Financial Advisory Services
Our expertise is in utilizing integrated tax & investment strategy to spot strategic opportunities for both your business and for you as an individual.
Every client has a written, personal plan
If you’re like many people, you may have left your investments on autopilot. You recognize the value in investment planning, but may find it too intimidating to tackle on your own.
Chances are you have had changes in your life since you last reviewed your investment portfolio, and the investment strategy that once was adequate for the future you had in mind may no longer be appropriate. As your financial goals and needs change, your investment strategy may need to change to meet those goals and needs.
Remember that your investments affect other elements of your financial plan such as estate planning, education planning, and retirement planning.
Income Protection & Asset Preservation
For most people, the possibility of an illness or injury severe enough to disrupt their income flow doesn’t even occur to them. If they do think about it, people often consider the chances slim. Many go through life with the “it will never happen to me” mentality.
The truth is that illness or injury can happen to anyone. In fact, a person has a one in four chance of becoming severely ill or disabled. Perhaps you’ve considered this possibility and put some plans in place. If you have already taken steps to protect your income, when is the last time you reviewed your plan? Chances are you have experienced changes in your life since you last reviewed your finances. You may have gotten married or divorced, welcomed a child or grandchild, acquired or sold a business, received a new job or earned a promotion, or taken on new future financial obligations.
As your financial goals and needs change, your strategies to protect them may need to change. Remember that income protection affects other aspects of your planning process, including investment planning and insurance planning. Because your lifestyle and that of your family depend on your income, it is important to regularly review your specific goals, and actively plan for the possibility of severe illness or injury.
No “cookie cutter” approach
You may look forward to retirement as a time to savor the finer things in life, and as a reward for many years of hard work.
Retirement dreams can inspire you, but you need to set goals if your retirement is to live up to your aspirations.
We can help you start addressing the challenges planning for your retirement holds. We can analyze your current retirement plan and help make sure you are working steadily towards your goals.
Securities offered through 1st Global Capital Corp., Member FINRA, SIPC. Investment Advisory services offered through 1st Global Advisors, Inc. Jones & Roth has representatives licensed in AZ, CA, CO, FL, GA, HI, IL, IN, MA, MT, NC, NV, OH, OR, TX, UT, WA & WY. This is not an offer to sell securities in any other state or jurisdiction.
Financial Advisory Services Team
Matt Adams, CFP®, CLU, ChFC
CERTIFIED FINANCIAL PLANNER™
Mark Coombe, CFP®
CERTIFIED FINANCIAL PLANNER™
Bryan Decker, CFP®
CERTIFIED FINANCIAL PLANNER™
Get in touch with us.
Last year you may have made significant gifts to your children, grandchildren or other heirs as part of your estate planning strategy. Or perhaps you just wanted to provide loved ones with some helpful financial support. Regardless of the reason for making a gift, it’s important to know under what circumstances you’re required to file a gift tax return.
Some transfers require a return even if you don’t owe tax. And sometimes it’s desirable to file a return even if it isn’t required.
When filing is required
Generally, you’ll need to file a gift tax return for 2016 if, during the tax year, you made gifts:
• That exceeded the $14,000-per-recipient gift tax annual exclusion (other than to your U.S. citizen spouse),
• That exceeded the $148,000 annual exclusion for gifts to a non-citizen spouse,
• That you wish to split with your spouse to take advantage of your combined $28,000 annual exclusions,
• To a Section 529 college savings plan for your child, grandchild or other loved one and wish to accelerate up to five years’ worth of annual exclusions ($70,000) into 2016,
• Of future interests — such as remainder interests in a trust — regardless of the amount, or
• Of jointly held or community property.
When filing isn’t required
No return is required if your gifts for the year consist solely of annual exclusion gifts, present interest gifts to a U.S. citizen spouse, qualifying educational or medical expenses paid directly to a school or health care provider, and political or charitable contributions.
If you transferred hard-to-value property, such as artwork or interests in a family-owned business, consider filing a gift tax return even if you’re not required to. Adequate disclosure of the transfer in a return triggers the statute of limitations, generally preventing the IRS from challenging your valuation more than three years after you file.
Meeting the deadline
The gift tax return deadline is the same as the income tax filing deadline. For 2016 returns, it’s April 18, 2017 (or October 16 if you file for an extension). If you owe gift tax, the payment deadline is also April 18, regardless of whether you file for an extension.
Have questions about gift tax and the filing requirements? Contact us to learn more.
Incentive stock options allow you to buy company stock in the future at a fixed price equal to or greater than the stock’s fair market value on the grant date. If the stock appreciates, you can buy shares at a price below what they’re then trading for. However, complex tax rules apply to this type of compensation.
Current tax treatment
ISOs must comply with many rules but receive tax-favored treatment:
• You owe no tax when ISOs are granted.
• You owe no regular income tax when you exercise ISOs, but there could be alternative minimum tax (AMT) consequences.
• If you sell the stock after holding the shares at least one year from the exercise date and two years from the grant date, you pay tax on the sale at your long-term capital gains rate. You also may owe the 3.8% net investment income tax (NIIT).
• If you sell the stock before long-term capital gains treatment applies, a “disqualifying disposition” occurs and any gain is taxed as compensation at ordinary-income rates.
So if you were granted ISOs in 2016, there likely isn’t any impact on your 2016 income tax return. But if in 2016 you exercised ISOs or you sold stock you’d acquired via exercising ISOs, then it could affect your 2016 tax liability. And it’s important to properly report the exercise or sale on your return to avoid potential interest and penalties for underpayment of tax.
Future exercises and stock sales
If you receive ISOs in 2017 or already hold ISOs that you haven’t yet exercised, plan carefully when to exercise them. Waiting to exercise ISOs until just before the expiration date (when the stock value may be the highest, assuming the stock is appreciating) may make sense. But exercising ISOs earlier can be advantageous in some situations.
Once you’ve exercised ISOs, the question is whether to immediately sell the shares received or to hold on to them long enough to garner long-term capital gains treatment. The latter strategy often is beneficial from a tax perspective, but there’s also market risk to consider. For example, it may be better to sell the stock in a disqualifying disposition and pay the higher ordinary-income rate if it would avoid AMT on potentially disappearing appreciation.
The timing of the sale of stock acquired via an exercise could also positively or negatively affect your liability for higher ordinary-income tax rates, the top long-term capital gains rate and the NIIT.
Keep in mind that the NIIT is part of the Affordable Care Act (ACA), and lawmakers in Washington are starting to take steps to repeal or replace the ACA. So the NIIT may not be a factor in the future. In addition, tax law changes are expected later this year that might include elimination of the AMT and could reduce ordinary and long-term capital gains rates for some taxpayers. When changes might go into effect and exactly what they’ll be is still uncertain.
If you’ve received ISOs, contact us. We can help you ensure you’re reporting everything properly on your 2016 return and evaluate the risks and crunch the numbers to determine the best strategy for you going forward.
This post has been contributed by our strategic partner Cascade Employers Association. Cascade is an exceptional, membership-based resource for Northwest employers committed to developing a strong, vital workforce. They offer a complete range of services — from hiring well, to training for excellence, to dismissing effectively.
As of January 22, 2017, employers were required to start using a new I-9 form.
While the new form has some great new features (it can function as a smart form), it looks and functions a bit differently than what you may be used to. To help ease any confusion, you’re invited to watch this tutorial on completing the new form. The tutorial takes you step by step through each section and answers the most common questions you may have about the new form.