Ease the tax bite on Social Security Benefits

Many people are not even aware of the possible income tax on their Social Security benefits. The tax on Social Security benefits depends on your total income and marital status. Form SSA-1099, which Social Security recipients should receive by January 31, shows the recipient’s total benefits. To determine how much tax you will owe, add 1/2 your SS benefits to all other income, including tax-exempt interest. If this amount is greater than the base amount for the filing status, a part of the benefits will be taxable.

The base amounts that will cause 50% of the benefits to become taxable are:

• $25,000 for single, head of household, or qualifying widow/widower with a dependent child
• $25,000 for married individuals filing separately who did not live with their spouses at any time during the year
• $32,000 for married couples filing jointly
• $0 for married persons filing separately who lived together

But, according to the IRS, up to 85% of the benefits can be taxable if either of the following situations applies:
• The total of one-half of the benefits and all other income is more than $34,000 ($44,000 if married filing jointly).
• You are married, filing separately and lived with your spouse at any time during the year.

THE BOTTOM LINE:
Tax savings should be an important consideration when comparing investments. In the case of immediate annuities, you may find the after-tax return on your money could be greater than what is available from other conservative fixed-income investments. In addition, you can get an income that you can’t outlive.

We can show you ways to cut or eliminate the tax on your Social Security! Call the office for your free consultation!!

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James H Willis, III– Financial Planner -Insurances

Retirement Checklist

It’s never too soon to start planning your retirement; it’s never too late to review and improve that plan to meet the ever changing challenges of life.

Are you really prepared to transition to retirement? You’ve probably already taken some steps to prepare for retirement. But have you taken the right steps to help you transition?

Utilize this simple checklist to help identify steps you may need to take before making the transition to retirement.

□ I have a good idea as to when I want to retire and I’m able to do so.
□ I have a list of the expenses I will have during retirement.
□ I talk with my financial advisors about how much income I’ll need.
□ I have a good sense as to how I’ll spend my days when I’m not working.
□ I understand my Social Security benefits.
□ I have a plan for when I should begin taking my Social Security benefits.
□ I’ve updated necessary insurance policies, including health insurance.
□ I know where my health insurance will come from once I’m retired.
□ I understand Medicare and how it works with my health insurance.
□ I’ve consolidated similar financial accounts, such as 401(k) plans and IRAs.
□ I know how much of my retirement income will come from my retirement accounts.
□ I have a good idea as to whether or not I need long-term care insurance.
□ I regularly discuss retirement goals and interests with my spouse.
□ My spouse and I have similar ideas about where and how we’d like to live.

Have you left any box unchecked? If so, it’s time to be proactive today so you get the retirement you deserve. Get on track for a successful retirement by reviewing this checklist with your trusted financial professional.

James Whitaker, PHD, Financial Planner Social Security Expert
James Whitaker, PHD, Financial Planner Social Security Expert