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Various Subjects

IRS Interest Rates Drop

If you are participating in an installment plan with IRS to pay taxes owed with your 2018 tax return, the interest rate for underpayments beginning July 1, 2019 is 5%, down from 6%.

Storm Scams

With hurricane season in full swing, and September being the busiest month of the storm season, be aware of scammers who use weather disaster situations to cheat people. The Federal Trade Commission offers tips to avoid scams by visiting If hiring a contractor to make repairs to your property, always ask for credentials and beware of anyone pressuring you for financial information such as bank account or credit card account information.

Start a ROTH IRA for a Grandchild

If you have a grandchild with a summer job, there is an opportunity to give them an early start on retirement savings by contributing to a Roth IRA for them. A grandparent can contribute money to an IRA for a grandchild who has earned income from a summer job and the contribution can be as much as $6,000.00 or the amount of the child’s 2019 earnings, whichever is less. At a 6% rate of return, just $3,000.00 invested for a 17-year-old can grow to $55,000.00 by the time they are of retirement age (67).

Consider a QCD

A Qualified Charitable Distribution can be made directly from your IRA to the charity of your choice and can save you tax dollars. The QCD counts as your required minimum distribution and the distribution is not taxable or added to your AGI. As much as $100,000.00 can be transferred to a charity through a QCD each year. Here’s a tip – make sure you do a QCD before you take an RMD to avoid taxable income.

I Inherited an IRA. Now What?

If you have inherited an IRA from someone who is not your spouse, you are required to begin taking distributions from that IRA by December 31 of the year after the decedent’s death. These payments are based on your life expectancy. Just as they were for the decedent, distributions from a traditional IRA are taxable while Roth IRA distributions are tax free. Here’s a tip – ask the IRA’s custodian to change the name of the account to include the name of the decedent and date of death in addition to your name.

How Can an HSA Help Me Now and In My Retirement Years?

A Health Savings Account (HSA) is a terrific way to save tax dollars. You place money in your HSA pretax, let it grow tax free, and take it out tax free to pay for qualifying medical expenses. But now financial advisors are looking at HSAs as a savvy investment strategy for retirement. If you qualify to open an HSA (see Publication 969 at for information on who qualifies) you can contribute to the account until you begin Medicare coverage. If you can afford to make the maximum contribution each year ($3,500 for single, $7,000 for a family) and you choose to let the account grow instead of using it for current medical expenses, you can have an additional resource to tap in your retirement years. You can use the HSA to offset medical expenses which are often a retiree’s biggest expense, and you can even use it to pay Medicare premiums. Here’s a tip – name a beneficiary as soon as you set up an HSA to prevent the account from having to go through your estate upon your death.

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