Tag: retirement planning

Divorce is challenging. Navigating both the emotional and financial complexities of a divorce can be difficult since divorce is not something a person regularly goes through. Some helpful news, though, is that facing the impact of marital dissolution on your tax situation is something a little advance knowledge can assist with. CBM’s divorce financial planning team has provided the following insights to make managing a tough situation a little easier. Easier does not mean easy. Should you have questions about… Read more ›

In a surprising move, the IRS announced that the SECURE 2.0 rule, which stated that catch-up contributions for high earners must go into Roth accounts, will be delayed until 2026. Originally scheduled to start in 2024, the delay provides a window for employers’ retirement plans to comply with the law and employees to reap the tax benefits of current catch-up contributions. The rule requires employees aged 50 or above, who earned $145,000 or more the previous year, to direct their… Read more ›

Recent reports have raised anew concerns about the impending insolvency of the Social Security program, absent congressional action. Social Security reform has long been considered a “third rail” of American politics and understandably so — the options for heading off insolvency will inevitably cause pain for significant segments of the population. Yet some in Congress have stepped forward with proposals that aim to tackle the problem. The Impending Shortfall Social Security currently provides benefits to more than 66 million recipients. The Congressional… Read more ›

Many job seekers and others assume that not-for-profit organizations offer fewer or less-generous fringe benefits to employees than for-profit companies. But that’s not necessarily true. According to a recent survey by the Nonprofit Times, 87% of nonprofit employers offer a health insurance plan. But as the Kaiser Family Foundation has found, only 49% of private for-profit companies with three to nine workers offer health insurance coverage to workers. Larger for-profit companies generally do offer health insurance and other benefits. So… Read more ›

Get the most from Social Security. Younger retirees face a harsh penalty for working part-time. For every $2 earned over $19,560 in 2022 (up from $18,960 in 2021), you lose $1 in Social Security benefits. In the year you reach full retirement age, a higher earnings threshold applies. Your benefits will be reduced by $1 for every $3 of earnings only when earnings exceed $51,960 in 2022 if you reach full retirement age (up from $50,520 for 2021). After you… Read more ›

Sooner or later, your firm will encounter the issue of buying out a partner. This may be due to the partner’s retirement, death or other reasons. The federal income tax rules for partnership payments to buy out an exiting partner’s interest are tricky, but they also open up tax planning opportunities. The Basic Tax Rules Payments made by a partnership to liquidate (or buy out) an exiting partner’s entire interest are covered by Section 736 of the Internal Revenue Code…. Read more ›

When planning a trip, you probably focus on making the travel arrangements, ensuring you’ll have enough spending money and other practical issues, such as having someone cover you at the office and someone else keep an eye on your house or pets. The last thing on your mind may be putting your financial and other personal documents in order. However, if you expect to be away for any length of time — especially if your loved ones won’t be traveling… Read more ›

For 2022, the amount you can sock away into your 401(k), 403(b) and most 457 plans will rise another $1,000 to $20,500. If you’re at least 50 years of age, you can put away up to $27,000 thanks to catch-up contributions. The limit on “total additions” to those plans — that is your deferrals and employer contributions combined — rises to $61,000 in 2022 or $67,500 if you’re at least 50. While you’re contemplating how much to put into your… Read more ›

The 403(b) plan is often thought of as a 401(k) plan for nonprofits. It’s probably not the only option for your not-for-profit, but it can provide certain advantages over 401(k)s. Following is a brief rundown. Generous Contribution Limits A 403(b) plan is a tax-favored qualified retirement plan set up for employees of not-for-profit organizations, including charities, hospitals, schools and government entities. As with other qualified plans, pre-tax contributions grow tax-free until withdrawals are made. Normally, employee contributions are deducted from… Read more ›

Back in late 2019, the first significant legislation addressing retirement savings since 2006 became law. The Setting Every Community Up for Retirement Enhancement (SECURE) Act has resulted in many changes to retirement and estate planning strategies, but it also raised some questions. The IRS has been left to fill the gaps, most recently with the February 2022 release of proposed regulations that have left many taxpayers confused and unsure of how to proceed. The proposed regs cover numerous topics, but… Read more ›