Take My Advice and Stop Being a Loser
"You've won a new car!" Who wouldn't like to hear those words, be it from Bob Barker or Pat Sajek, or like over 200 lucky audience members, from Oprah Winfrey? Mega-instant winners are raking in the goodies with monster home re-models, complete body makeovers and million dollar prizes. But when the bright lights fade and the TV cameras are gone, the winner can feel like a loser with an enormous tax bill.A recent Wall Street Journal article pointed out the tax consequences these prize-winners face. Even someone in the lowest state and federal tax brackets who won a car on Oprah would owe an extra $6000 in taxes. If they were in the highest bracket, they'd have to shell out an extra $12,000. Even someone below the poverty level would lose $4000 in refundable tax benefits and have to pay over $1000 in taxes!Few of us will ever win the lottery or reality TV show jackpot, but there are hidden tax consequences to the actions used to help our children or avoid probate.
Every day well-meaning parents or grandparents take what seem to be innocent, yet generous actions without the slightest hint at the Pandora's Box they've just created."If I put my son's name on the deed to the house, then he'll get it right away when I die and avoid probate," many reason. In the same way, a child's name is added to CDs, bank accounts, brokerage accounts and the like. This is often done for estate issues. Those doing so don't realize the tax consequences of their actions.In the eyes of Uncle Sam, you just gave your child a gift. And that means you owe your dear Uncle some serious dough.
For instance, put your son's name on your home that's valued at $300,000, and you just gave your son $150,000. That means you could owe Federal and State gift taxes equaling tens of thousands of dollars! The same goes for adding his name to your CDs or your brokerage accounts. There are other tax consequences. When your son sold the house, he could owe capital gains taxes based on your cost basis?potentially losing tens of thousands of dollars more in taxes. Most of the time, these taxes can be avoided through proper planning.There are other consequences to adding a child's name to an asset.
Doing so exposes that asset to the claims of the child's creditors and to possible loss in a divorce! In the above example, if the son is sued or declares bankruptcy, the parents' home could be lost, leaving them out on the street.There are emotional consequences, too. I've talked to many widows who live in fear of their children kicking them out of their own home. When their husband died, it seemed like a good idea to add a child's name to the deed. Now the relationship with the child is strained and the widow's health is deteriorating. With the child's name on the deed, the widow is no longer in control of her own home.You may be saying to yourself, "I did that a few years ago and Uncle Sam hasn't come knocking at my door.
We don't have to worry about that." Tell that to the man I talked to who added a child's name to the deed of his house almost ten years ago. Now the state is coming after him for $13,000 in taxes and penalties. Since many states are facing budget crisis, their pursuit of unpaid taxes has increased. They may not catch you right away, but there's a good chance they will eventually.There are better ways to avoid Probate without all the tax consequences. Gifts can be made in smaller amounts over several years.
You can name beneficiaries on bank or brokerage accounts so that they avoid Probate yet don't expose the asset to a child's creditors. A Living Trust can be used for real estate and Powers of Attorney will provide for the management of your assets should you become incompetent.So don't lose money from hidden tax consequences of adding a child's name to an asset. It's too easy to accomplish the same thing without all the headaches.Questions? Concerns? I'd be happy to provide clear, unbiased advice free of charge.Mr. Voudrie is a Certified Financial Planner and the President of Legacy Planning Group, Inc., a Private Wealth Management firm in Johnson City, TN. For more information call 1-877-827-1463 or email e-mail protected from spam bots .Looking for an energetic expert who is passionate about financial and wealth management?
Mr.
Voudrie is an excellent speaker who will excite and inspire your audience.
Mr. Voudrie is available for a limited number of speaking engagements, television appearances and radio talk shows.
For booking information, contact Christine Lavender at (877) 827-1463 or email e-mail protected from spam bots .Related Articles can be found at www.guardingyourwealth.com under the Guarding Your Wealth Article Archive..
Honeymoon Islands, Inc. Announces Luxury Tropical Island Romantic Giveaways at the 2005 American Music Awards (AMA’s)
Fairfax, VA (ContentDesk) November 16, 2005 -- At the 2005 American Music Awards on November 22nd at the Shrine Auditorium in Los Angeles, some lucky participants will be awarded a luxurious hotel stay package at various resorts throughout the Caribbean courtesy of Honeymoon Islands, Inc. Teresa Belcher, Americas Leading Honeymoon Planner is President of Honeymoon Islands, Inc. who specializes in planning upscale Honeymoons and also plans Destination Weddings.
I am thrilled to have this opportunity to showcase some of the upscale properties in the Caribbean that I represent and to be among the spectrum of luxurious prizes to be given away at the AMAs.
It is a fitting occasion to honor the top elite in their class with a stay at an incredible Caribbean property. The luxury hotel giveaways include the following destinations: Royal Plantation in JamaicaEden Rock
in
St.
BarthsLadera in St. Lucia?????????Four Seasons in NevisParrot Cay in Turks...
Honeymoon Islands, Inc. Announces Luxury Tropical Island Romantic Giveaways at the 2005 American Music Awards (AMA’s)
Financial planning > Honeymoon Islands, Inc. Announces Luxury Tropical Island Romantic Giveaways at the 2005 American Music Awards (AMA’s)
Is Your Mutual Fund The Right One For You?
Mutual Funds are considered to be one of the best investments one can get hands on. They're very flexible and cost-effective. An excellent investment for people with restricted knowledge, time or, money.For beginners, who might have a perplexed expression on their faces at the mention of mutual funds; let me first acquaint them with what the mutual funds are all about.A mutual fund is a financial instrument that enables a group of investors to pool their money together. There's a fund manager who takes care of the pooled money and invests them into specific securities (stocks or bonds). Investing in mutual funds basically means buying shares of the mutual fund and becoming a shareholder.Having read this, you may have now decided to buy a mutual fund.
But you've over 10,000 mutual funds to choose from. So how do you make sure that the one you've picked up is the right one?For those who're new to this investment thing, let me apprise you with load' and no load' mutual funds. ...
Is Your Mutual Fund The Right One For You?
Financial planning > Is Your Mutual Fund The Right One For You?
Boston Bar Foundation renews their gomembers PSA for pinnacle
Herndon, VA ---
(http://www.gomembers.com), announced today that the Boston Bar Foundation (BBF: http://www.bostonbarfoundation.org) has elected to renew its PSA (Preferred Support Agreement) for its gomembers' pinnacle solution. "BBF's renewal of a PSA assures them that their software investment will continue to be protected, while positioning them for future enhancements," states Jay Barrett, Vice President of Operation for gomembers. Mr. Barrett further stated, "Providing customers like BBF with an agreement offering the maximum value and service, along with the technology advances to support their organization is very important to gomembers."For more information on gomembers' solutions, please visit the Products section of our website. www.gomembers.com For any questions, please do not hesitate to contact gomembers via email at: gomembers-inc@gomembers.com gomembers is a leading provider...
Financial planning > Boston Bar Foundation renews their gomembers PSA for pinnacle
Love Your Wedding Preparation at MyBridesmaid.com
London, United Kingdom (ContentDesk) August 14, 2006 -- MyBridesmaid.com has researched thousands of products presenting only the finest, most special items, taking away the stress and helping brides, friends and family, select exciting and unique must have bridal accessories, bridesmaid gifts, honeymoon essentials, wedding jewellery, wedding...
Love Your Wedding Preparation at MyBridesmaid.com
Financial planning > Love Your Wedding Preparation at MyBridesmaid.com
Financial Planners Get More Clients With New Certification
Financial planners are getting new clients from a seemingly unlikely market sector:
U.S. federal government employees.
"Federal employee benefits programs are very complicated. Only the best trained financial planners are able to service this market," says Judy Snow, founder of Federal Employee Benefits Specialist, Inc. (FEBSI) (http://www.FEBSI.com) and developer of the Certified Federal Employee Benefits Specialist (CFEBS) training and certification program.
The CFEBS program equips financial planners, insurance agents, accountants, investment advisors, stock brokers, tax preparers, and other professionals with a thorough understanding of federal employee benefits and associated retirement planning. "Achieving CFEBS certification helps financial planners to learn the ins and outs of these benefits programs and to reach federal employees who are in need of quality financial planning services," Snow explained.
Financial planning > Financial Planners Get More Clients With New Certification
COMPUOFFICE SOFTWARE INC. ANNOUNCES THE BEST VALUE IN WEBSITES FOR INSURANCE PROFESSIONALS AT ONLY $99 PER YEAR.
(ContentDesk) October 3 2003--CompuOffice Software Inc., a North American leader in the field of independent multiple company life insurance comparison and analysis software, is introducing best value website service for individual life insurance advisors, agents and brokers.
This best value service includes full web sites, e-mail facilities, and real-time, on-line life insurance comparisons.
The annual all-inclusive price is set at ONLY $99 per year for individual life insurance advisors, agents and brokers who subscribe to the LifeGuide? Professional Software in Canada or to the CompeteUS? software in the United States.
At the all inclusive price of only $99 per year for the service, individual life insurance advisors, agents and brokers can now easily afford to have their own individual, professional and independent websites for the lowest, and most reasonable rate.While the price, at only $99 per year, is the lowest in the market, the service package is...
Financial planning > COMPUOFFICE SOFTWARE INC. ANNOUNCES THE BEST VALUE IN WEBSITES FOR INSURANCE PROFESSIONALS AT ONLY $99 PER YEAR.