Social Security

Before You File Your 2016 Taxes, Review These Tax Breaks for the Disabled

Published on: March 13, 2017 | By McCulloch & Miller, PLLC

There is some kindness in the tax code, especially when it comes to the disabled and their care givers. There are a few tax breaks that are intended to alleviate some of the financial burden.

Even when a disabled person is able to work, they or their caregivers must incur many additional costs, from transportation needs to medicines and special supplies for care. A study by the Centers for Disease Control and Prevention reported that one out of every five Americans lives with a disability. If this includes you or someone you care for, you’ll want to know about some tax tips that are designed to help. A recent article in Yahoo Finance, “8 Tax Tips for People With Disabilities (and Their Caregivers),” offers some useful details.

ABLE accounts. These accounts are newer savings vehicles for those who become blind or disabled before the age of 26. The accounts are like 529 college savings accounts—the account grows tax-free and can be spent on eligible expenses with no taxes. Contributions to these accounts don’t qualify for a federal tax credit or deduction. However, Iowa, Michigan, and Nebraska offer state tax benefits for contributing.

Social Security’s Less Known Customer Services

Published on: September 21, 2016 | By McCulloch & Miller, PLLC

Certain organizations are known for providing amazing customer service. Social Security is not usually one of them. However, there are some services that Social Security does offer that are not well known and that could make life easier for many.

Good news is hard to find when it comes to dealing with large government bureaucracies, including Social Security. That makes this information provided by AARP’s article, “Discover Little-Known Social Security Benefits,” especially welcome.

Some years ago, Social Security officials saw that the long waiting time for decisions on disability applications was resulting in severe hardship for the seriously ill. As a consequence, the agency established the Compassionate Allowances List.

What You Don’t Know About Estate Planning Could Hurt Your Family

Published on: August 29, 2016 | By McCulloch & Miller, PLLC

Think of an estate plan as a love letter to your family after you have passed.

You’d be surprised at how many people you know don’t have a will or an estate plan in place. They may be among the many who have an unspoken belief that if they don’t have a will, they won’t die. That would be terrific—if it were true. Or, they think that only people who are wealthy or have complex tax issues require estate planning.

The Sabetha (KS) Herald’s recent article, “Understanding the estate planning process,” says that both of these ideas are wrong because your level of wealth and the ultimate tax consequences of your estate take a back seat to the planning and care of your family and other heirs.

New Rules You Need to Know About Social Security

Published on: June 6, 2016 | By McCulloch & Miller, PLLC

Rules on claiming benefits were never simple and recent changes have eliminated "file and suspend" techniques. Here's what you need to know about Social Security benefits right now.

Social security was originally designed to serve the elderly and destitute, but today, working Americans depend on Social Security benefits to fund part—and often all—of their retirement expenses. Kiplinger's "10 Things You Must Know About Social Security" explains the new rules about Social Security.

Here are some of the essentials you need to know.

Retirees Are Changing Things Up-Could Houston be a Hot Destination?

Published on: June 2, 2016 | By McCulloch & Miller, PLLC

The entire US is up for grabs for retirees who are moving to a wide variety of location—from the mountains of Montana to the moderate temperatures of South Carolina. Is Houston a hot spot?

Once upon a time, if you lived in the north, your default retirement destination was either Arizona or Florida. Today, retirees are looking for low taxes, nice weather and an active lifestyle. They are finding it in many different locations.

The New York Daily News explains this and more in its article, "Forget Florida and Arizona — today's retirees are branching out all over the U.S." Women continue to live longer than men, but the difference has narrowed as the lifespan of males has grown consistently within recent decades. This means that the chances are better now that a married woman will spend additional time in retirement together with her partner than as a widow. Retirees are taking advantage of this additional time together by heading to new territories.

Make That Retirement Nest Egg Stretch As Far as Possible

Published on: May 2, 2016 | By McCulloch & Miller, PLLC

Long gone are the days of pensions, when employers took care of all Houston retirement income. On the flip side, Houstonians are living longer and healthier lives.

If X equals a longer lifetime and Y equals smaller retirement funds, how do you solve for Z? Making retirement money last longer to match a longer lifespan is a very real problem for Houstonians. These three suggestions from The Motley Fool's "3 Easy Moves to Make Your Money Last Your Lifetime" cover some of the big-picture topics: expenses, investment tools and earned income.

Decreasing expenses and cutting unnecessary costs is the first step in making your nest egg last longer. More than likely, your biggest cost is housing. This is where paying off your mortgage long before retirement—or downsizing into a smaller home either before retirement or just as you retire—makes sense. Unfortunately, more and more Houston seniors are still carrying mortgages during retirement. Consider throwing all unexpected windfalls against the mortgage, or make one extra payment every year—if cash flow allows.

Know Social Security Options to Avoid Expensive Mistakes

Published on: December 18, 2015 | By McCulloch & Miller, PLLC

An interactive online tool has been released by the U.S. Consumer Financial Protection Bureau (CFPB) that walks consumers through a series of questions to help them better understand the optimal time to file for Social Security benefits. The "Planning for Retirement" site is an attempt to address a serious problem facing older Americans who claim their benefits too early in life, which results in their receiving lower monthly benefits. The goal of "Planning for Retirement" is to show the user how to make a better decision.

In many instances, the claiming-age decision is based on limited information about the financial impact of that choice. The new CFPB tool lets people estimate how much money they can expect to receive at different ages and provides tips to help evaluate the trade-offs. The "Planning for Retirement" tool is at: http://www.consumerfinance.gov/retirement/.

Folks can claim their benefits several years before their "full retirement age" and take less money each month. Or they can wait and get bigger monthly checks. This is typically a one-time choice, so if you claim the reduced or increased benefit, that's what you get for the rest of your life, with annual cost-of-living adjustments. In addition, this decision affects the benefits your spouse will receive after your death.

Future Trends? Some Savvy Retirement Loopholes May Be Changed

Published on: August 19, 2015 | By McCulloch & Miller, PLLC

Savvy individuals, estate planning lawyers and financial advisors are not averse to finding unintended benefits when Congress makes changes to laws regarding retirement accounts and Social Security payments. Unfortunately, when too many of these techniques are discovered and shared widely, the government sees revenue slipping away. Three of these loopholes have drawn the attention of various government agencies and may be changed in the near future.

A recent Reuters article, titled “3 Retirement Loopholes That Are Likely to Close,” discusses some of the loopholes that can be found, as an unintended result, due to changes in law.

Back-Door Roth IRA Conversions. Congress created this loophole by lifting income restrictions from conversions from a traditional IRA to a Roth IRA, but not placing such restrictions from the contributions to the accounts. As a result, those whose incomes are too high to put after-tax money directly into a Roth IRA so it can grow tax-free, instead are able to fund a traditional IRA with a non-deductible contribution then convert it to a Roth. Taxes are usually expected in a Roth conversion, but this work-around doesn’t cause much liability, the article explains, provided the contributor doesn’t have other money in an IRA.

Finding Financial Resources for Your Houston Parents

Published on: January 15, 2015 | By McCulloch & Miller, PLLC

We asked experts to let us in on a few resources most people overlook.

Need more cash to help care for mom and dad? A recent Oprah Magazine article, titled “Sanity-Saving Secrets For Caring For Your Aging Parents,” has some ideas where to look for funds to support your parents in retirement.

Here are some of those ideas from the original article:

Enjoy Some Diet COLA With Your Social Security

Published on: November 23, 2013 | By McCulloch & Miller, PLLC

The nation's elderly and disabled Social Security recipients will receive a 1.5 percent increase in payments in 2014. The same COLA will apply to pensions for federal government retirees and most veterans.

According to recent news from the Social Security Administration, the Cost Of Living Adjustment (COLA) made to Social Security payments will increase 1.5% in 2014. Although it is a small increase, you will be able to enjoy some "diet COLA" with your Social Security next year.

ElderLawAnswers weighed in on the news in an article titled “Social Security Benefits to Rise Only 1.5 Percent in 2014,” while the SSA has issued its own COLA Fact Sheet.