The IRS will be offering a number of workshops for small to medium sized 501(c)(3) organizations on tax compliance issues. The cost is a bargan - only $45!
The closest one to North Carolina will be in Columbia, South Carolina on December 4,5 and 6. Click here for details.
Beginning in 2008, retirement plans (such as 401(ks) must allow non-spouse beneficiaries to roll over to an IRA. The following is from Ed Slott, CPA:
The Pension Protection Act of 2006 included a provision that would permit non-spouse plan beneficiaries to do direct transfers from the plan to a properly titled inherited IRA and take stretch distributions over their lifetimes instead of being subject to the harsh payout rules of most company plans. This provision became effective in 2007.
The purpose of the provision was to allow non-spouse plan beneficiaries the same ability to stretch post-death distributions over their lifetime as if they inherited from an IRA. That was the plan. But in January 2007, IRS issued Notice 2007-7 which stated that the provision was not mandatory for plans. This created confusion and controversy and took the wind out of sails of this provision. This was contrary to what Congress intended. Congress realized this and has proposed a technical correction to the law stating that the plans MUST allow the non-spouse direct rollover to an inherited IRA.
In light of the pending Congressional technical correction, IRS reversed its position and now says that the non-spouse rollover provision will be mandatory beginning in 2008.
I previously blogged about the changes in the federal Medicaid laws that took place last year. The implementation in North Carolina has been delayed several times, but the rules are expected to be effective November 1, 2007.
In brief, the lookback period for disqualifying gifts will increase from 3 years to 5 years, and the penalty period for gifts within the 5 years will start on the date the Medicaid applicant would otherwise become eligible for Medicaid, instead of the date of the gift.
Effective August 19, 2007, North Carolina repealed the Rule Against Perpetuities, which means that multi-generation dynasty trusts can be created in North Carolina. Previously trusts could not last longer than 90 years or a life in being plus 21 years.
However, some questions have arisen about possible conflicts with other North Carolina laws, which has led to caution on the part of attorneys in recommending dynasty trusts until the questions are addressed. Click "Continue Reading" to view a memo by attorney Liz Arias, Co-Chair of Legislative Committee for the Estate Planning and Fiduciary Law Section of the North Carolina Bar Association.
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Vanguard now requires its customers to have identical benefciary designations for all IRAs of the same type. Click "Continue Reading" for the full article.
This policy could seriously undermine certain estate plans. Unless you don't object to Vanguard telling you how do your benefciary designations, I suggest choosing another custodian.
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Maximum deferral limits for 401(k) and 457 plans remain at $15,500. The limit for defined contribution plan increases to $46,000, while the SIMPLE limit is $10,500. See IRS News Release IR-2007-171 for full details.
The IRS has issued a news release warning small businesses about certain trust arrangements being sold as welfare benefit plans. These arrangements are considered abusive from a tax standpoint in that they provide extra benefits to the business owner or key employees.
Small business owners should not adopt such plans unless the plan has been cleared with their tax adviser.
A parent’s well being is a growing concern for many adult children who watch as a parent ages and perhaps encounters difficulties which are new to the entire family. The issues an aging parent may encounter can seem overwhelming and a child may not know where to turn for assistance. There are many services adult children can utilize as, or before, needs arise.
At the forefront of most people’s minds is ensuring an aging parent’s day-to-day safety. For some, living at home is still an option, while others may require services that only an assisted living facility can provide. Unfortunately, it is often after an accident where a parent’s safety is at issue that families realize a decision must be made. However, there are steps that can be taken before an incident occurs to ensure an aging parent’s safety and comfort.
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