62+ and so what we all look at here is planning so we really don't want to put off till the end of the year doing all these things, but we're going to talk today about what you can do between now and the end of the year and the first thing is to come up to my mind, wired minimum distributions are MDs which we talked about on several shows.

You got to the end of the year to do your 20 2018 required minimum distribution. If you haven't already done it, then we need to get on that, like right now because you don't want to be sending that to your custodian IRA custodian on 30 December in Santa Ana need to get this done before the end of 2018. Lotta custodians have a minimum of a week.

Some of them 10 days where they're going to say this time a year where everybody's, that same boat. Yes over to talk about the required minimum just because is required out of your IRA or 401(k).

If you got some money sitting on the side.

We need to make sure that that business.

Take care. Furthermore, we want to know that maybe we just maybe we've already taken care of, and we got the required minimum you know when people get into my reading in the subscribe to some of my philosophies taking just the minimum isn't necessarily the best thing to do and so he just got this little bit of 2018. So if you want to do some planning. There's many of you that are sitting on IRA money. Maybe you're not even at minimum distributions you still in your 60s. You don't need to spend it, but you may be surprised. I would suggest anybody do this on their own, but we may calculate that we could pull a few thousand dollars on your IRA and it wouldn't have a huge tax consequence to you may be better to do that before the end of the year and then to do a little bit 2019 and a little bit. So for so when it comes to the whole area of IRAs we got first required minimum usage, then we want to have possibly deducting some in excess of the minimum or if you're under 70 1/2 just flat taken one and I be more and happy to help you calculate that and make sure that you're not doing something wrong, then we have the whole issue when it comes to IRAs of Q CDs qualified charitable distribution out to do these got me over 70 1/2 stars and then secondly you can give money directly to your church and the limit on that or church or any other charitable organization because were Christian radio show I talk at church year but said 401(k) 501(c)(3). When they had all those acronyms but the bottom line is you can give money to God's kingdom through your IRA and it'll never show up on your tax return so we can look at other shows, you get information on my website Cardinal guide deck. You can pull down the book in the workbook. You can read that strategy a little bit if I'm understanding is that if I had a particularly low income year then my taxes are going to be lower this year than normal so I may be able to fit some of that IRA distribution money and without paying little or no tax. And so I'm I could just push that move money over to a savings account.

Having paid tax on it and I'm setting up a reserve of untaxed untaxed money out of my IRA and there's a lot of seniors that have fairly low income year every year because they live off of their Social Security checks okay and so and possibly some savings.

They don't have to pay taxes on just money the world where they can pull out by things not taxable income. So you don't pay taxes on your Social Security unless you have a bunch of other income and so there's many folks that have money sit in an IRA and they it's just sitting there and they don't really intend to spend it there. Angered by the minimum distributions to begin with. Or maybe they're not even angered yet because they're in their 60s and the money sitting there so the point is that if you don't have a lot of other income such as Social Security, it may be wise for you to pull out a certain amount on your IRA and just pay the taxes on it which are to be very low right versus say this, but if you were to pass away and all of a sudden your heirs got this IRA it's on tactic and I want the money but the tax on it when you could have been paying out this money into a savings account that they could inherited without the tax. If you had been doing it. We even have strategies that involve life insurance just a little bit every year you pay the premium into a life insurance company and show them there's a big pool of money available for your heirs, which is also a text which is tax-free plan strategies on that so I want to get back and talk about the Q CD and because I know you become very familiar with this, but I'm thinking the number of our listeners may not have listened closely. So if you're over 70 and you qualify for. So I don't really want anybody doing this without talking to a professional like me, you can give up to $100,000 a year onto your IRA, give it directly to the charitable institution which were talking about. Here's the church or your church mission something in the kingdom of God that will further that your choice you can give the money directly from the IRA which is through a Q CD and is never to sharpen your tax return so we got to get the whole thing will have to give $100,000. It's just you got a few weeks left where you could actually do that in 2018. Access your right that's more finishing well wisdom from certified financial planner Hongqiao. Of course everything were always talking about this from his book the complete Cardinal guide to planning for a living in retirement and that way it's also available at the website Cardinal.you got to put the guide. After Cardinal something about the bird Cardinal guide.com the seven worries tab and and today show, which is income taxes is specifically for the 62-year-old plus income taxes. We've put both the chapter of both books that each tab so when you talk about today's taxes you've got the original book got the chapter on taxes and then you have the workbook. The chapter on taxes.

We put them up there and PDFs. They can be downloaded for free construct. Most most of the whole book for free if you want to send me a text or an email or call me up and tell me you listen to the show and you like a copy of the book. I'll be glad to send you one.

No charge. If you're one of these people that like to remain anonymous to figure out what were all about by the book on Amazon. Expansive salinity, would we just want to get the information in the teaching out.

As I told you, and a lot of things work doing the show out some churches people clients and invited us out listeners and invited us out. I don't have to worry too much about promoting myself if I just teach this stuff, people end up following the outdoors seen in several of these occasions, so we just want to get the book to write and and again my hope Q CD concept is building the kingdom and its wisdom, God gave us the discernment to finish well. We use these resources which are goals that so next up we got to CDs.

What else is 2018.

We need to be thinking about as we finish up our tax year. Well Ms. Christmas time gifting me and the whole concept of the maximum gift and a $15,000 a year in all the stuff is really relevant for rich people suffer got some rich people listening or even some moderately well-off people that want to give my they're all burdened by this $15,000 limit so if you wanted to. Don't give some money to your kids or your grandkids or somebody that special to you.

Is that so that's 15,000 per year or per person per year life. You can give 30,000 of the same person 15 H such fairly liberal and if you want to give more than that, given somebody money to buy a house or something like that, then you may want to straddle it where you would give part of it. This year, and then part of next year's can see were gifting big money here finishing well today. Talk about finishing well that would make you feel like you could rest at the end of the year all my clients when they're doing estate planning they want to give some money to their kids and maybe it's just $1000.

They want to they want to give money. Mother still alive.

My mom is so we come back we got a lot more finishing well. We hope you are enjoying finishing well you by Cardinal guide.com is a Cardinal guide.com for free downloads of previous shows, including episodes about Social Security and Medicare, IRA, long-term care, life insurance, investments and taxes as well as Han's best-selling book the complete Cardinal guide to planning for and living in retirement. Plus the accompanying work if you want to follow along with today's topic download free PDF Cardinal guide.com by going to the seven worries tab of today's show topic, just scroll down to useful documents once again for free resources shows Han's book the complete Cardinal guide to planning for and living in retirement. Cardinal guide.com you have a question, comment or suggestion for future shows.

Click on finishing well radio show and send us a word. Once again that's Cardinal guide.com Cardinal guide.com now finishing well by Cardinal guide.com. We are having now is where actually talking about finishing well taxes 2018.

As certainly God finished well in creation in Jesus finish.

Well there's a lot of wisdom that's there to be had and it's kind of exciting to see some of these strategies Hans but a lot of it just centers around Social Security. Will it doesn't so the first part of the show. We talked about some quick tips that could help you have some effect on your urine tax bill. Both recognition of income.

Perhaps some deductions, but as a strategist and is a financial planner.

I'd really rather just talk about. Okay, so how could we generally lower your taxes over the rest your life, you're right here, right and something that almost every one of our clients has Social Security check every month and then 12 of those during the year and then we got a place that their consistently somewhat in the dark about I see with my clients is that how much taxes do I really pay on my Social Security and I think that's an area of education that we get beyond tips and not try to teach everybody in the next 10 minutes what that is or given the learning but I won't point toward it.

I want to talk about a little bit need to understand what the tax ramifications of getting a socialist check how much taxes are you really going up and then what can you do to minimize this and what can you do to possibly just collect more and keep more your Social Security check that Sandra now let's go okay so if you live off of Social Security and you get a check with your check is $2000 a month and you got 2000 bucks a month that's $24,000 a year and the first thing is, as most people quote their Social Security check net after the Medicare kind. So you're telling me your Social Security checks $2000 a month. It actually is probably $2150. In any case you get your Social Security that your spendable money and that's all you have. That's what you live off of you to pay no taxes on unless you live in a few states there are some states. North Carolina is not one of them that tax your Social Security.

You know, the federal government might not text Social Security states quite but the not one of those states you're going to collect your Social Security if that's all you got no taxes zero tractor now there's some thresholds depending upon whether you're married or single filing jointly, or some thresholds around the $25,000 a year amount that just really says that if you can have a little bit of other income. Simple way to say you have a little bit about what say less than $10,000. She got this $2000 a month Social Security check.

And then you got less than $10,000 of other income and met other income could be a part-time job with good investment as dividends and interest on the CD could be withdrawals from your IRA for minimum distributions. If you have a small amount of other income you're still my company taxes and secure but as soon as you exceed what is a small amount of marketing and always thresholds use people, but let's just say your Social Security plus a small amount of other income. Still no taxes on the Social Security but then you exceed that threshold now you're going to pay more taxes on the other income and then I come back and attach your Social Security tax have to figure Social Security so what that means is half of the distilled tax-free. So if you got more than a little other income surrounded.

You know now you paying tax amount. Other income and then you be paying tax on half your Social Security and then that's just a progressive thing that if you're Mr. big box here Robbie big box you have a big Social Security check. And then you got a big other income and you got a sizable other income. Now you're going to be paying taxes on that other income.

Of course plus up to 85% of your Social Security checks start. So even Mr. big box which is not new but were just Mr. he still got her.

She still has Mrs. box as 15% of her Social Security check still check for what I really explain this to high income people.

They know they know they've paid the most of the Social Security paid the most taxes and now they're paying on the most in their Social Security check, but that's also would have her arm send them over the top. It's a Medicare tax, and they have the fancy acronym and fancy words but boys you you you want to get some very high income people anchored his room. There's a reason they don't know how all this stuff works because it just makes paying a lot of taxes and then they're paying taxes on their Social Security and then was a good bit. What's left. They send out for what is called a premium to Medicare or premium surcharge, which is her so you got that. I have to tell a story okay because if you're sitting there right now just burning.

I want to think about what I work for Royce Reynolds, who owned all the crown group and we had gone through a horrible year whatever year was the crisis and lots of the stores were losing money if I could just pay those taxes again. If you're paying a lot of taxes. God bless you. You probably doing okay. We are and I can help you plan so we can make those the smallest that they can possibly be. But I certainly can make him go away.

That's a big part of our business is tax planning and where I get a lot of joy in my job is sitting down with people that are Mr. and Mrs. big box there just regular folks, you know, got some retirement savings and I got some other savings and got some Social Security income and you know they don't describe themselves as rich some of their neighbors might simply because they have accumulated things like a lot of my joy out of sitting down with them and trying to make. Be smart about all the stuff because one of the ways you can not pay taxes on your Social Security is spend your money out of just nonqualified savings. So if you have a savings account have money that you own stocks and their held out of an IRA and you live off of that you're actually having income. That's not creating taxable income. Maybe have a whole year where you could have a tax-free Social Security check and deferring taxes on some of the other sites of this be the case with the Roth IRA as well as absolutely that would be another strategy is to get into the Roth IRA while you're not retired and then recognize all that income you have to pay a bunch tax then your net amount would be in that I Roth IRA and then you could live off of that live off of that partially that could not only make that money tax-free just come from a Roth, but that it would make your Social Security tax-free as well and so people come into the end of the year that that that have larger incomes like that the Roth is really good strategy. What is the thing you gotta be scientific about that like out with a lot of raw strategies. We do those over multiple years. So if you were going to do something like that your 64 now were planning to retire you would want to get in to see me quickly and we might want to execute on a Roth IRA strategy where we exercise a little that 2018 is a conversion strategy. We would you want to spread that tax over several years. It might look a lot better than in kind OF wisdom obviously helps us finish well yeah and and also the you know your heirs. Commended that because they don't end up with an IRA that has all this text sure. Just in the general area of taxes, you know, if you look at a lot of insurance brochures insurance that we sell our annuity brochures, life insurance brochures or you look at a lot of investment pressure you see an investment commercial. Now he says we are not tax advisors.

Consult your tax advisor. I just I find that to be very odd just because how in the world could you talk about an annuity and tax deferral or an IRA that's invested and not talk about taxes so I want to make something clear on this radio show is we give tax advice. The Cardinal just we just do what will give you written text is forward-looking. We don't do taxes.

We have a CPA that were affiliated with. So if you want your taxes done will don't but that's looking backwards. And so what we do in our work is we plan we look forward and we will give you tax opinion on how some funds probably were coming.

We can't give forward tax advice with complete accuracy. But we should certainly guess that you have a very educated guess and then make some decisions based absolutely and so we are today. Talk about finishing well taxes 2018 was certified by mail financial planner Hans Schild in his book the pleat Cardinal guide to planning for living in retirement is there at the website.

Cardinal guide that, getting up at the guide with the Cardinal then goat.com and there you'll find all sorts of resources but the one we always want to point you to is the seven worries Redefined taxes is one of those.

But you know long-term care navigating Social Security are all different worries, but this one today income tax get the workbook or the book chapter) right there at the for free. You can download them as PDFs. You can get the book. If you just write to me, I'll be happy to send you one. You can also get it on Amazon stuff all over the place.

So with the few seconds we got left. If he got one last little idea that people can finish well with besides obviously getting close to the Lord throughout. I would just say listen to the Lord. Rest I've been trying to do that every day and my wife's not playing the game with scandalous Christmas preparations test she possibly get off my rear end and start doing and so I'm listening to her and doing those. But on the seventh day he did rest after it was finished. So you got to work today but then the rest was a Merry Christmas and we got a couple more weeks, but we hope you enjoyed finishing well if you buy Cardinal guide.com visit Cardinal guide.com for free downloads of the show previous shows on topics such as Social Security, Medicare and IRAs long-term care life insurance and investments and taxes as well as ponds and best-selling book, the complete Cardinal guide to planning for and living in retirement and the workbook once again for dozens of free resources past shows get Hans book go to Cardinal guide.com if you have a question, comment or suggestion for future shows. Click on the finishing well radio show on the website and send us a word.

Once again that's Cardinal guide.com Cardinal guide.com