HAPPY NEW YEARS!
I trust this letter finds you well and that you and your loved ones have had a joyous holiday season!
As we usher in 2017, I would like to take a moment to tell you personally how much I appreciate your business as well as thank you for any referral clients that you’ve sent our way! And to kick off the new year, I would like to give you some valuable tips and advice about your 2017 tax strategy.
First, before I discuss tax laws and the implications they have on your financial life, I would like to talk briefly about the best and most productive policies and procedures we have in place to manage your needs during the short but incredibly busy tax season. As you can imagine, as the senior member of our small team, my availability gets stretched very thin. To maximize productivity, I’ve been diligent with tax law and administrative training with my staff to make sure that you get the answers you need, when you need them. That said, when you call to speak with me directly but can’t reach me, please, trust my staff to handle your needs. If there is an issue that requires my direct attention and/or intervention, my staff will make that happen.
My tax and financial services practice has been a large and rewarding part of my life, but I am contemplating and making plans for retirement in the coming years. That said, to make sure that my firm continues to deliver on best-in-class service to you, I have embarked on a non-wavering continued education program for my staff. Trust that you are and always shall be in the best hands!
Before I discuss tax laws, refunds and the implications they have on your financial life, I would like to talk briefly about the best and most productive policies and procedures we have in place to manage your needs during the short but incredibly busy tax season. As you can imagine, as the senior member of our small team, my availability gets stretched very thin. To maximize productivity, I’ve been diligent with tax law and administrative training with my staff to make sure that you get the answers you need, when you need them. That said, when you call to speak with me directly but can’t reach me, please, trust my staff to handle your needs. If there is an issue that requires my direct attention and/or intervention, my staff will make that happen.
Let’s Talk About Tax Refunds!
Let’s face it… We all want to get our tax refund as quickly as possible but I would like to set realistic expectations. Although the IRS claims that most refunds will be deposited within 25-days from the date the refund was approved, there are things that slow the process down. We deal with this all of the time and have taken every practical step to speed up the process and eliminate potential hassle and headaches. We use the industry’s leading tax processing software that also allows us to collect your tax preparation fee immediately eliminating further payment and accounting hassles.
We all get anxious to see how our refund is coming along. Well, the IRS has a great tool on their website to check that status virtually in real-time. Simply go to www.irs.gov/refunds and follow the simple instructions. If you can’t access the website, you can always call them at 1-800-829-4477. And as a side note, even though we may submit multiple returns to the state and IRS at the same time they don’t always get processed at the same time. Some returns get delayed for a variety of reasons. The most typical being:
- Back child support
- Outstanding student loans
- Back taxes owed
Let’s Talk Tax Laws!
Perhaps the most impactful issues businesses and individuals will face in 2017 are issues dealing with the Affordable Care Act “ACA” (A/K/A Obama Care). Starting in 2016, the Employer Mandate dictated numerous new regulations:
• All companies with at least 50 full time or equivalent employees must offer affordable health coverage to full-timers and their dependents or pay a ne
• The employer’s insurance plan must provide minimum value which means the plan must be designed to pay at least 60% of the cost of covered health benefits and provide substantial coverage of in- patient hospital and physician services.
For 2015, the Employer Mandate applied to firms with 100 or more full time equivalent workers. The fines for non-compliance has risen:
• One ne hits companies that don’t offer coverage to at least 95% of full-time workers in 2016 if even one full-timer opts to buy insurance through a government exchange and receives a receives a subsidy to help pay the premiums
• For 2016, the ne equals the number of full-time employees, less 30, times $2,060
• Firms offering unaffordable insurance pay an even higher penalty. $3,240 for each full-time employee who gets a tax credit for buying coverage on an exchange
For individuals, the ne for going without health coverage has soared in 2016. The tax is typically the greater of two amounts. The basic net or an income-based levy.
• The basic ne is rising to $695 per adult ($347.50 per child) with a family ceiling of $2,085 up from $325 and $975 in 2015
• The income-based levy increased from 2% to 2.5% of the excess of household income over the tax return ling threshold.
The annual cap on deductible contributions HSAs rises as well:
• To $6,750 in 2016 for account owners with family coverage. The ceiling for self-only coverage remains $3,350
• Individuals born prior to 1962 can put an additional $1,000. Minimum policy deductions start at $2,600 for families and $3,300 for singles
• Minimum policy deductible stay at $2,600 for families and $1,300 for singles
• The limits on out-of-pocket costs such as deductibles and co-payments, go up to $13,100 for people with family coverage and $6,550 for individual coverage
Let’s Talk Savings Plans!
Most key Dollar ceilings on retirement plans do not change for 2016. The 401(k) contribution limit remains $18,000 but individuals born before 1967 can put in $6,000 more. These pay in maximums apply to 403(b) and 457 plans. The 2016 pay-in for IRA’s and ROTH IRA’s also stay steady at $5,500 plus $1,000 as an additional catchup contribution age 50 and up.
Deductions phase out for regular IRA’s start at the same levels in 2016:
• From $98,000 to $118,000 of adjusted gross income (AGI) for couples and from $61,000 to $71,000 for singles
• If only one spouse is covered by a plan, the phase out zone for conducting a contribution for the uncovered spouse rises a bit. It will start at $184,000 of AGI and end at $194,000.
Although I originally decided not to probe President-Elect Trump’s agenda for the country at this early date, I decided to venture after reviewing data from the Washington D.C’s Kiplinger Letter and the National Congressional Committee. Social issues will not rank high on his to-do list during his presidency, despite his administrations repeated statements to his “valued voters” during the campaign. Tax reform, immigration, healthcare and other issues will crowd them out. Yet, it does appear that some of President Obama’s mandates are good bets to be reversed.
It appears that an executive order barring discrimination by federal contractors on the basis of gender identity or sexual orientation will be stricken by a Trump order. Reproductive rights will be in the cross-hairs also. Do not be surprised if the Justice Department drops its defense of Federal Court challenges to guaranteed access to birth control under Obama Care. I believe Trump will side with those with religious concerns. Furthermore, look for less aggressive enforcement of workplace discrimination rules by the EEOC by the Republican administration. Under the Obama administration, discriminating against an employee because of sexual orientation or gender identity violates civil rights. That approach may not y with a Republican-lead panel.
2017 Tax Travel Schedule
Appointments Are Important!
When an entire year’s worth of transactions has to be accounted for and reported on in just a few short months, timing is of the essence for all of us. We need to be as productive as possible to manage everyone’s expectations. We work basically by appointment. That said, it is imperative that you make an appointment and keep it. At times, circumstances dictate that you just can’t make it. For everyone’s sake, we ask that you call to cancel and/or reschedule a missed appointment so as not to be billed for it.
New York/New Jersey
Friday, February 3, 2017 – Monday, February 6, 2017 Friday, February 10 – Monday, February 20, 2017 Friday, March 3, 2017 – Monday, March 6, 2017 Friday, March 17 – Monday, March 20, 2017
** Appointments may be extended out to Monday, March 27, 2017**
Friday, February 25th – Sunday, February 26, 2017
Friday, March 10, 2017 – Monday, March 13, 2017
Florida – Jacksonville/Orange Park
Our current office hours are Monday – Thursday from 9:00 a.m. -4:00 p.m. Beginning January 23, 2017 our office hours will be Monday – Friday from 10:00 – 6:00 p.m.
During the tax season Mr. Stubbs will be in the office for all of January. He will be in the Florida of ce February 8th – 9th, February 22nd & 23rd. In March he will be available March 1st – 2nd, March 15th – 16th, March 29th – 30th.
Depending on his New York schedule he may have additional time between March 22nd – 28th. In the month of April he will be available April 5th – 17th.
Let’s Get Ready for 2017!
This is our 38th year of tax preparation and financial counseling. My administrative assistant, Mary Beth Santangelo in Florida and Robyn Gray in New Jersey are eager to get started. Please review all of the information included in this letter as I am certain that it contains valuable and useful information. I have included my schedule to the tax season to assist you in making appointments. Please have all of your documents available when I arrive. You can also add up your expenses by category and provide me with totals.