Is $1 Million Too High?

A recent article in the Washington Post indicates that it might be.  The article, Fixing The Most Expensive Tax Deduction, accurately states that taxpayers who pay mortgage interest on their primary residence typically receive significant tax benefits by way of an itemized deduction for mortgage interest paid on principal mortgages up to $1 million dollars.  The deduction for interest paid on principal mortgage indebtedness above the $1 million cap is limited.  According to the linked article, economic indicators appear to reflect that the $1 million cap might be too high.  Do you agree?  Read the article and provide your comments.

Generation Xers and Millennials: Get Your Estate Planning Done!

Those who read the articles on this blog know that estate planning is for everyone!  (If this is your first time reading this blog, read the following article and you’ll understand why:  Estate Planning: Do I Need It? )  James Salter of TheStreet recently posted the following article:  Why Millennials and Generation Xers Need to Worry About Estate Planning .  It is certainly worth reading!

As Salter points out, one of the major misconceptions about estate planning is that it’s for the elderly and wealthy.  This misconception couldn’t be farther from the truth!  Everyone needs some form of estate planning.  The key is to utilize the proper estate planning tools to accomplish your objectives.

Income Tax 101 For Homeowners!

Most individual taxpayers are aware of the annual income tax benefits of owning a home, such as the ability to deduct from gross income any mortgage interest and real estate taxes paid during the taxable year.  There are, however, other income tax rules of which homeowners should be aware, especially those who are disposing of a primary residence — either by sale or gift — or changing the home’s use from a primary residence to investment/rental property.  The article, 7 Tax Tricks For Homeowners , offers a good overview of the income tax implications that most taxpayers overlook in these circumstances.  As always, there’s no substitute for professional advice in these situations.

Clarity Is Key When Re-Registering Assets Into Trust

Recently, an Illinois appellate court decision held that a transfer of real property could be effectuated when the settlor of a trust indicated in the trust instrument that the property was a part of the trust corpus.  See my article, Do You Really Need A Deed?, for a summary of the court’s opinion.

Retirement Planning:  Should You Pay Off Your Mortgage Or Contribute More To Pre-Tax Retirement Funds?

A significant part of estate and tax planning analyzes different retirement financial planning strategies.  As more retirees enter retirement with large amounts of mortgage debt, financial planners are often suggesting that clients reaching retirement age should be paying off mortgage debt vs making larger contributions to pre-tax qualified plans. As in all planning matters, it’s a case-by-case analysis. Nonetheless, the blog post “Pay off the mortgage or add to the 401(k)” offers some interesting points to consider. 

Yet More Reasons To Consider Estate Planning!

Unfortunately, estate planning tends to be placed at the bottom of the “bucket list” for a good portion of the general public.  As many of you are aware, I have written extensively on the need for estate planning.  ALL people need to plan for the future to some degree, not just those who have assets in excess of the federal (and, if applicable, state) estate tax exemption amounts.  I encourage those without any estate planning to read the following article:  No Tax on Your Estate? You Still Need A Plan.  The author of this article highlights several of the struggles that estate planners attempt to address in helping people see the value in the estate planning process.