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WHAT THE NEW TAX BILL MEANS FOR YOU

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Congress passed the Tax Cuts and Jobs Act in December of 2017 which is aimed at cutting taxes for corporations and all Americans. While the bulk of the legislation went into effect January 2018, most taxpayers will not see much of a difference in their taxes until 2019, when they file their 2018 taxes. However, there are several important changes seniors need to be aware of now that could affect not only their tax bill, but other items such as their health care premiums. Legislation as complicated as a new tax code can be difficult to dissect, and certainly requires the help of a tax professional. Please feel free to contact our office with any questions you may have while reading through the points below:

Before explaining the changes, let’s examine several facets important to seniors that will remain the same. The new tax bill keeps the extra standard deduction for those 65 and older, which is $1,250 for individuals, $1,550 for heads of households, and $2,500 for couples who are both age 65 or older. Also, the new plan keeps the popular medical expense deduction. This deduction is for people with incomes below $75,000 which allows them to deduct medical expenses that exceed 7.5 percent of their income for the 2017 and 2018 tax year. In 2019, this will increase to bills that exceed 10 percent of their income. Further, the new plan does not affect the way Social Security or investment income is taxed.

Perhaps the most talked about change in the new tax plan is the repeal of the individual mandate contained in the Affordable Care Act. According to the bipartisan Congressional Budget Office (CBO), by 2027, this will increase the number of Americans without health insurance by 13 million. The CBO also states that because there will be a smaller pool of insured, it expects insurance premiums in the individual market to increase by 10 percent over the next 10 years. Citizens age 50 to 64 can expect a premium increase of up to $1,500 in 2019.

Image result for 2018 tax lawThe tax bill slashes taxes across the board, contributing to a loss of $1.5 trillion in revenue to the government over the next decade. This deficit would trigger cuts to “pay-as-you-go” programs such as Medicare and Medicaid. Medicare is expected to have its budget slashed by $25 billion in 2018.

Other notable provisions that will affect senior taxpayers include the new tax brackets which range from 10 percent for the lowest earners to 37 percent for those with the highest incomes. Taxpayers can deduct state and local taxes, which may include income, sales, and property taxes. The state and local tax deductions are capped at $10,000. Alimony payments will no longer be deductible. Anyone who inherits an estate can now exempt $10 million compared to the previous $5.6 million. The charitable giving deduction will increase under the new plan until this provision expires in 2026. The mortgage interest deduction is also being updated. Now, the deduction on mortgage interest is capped to loans of $750,000 for new home purchases and interest accrued on home equity loans is no longer deductible.

Under the new Tax Cuts and Jobs Act, the majority of seniors may see their tax bills decrease. However, it is still prudent that seniors be aware of the changes that may affect them such as their health care premiums or deductions on medical expenses. If you would like to meet with a professional who will be able to assess your personal situation and provide you with guidance on how this will affect you, please don’t hesitate to give our office a call.

Greg McIntyre

greg@mcelderlaw.com

Elder Law Attorney
McIntyre Elder Law
123 W. Marion Street

Shelby, NC 28150

704–259–7040

New 2018 Tax Law (Video)

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New 2018 Tax Law: What are the changes in the new tax law this year? How do they and your family? Accountant Robby Reynolds is here with us today to discuss some of the changes.
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Full Speech: So honored to speak at the Shelby Rotary Lunch Club today!

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So honored to speak at the Shelby Rotary Lunch Club today! Great food and such a distinguished group. Many thanks!

Happy Valentine’s Day from our family and our firm to you and yours!

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Happy Valentine’s Day from our family and our firm to you and yours! On Caleb Raines day it is important to remember our loved ones.

***FOR IMMEDIATE RELEASE *** JTWROS now applies to automobiles in NC.

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***FOR IMMEDIATE RELEASE *** JTWROS now applies to automobiles in NC. Automobiles can now be owned as Joint Titleholders with Rights of Survivorship. Great for planning. Watch this video!

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Proud to showcase veteran, Roland Stewart, as he discusses a medical career in the military…

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Proud to showcase veteran, Roland Stewart, as he discusses a medical career in the military serving around the globe.
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Elder Law Report | 2018 State of the Firm Address

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Elder Law Report | 2018 State of the Firm Address: from the flood to the new office we have had an amazing year. In this episode we recap the year and talk about upcoming services we will be implementing in 2018… Loved doing this “themed” episode.
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Aging is a Success Story

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Aging is the sign of a successful life. After all, when you think about the alternative to aging your perspective about getting older shifts. You should start seeking self-sufficiency for your retirement years well before the age of sixty-five. But, even if you have not done so, don’t shun the planning stages. You need to address planning no matter what your age. Some preparation is better than none at all. It can provide you with some peace of mind and can take pressure off of family members who would have to make their own income adjustments to be able to provide money to support your cost of living. No one wants to become a burden to their children or otherwise extended family. It feels good to be able to provide for oneself (and one’s spouse) no matter how lavishly or modestly. It is a relief to know that you have solid plans as well as contingency plans for the future. Although it can be hard work and tough to realize how much it will take to cover your future living expenses, putting off the planning stage does not lead to easier or better outcomes.

First of all, consider your location. Many seniors prefer the idea of living out their lives in their own home but there is much to consider about that approach. Are you close to family members or someone willing to help drive you to doctor appointments and grocery stores when you are no longer able? Can your home accommodate a wheel chair; is there a bedroom on the first floor or is there a way to get up and down the stairs? How expensive are the property taxes in your area? How mild is the weather? If you want to go to a retirement community, what locations are most affordable as well as most desirable? How would you transition to less independent living over time?

Once you know your location goals, do some worst-case planning. Adverse health and unforeseen life events can ravage your finances unless you are already managing a sizeable sum of assets or have incorporated proper planning. You might look for advice as to how to turn a nest egg into retirement income, or how to add to your long-term insurance care, or to establish some long-term insurance care. Think particularly about in-home care should your goal be to stay in your own home as you age.

You need to know if your state has approved the Long-Term Care Partnership Program, a joint federal-state policy initiative to encourage the purchase of private long-term care insurance. A professional can explain to you how it can protect some of your assets if you would require extensive care in the future, for instance for Alzheimer’s disease, which could potentially exhaust your private insurance policy benefits and require you to apply for Medicaid. A professional can also advise you if there are any federal or state tax incentives available to you for long-term care partnership insurance. You can also discuss implementing some additional life insurance that can remain in force until you are eighty. It can help a spouse with extra money should something happen to you. In the meantime, both of you could sleep better at night knowing the insurance policy is in place. The point is, you need to examine some potential worst case expenditure scenarios and how you would be able to meet the needs of your care should the moment arise.

Your aging is a success story. Embrace how you prepare for your senior years no matter what your age is, and the sooner the better! Retirement requires careful thought, planning and decision making for the best outcome possible for you and your loved ones.

Contact our office today and schedule an appointment to discuss how we can help you with your planning.

Interviews with Veterans: The Schenk Brothers

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Interviews with Veterans: The Schenk Brothers: I had the opportunity recently to sit down with 6 brothers, all veterans… 3 of which were actually in Vietnam at the same time. I really enjoyed the hospitality and conversation…
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Elder Law Report: DON’T GAMBLE WITH YOUR FUTURE. VEGAS EDITION.

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Elder Law Report: DON’T GAMBLE WITH YOUR FUTURE. VEGAS EDITION. Viva Las Hayden this week as Ms. Hayden goes to Sin City with her husband and joins us for this episode. Looks like she is having lots of fun!
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