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BEST

January

2019

 

Advisor News Insight

 
Happy New Year
 

Thank you for your business in 2018. It has been a pleasure helping you reach your goals, and we look forward to working with you again in the new year. We at BEST wish all of you and your families a prosperous and wonderful 2019!

 
 

AFRs |  FACTS |  TOOLS |  REQUIREMENTS |  CFP ETHICS WEBINAR | 

1-HOUR WEBINAR |  PODCAST |  FEATURED |  SUPER CE

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Industry News

 

A Message from Edward J. Barrett
BEST’s Founder, President and CEO

 

Thank you!

 

Thank you for your support and readership through another year. This year (2019) will mark the 8th year that BEST has provided this monthly newsletter. It has been our intention to provide you with a quick reference to articles, white papers, books, and websites to increase your knowledge and to be able to provide the best services to your clients.

 

We look forward to continue our mission in 2019, and would greatly appreciate your feedback or comments on how we can make this newsletter BEST for you. (Please email all feedback/comments regarding our newsletter to: marketing@best-ce.com)

 

Once again we thank you for your support and we wish you the BEST in 2019.

 

Ed Barrett

 
 

Charitable Planning

 

The 2018 DAF Report

 

DONOR-ADVISED FUNDS (DAF) are one type of charitable giving vehicle that enables donors to reach their philanthropic goals. The rapidly increasing number of individual donor-advised fund accounts make them the fastest-growing vehicle in philanthropy; and the rising value of charitable dollars granted from donor-advised funds also makes them the most active type of charitable giving vehicle. National Philanthropic Trust provides this report as a public service to those who are interested in this important charitable giving vehicle.

 

This report was published by National Philanthropic Trust.

 
 
 

Charitable Deductions: Ranking the States

 

“In tax year 2016, just over 37 million taxpayers took an itemized deduction for their charitable giving, deducting a total of $236 billion in charitable contributions for an average of $6,349.” See how your state ranks.

 

This article was written by Erica York, Analyst with the Center for Federal Tax Policy at the
Tax Foundation
.

 
 
 

Notice of Proposed Rulemaking Substantiation and Reporting Requirements for Cash and Noncash Charitable Contribution Deductions

 

The Internal Revenue Service (IRS) recently issued final regulations (the proposed regulations were issued 10 years ago) that make changes in the substantiation and reporting rules governing cash and noncash gifts made by individuals, partnerships and corporations. The IRS also changed appraisal rules for charitable gifts. Failure to abide by the rules can result in the complete denial of your client’s charitable deduction.

 

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Educational Planning

 

IRS Notice 2018–58: Guidance on Recontributions, Rollovers and Qualified Higher Education Expenses under Section 529

 

IRS has released Notice 2018-58 that the Department of the Treasury (the Treasury Department) and the Internal Revenue Service (the IRS) intend to issue regulations providing clarification regarding (1) the special rules for contributions of refunded qualified higher education expenses to a qualified tuition program under § 529(c)(3)(D) of the Internal Revenue Code (Code); (2) the new rules under § 529(c)(3)(C)(i)(III) permitting a rollover from a qualified tuition program to an ABLE account under § 529A; and (3) the new rules under § 529(c)(7) treating certain elementary or secondary school expenses as qualified higher education expenses.

 
 
 

Record $1.465T owed on US student loans

 

Money owed under US student loans is twice the amount at the end of the Great Recession in June 2009, according to an analysis of securitization data. The total hit a record $1.465 trillion in November, and loans originated in 2012 are defaulting at a higher rate than loans in other periods since the financial crisis.

 

This article was written by Alexandre Tanzi, Managing Editor of Bloomberg L.P.

 
 

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Estate Planning

 

More Than Half of American Adults Don't Have a Will, 2017 Survey Shows

 

According to a new Caring.com survey, only 42 percent of U.S. adults currently have estate planning documents such as a will or living trust. For those with children under the age of 18, the figure is even lower, with just 36 percent having an end-of-life plan in place.

 

This article was written by Nick DiUlio, of Writer Caring.com.

 
 
 

Should Large Estates Shelter the State or the Federal Exclusion Amount Where the Federal QTIP Election Is Binding for State Estate Taxes

 

“Now that portability has been made permanent, married clients with large estates in states such as New York that have a state estate tax with a lower exclusion amount than the Federal, and where the Federal QTIP election is binding for state estate tax purposes, should consider whether to shelter the Federal exclusion amount or only the state exclusion amount.”

 

This article was written by Bruce D. Steiner, of the New York City law firm of Kleinberg, Kaplan, Wolff & Cohen, P.C.

 
 
 

The Ten Most Popular States for Trusts

 

These states fall into two broad categories.

 

Control, privacy and favorable tax treatment (when used properly) are but a few of the advantages offered by trusts.

 

This article was provided by the Staff of WealthManagement.com.

 
 

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IRA Planning

 

IRA trusts need an advisor checkup

 

Now that big financial institutions are advertising zero-fee services, financial advisors need to justify their charges more than ever. One of the best ways to do this is to offer advice and guidance that simply isn’t available elsewhere. One of the biggest opportunities — for generating new fees and new business — is in the area of IRA trusts.

 

This article was written by Ed Slott, nationally recognized professional speaker, personal finance columnist, accomplished author and President of Ed Slott and Company, LLC.

 
 
 

Maximize Roth retirement savings through “back door” contributions

 

Retiring clients who cannot sock away more money to a Roth IRA because of the contribution limit — but still want to ramp up their account balance — could use the “back-door Roth IRA” strategy, according to an article on CBS Moneywatch. To do this, they should participate in a 401(k) plan, make after tax contributions and move the money to a Roth IRA through an in-service withdrawal. They should make the transfer as soon as they make contributions in order to avoid the funds accruing taxable earnings.

 

This article was written by Ray Martin, Columnist on CBS Moneywatch.

 
 

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Life Insurance Planning

 

Split Dollar Life Insurance

  • Split-dollar life insurance policies may become popular again. Organizations have long used split dollar policies as part of the compensation packages for many of their highest-paid individuals. Although this is not a new idea, the addition of Section 4960 may bring split-dollar policies to the mainstream due to the perceived flexibility such policies provide. The theory is that an organization would buy a split-dollar policy and have the policy allow loans against the life insurance. The policy would loan monies to the covered employee, and the loan proceeds would not be included for purposes of determining the $1-million threshold under Section 4960.
  • Under the Tax Cuts Jobs Act of 2017, beginning in 2019, IRC Section 4960 imposes an excise tax on compensation of certain highly compensated employees (HCEs) of tax-exempt organizations.

 

This article was written by Robert S. Ellerbrock, III, Counsel of Ogletree, Deakins, Nash,
Smoak & Stewart, P.C.

 
 

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Medicare & Medicaid Planning

 

How Much Do You Know About Medicare?

 

Medicare will cover an increasingly large number of people as the population ages, and the program remains an important topic in Washington and around the country as political leaders and other policy makers weigh potential changes to the program. Take this quiz to find out how much you know about Medicare, the people it serves, the benefits it covers, and its financial status.

 

This quiz is provided by the Kaiser Family Foundation.

 
 
 

Medicare Beneficiaries’ Out-of-Pocket Health Care Spending as a Share of Income Now and Projections for the Future

 

The Kaiser Family Foundation (KFF) just released a report entitled “Medicare Beneficiaries’ Out-of-Pocket Health Care Spending as a Share of Income Now and Projections for the Future” (January 2018). As noted in the report, “with half of all Medicare beneficiaries living on annual per capita income of less than $26,200, out-of-pocket health care costs can pose a challenge, particularly for beneficiaries with modest incomes and those with significant medical needs.”

 

This article was written by Juliette Cubanski, Ph.D., MPP, MPH, is Associate Director of the Program on Medicare Policy at Kaiser Family Foundation in Menlo Park, Calif,  Tricia Neuman, Senior Vice President of the Henry J. Kaiser Family Foundation and Director of the Foundation’s Program on Medicare Policy, Anthony Damico, Statistical Analyst at the Henry J. Kaiser Family Foundation, and Karen Smith, writer at the Kaiser Family Foundation.

 
 

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Retirement Planning

 

New retiree research from IRI

 

An IRI original research report, "Retirement, Income and Risk," found that only about one in six retirees relies on Social Security for more than half of retirement income, and two-thirds rely on an employer pension for at least 25% of their income. Future retirees will be much more dependent on retirement savings for income and must plan accordingly.

 

This report was published by the Insured Retirement Institute (IRI).

 
 
 

When Couples Retire Together--or Don’t

 

About 43% of married couples did not agree on the age they intend to retire, according to a recent survey in this Morningstar article. While some experts see this as a problem, others think staggered retirement dates present a great opportunity. “For many people, it’s a good idea to talk about retirement in two phases. It might be that you’ll be operating a little more independently of one another in the first phase, and more together later on,” says an expert.

 

This article was written by Mark Miller, Retirement Columnist for several publications including but not limited to the Morningstar.

 
 

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Social Security Planning

 

Calculating Social Security survivor amounts

 

What happens to the survivor if a worker dies before claiming benefits?

 

A financial adviser wrote to me recently regarding a client who wants to wait until age 70 to claim his Social Security retirement benefit to ensure that his surviving spouse would get the largest possible survivor benefit.

 

This article was written by Mary Beth Franklin, Contributing Editor of InvestmentNews.

 
 
 

Monitoring Your Earnings Can Really Pay Off

 

You work hard for your money. You’re saving and planning for a secure retirement. Now you need to make sure you’re going to get all the money you deserve. Regularly reviewing your Social Security earnings record can really pay off, especially when every dollar counts in retirement.

 

This article was written by Jim Borland, Acting Deputy Commissioner for Communications at the Social Security Administration.

 
 
 

Social Security underpaid 82% of dually entitled widows and widowers

 

Based on a random sample, the inspector general found that 82% of current beneficiaries who are dually entitled to survivor benefits and their own retirement benefits would have received a higher monthly benefit amount if SSA had informed them of the option to delay their retirement application until age 70.

 

This article was written by Mary Beth Franklin, Contributing Editor of InvestmentNews.

 
 
 

Underpayments Payable to Widow(er)s Eligible for a Higher Monthly Benefit Amount

 

In the report, Underpayments Payable to Widow(er)s Eligible for a Higher Monthly Benefit Amount, SSA estimated that they underpaid $224 million to about 25,000 widows and widowers.

 

This report was provided by the Office of the Inspector General, Social Security Administration.

 
 

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Tax Planning

 

Federal Tax Regulations in 2018

 

Below lists tax regulations issued by the U.S. Department of Treasury and IRS in 2018. The links will take you to the text of the regulations (usually in the Federal Register) and other helpful information:

 
  • For more information on the regulations including comments submitted on proposed regulations, visit regulations.gov.
  • Federal Register - click here.
  • IRS Items from the Federal Register - click here.
  • IRS archival content - click here.
  • IRS Electronic Reading Room (FOIA) - click here.
  • Overview to IRS Guidance - click here.
  • Office of Information and Regulatory Affairs (OIRA) in OMB - click here.
    • Check status of regulations - click here.
    • Treasury regulations under review and whether “economically significant” - click here.
  • IRS website on Affordable Care Act provisions and links to regulations and other guidance - click here.
  • List of regulations issued from 2011-2018 - click here.
 
 
 

IRS Releases Standard Mileage Rates for 2019

 

The Internal Revenue Service (IRS) has issued the 2019 standard mileage rates. Beginning on January 1, 2019, the standard mileage rates for the use of a car, van, pickup or panel truck for business purposes will be 58 cents.

 
 

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Practice Management

 

FINRA Exam Report: 5 Big Problem Areas for Brokers in 2018

 

The Financial Industry Regulatory Authority released its annual exam findings on Friday, zooming in on improper activity that it wants to stop. The report lists the areas in which industry players need to do better, based on what FINRA staff has been seeing out in the advisory field: advisors working on accounts and transactions for which they do not have authorization or the authorization had expired, as well as cases of mismarked order tickets, false statements, blank forms and the abuse of trustee status.

 

The article and report were prepared/published by FINRA.

 
 
 

The Secret to COI Referrals

 

There are two critical components for effective COI relationships—personal connection AND structure. We often talk about getting personal with your CPA and attorney partners. In our opinion, it’s the most overlooked component of the relationship.

 

This article was written by Stephen Boswell, President of The Oechsli Institute and Kevin A. Nichols, Director of Coaching for The Oechsli Institute.

 
 

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Assumed Federal Rates (AFRs)

 

§7520 Rate for January is: 3.4%

 

AFRs Breakdown:

 
AFRs
 

View a complete history of AFR §7520 rates, as well as information on NumberCruncher Software for Estate, Financial and Charitable Planning at:

 
 

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Financial Facts of the Month

 

College Savings Plans

 

The average 529 Plan balance hit a record $24,153 as of June 30, 2018, according to the College Savings Plans Network. While a record amount, it would barely cover the cost of one semester at some of the nation’s more expensive colleges and universities. (Source: College Savings Plans Network).

 
 
 

Does Not Cover Everything

 

Medicare beneficiaries are still responsible for an average of $5,503 per year of “out-of-pocket” health care spending. That total is projected to increase to $7,877 per year by the year 2030 (Source: Kaiser Family Foundation).

 
 
 

My House, My Piggy Bank

 

“Cash-out refis,” i.e. a homeowner taking out a new mortgage that is larger than his/her previous mortgage and pocketing the difference, peaked in 2006 when American homeowners pulled out $320 billion of home equity during a rising housing market. Homeowners pulled out just $15 billion of their home equity through “cash-out refis” in the 3rd quarter 2018 (Source: Freddie Mac).

 
 
 

Producing More, Importing Less

 

As of the end of October 2016, the USA was producing 8.5 million barrels of crude oil per day, while we were importing 9.0 million barrels. As of the October 2018, the USA was producing 11.2 million barrels of crude oil per day while we were importing 7.3 million barrels. Thus, in the last 2 years, our nation’s production has increased +2.7 million barrels per day, while our importing of crude oil has declined by 1.7 million barrels per day – a net difference of 4.4 million barrels (Source: U.S. Department of Energy).

 
 

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Advisor Tools

 

2019 Tax Guide

 

2019 Reference Guide to Social Security & Medicare

     
Our Tax Guide contains tax information such as:   Our Reference Guide contains information such as:
     
  • Individual income tax rates

  • Estates and trusts tax rates

  • Roth IRA contribution limits and much more

 
  • Social Security income limits

  • Medicare Parts A-D deductibles and premiums

  • Medicare surtaxes and much more

     
Download the Tax Guide below:   Download the Reference Guide below:
     
 
     

Please note that we do not provide printed copies. Feel free to make as many of your own copies as you need.

 
 

Financial / Insurance
Calculators & Websites

 

An extensive list of online calculators and informational websites.

 
 

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Requirement Updates

 

Several states have updated their insurance CE requirements. (View updates, CE requirements and more by clicking on the link below.)

 
 

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CFP Ethics Webinar

 

“Ethics CE: CFP Board’s Revised Code and Standards”

 

PRESENTED BY: EDWARD J. BARRETT

CFP®, ChFC®, CLU®, CEBS®, RPA, CRPS®, CRPC®


DATE: MONDAY, JANUARY 28, 2019


TIME: 2:00PM - 4:00PM ET


CREDIT: 2-HOURS OF CFP ETHICS CE*

(NOTE: This webinar does NOT include state insurance credit.)

 

During this live webinar, Ed will present the CFP Board’s Ethics CE program to help bring CFP® professionals up-to-date on the new Code and Standards. The following learning objectives will be covered during the webinar:

  • Identify the structure and content of the revised Code and Standards, including significant changes and how the changes affect CFP® professionals.
  • Act in accordance with CFP Board’s fiduciary duty.
  • Apply the Practice Standards when providing Financial Planning.
  • Recognize situations when specific information must be provided to a Client.
  • Recognize and avoid, or fully disclose and manage, Material Conflicts of Interest.

 

NOTE: If your company’s site blocks access to GoToWebinar, please use a non-work related device, such as a personal computer, laptop, tablet, iPad or Smartphone. Also, do NOT use your company’s internet or Wi-Fi to connect.

 

*CE CREDIT INFORMATION:


LIVE WEBINAR ONLY: This webinar has been approved to meet the mandatory two (2) credit hour CE CFP Ethics requirement. If advisors provide their advanced designation information at registration, BEST will report the completed credit on their behalf within five (5) business days of the live webinar. Please be aware that you must view the event for a minimum of 120 minutes (2 hours) and complete the Evaluation Form to receive credit and a Certificate of Completion. Also, advisors must be logged into and viewing the video/presentation, NOT just listening to the audio.)

For more information regarding the webinar registration process, please contact marketing@best-ce.com. If you have any questions regarding CE credit, contact our Accreditation Department at processing@brokered.net.


We are currently updating our system and information regarding registration will be sent via email once it becomes available. Thank you for your patience.

 

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Live Webinar:

 

“Washington Update”

 

PRESENTED BY: EDWARD J. BARRETT

CFP®, ChFC®, CLU®, CEBS®, RPA, CRPS®, CRPC®


DATE: TUESDAY, JANUARY 29, 2019


TIME: 3:45PM - 4:45PM ET


CREDIT: 1-HOUR OF CE CREDIT FOR CFP®, CIMA® AND CPWA® PROFESSIONALS* (NOTE: THIS WEBINAR DOES NOT INCLUDE STATE INSURANCE CREDIT.)


FEE: INCLUDED WITH MEMBERSHIP ($299.00 ANNUALLY) OR $24.95 EACH INDIVIDUAL WEBINAR (USD)


During this live webinar, Ed will provide financial and insurance professionals with a clear understanding of certain provisions of the Tax Cuts and Jobs Act (TCJA) of 2017 that will affect individuals and businesses large and small and will allow advisors to:

  • Relate to the background of the Tax Cuts and Jobs Act (TCJA) of 2017
  • Identify certain provisions of the TCJA that affects the individual
  • Identify certain provisions of TCJA that affects pass-through businesses
  • Identify provisions of the TCJA that affects corporations
  • Describe how the new Act will affect life settlements

 

NOTE: If your company’s site blocks access to GoToWebinar, please use a non-work related device, such as a personal computer, laptop, tablet, iPad or Smartphone. Also, do NOT use your company’s internet or Wi-Fi to connect.

 

*CE CREDIT INFORMATION:


LIVE WEBINAR ONLY: This webinar has been approved for one (1) CE credit hour for CFP®/CIMA®/CPWA®. If you provided your advanced designation information at registration, BEST will report the completed credit on your behalf within five (5) business days of this live webinar. Please be aware that you must view the event for a minimum of 50 minutes in order to be granted credit. (Credit is for the advanced designations listed above only. It does NOT include state insurance credit. Also advisors must be logged into and viewing the video/presentation NOT just listening to the audio.) For more information regarding the webinar registration process, please contact marketing@best-ce.com. If you have any questions regarding CE credit, contact our Accreditation Department at processing@brokered.net.


We are currently updating our system and information regarding registration will be sent via email once it becomes available. Thank you for your patience.

 

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BEST’s Advisor Insight
Audio Podcast

 

HOSTED BY: EDWARD J. BARRETT

CFP®, ChFC®, CLU®, CEBS®, RPA, CRPS®, CRPC®


Below is a list of available Advisor Insight Audio Podcast episodes:


2019

  • Episode 1: 2019 IRS Tax Information

2018

  • Episode 1: Roth IRA Recharacterizations After the Tax Cuts and
    Jobs Act of 2017
     
  • Episode 2: Financial Exploitation of Seniors
     

NOTE: OUR PODCAST EPISODES ARE NOT APPROVED FOR CE CREDIT!


We are currently updating our system and access information to our podcast episodes will be sent via email once it becomes available. Thank you for your patience.

 

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Featured Self-Study CE Course

 

“BEST CE Courses Updated for 2019”

 


BEST COURSE LIST

4-Hour Annuity Training Course

 

Succeed with Senior Clients

Advisors Guide to Medicare and Medicaid

 

The Advisors Guide To 401(k) Plans

Estate Planning

 

The Advisors Guide to Annuities and Ethical Practices

Ethics For The Insurance Producer

 

The Advisors Guide To Disability Insurance

Guide to Retirement Planning Strategies

 

The Advisors Guide to IRAs

Long Term Care Insurance Training Course

 

The Advisors Guide To Retirement Planning

NAIC 4-Hour Long-Term Care Insurance

 

The Advisors Guide To Social Insurance Programs

Retirement Income Strategies

 

The Advisors Guide to Social Security Benefits

Retirement Plans for Small Businesses

 

Understanding Social Security, Medicare and Government Benefits


 
 

Self-Study CE Course List

 

As a top-notch continuing education provider we:

  • Deliver CE to financial and insurance advisors
  • Offer up-to-date and industry pertinent CE courses that maximize credits
  • Provide ClearCert certified long-term care and annuity training CE courses
  • Supply CE courses that are approved in all 50 states and the
    District of Columbia

 

Order CE courses toll free: 1-800-345-5669 or local: 727-853-0575
OR send an email to self_study@brokered.net.

 
 

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Super CE Program

 
Super CE Programs
 

Top 5 reasons to schedule a Super CE program:

 
  1. Classroom course: 1-hour (instructor-led)
  2. Correspondence/self-study course: Provides up to 21 hours of state insurance CE and 5 or 10 hours of professional designation CE
  3. Increase meeting attendance and leverage your time
  4. Assist advisors in meeting their mandatory CE requirements
  5. Position your company’s strategy, product solutions and value-added programs
 
 
 

What Advisors Say...

 

“Thanks! This was the most enjoyable CE I’ve completed in my over 14+ years as an advisor. I’ll be back.”  ~ Raymond James Advisor


“I didn’t even need the CE, but took the class to expand my knowledge and understanding. Thank you BEST.”  ~ Merrill Lynch Advisor


“BEST has perfected the Super CE program!”  ~ Morgan Stanley Advisor


“Productive & effective use of time in meeting Continuing Education requirements.”  ~ Wells Fargo Advisor


“Excellent program, well worth the time!” ~ UBS Advisor

 

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BEST
 

BEST Information

 

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Disclaimer

 

Reproductions of our Advisor News Insight newsletter are prohibited unless you have received prior authorization from Broker Educational Sales & Training, Inc. (BEST), but you are free to email this copy (in its entirety) to colleagues.

 

This newsletter may not be posted to any website without written consent.

 

This newsletter is a digest of information published by a variety of web-based sources and is published as a service to our users. BEST is not the author of the material unless specifically noted.

 

Articles are copyrighted to their publishers. All links were tested before this newsletter was emailed to ensure that they are still functional, but publishers move and/or delete articles. Therefore, we cannot guarantee that the links provided will remain operational.

 

BEST does not endorse and disclaims any and all responsibility or liability for the accuracy, content, completeness, legality, or reliability of the material linked to in this newsletter. Reliance on this material should only be undertaken after an independent review of its accuracy, completeness, efficacy, and timeliness. Opinions expressed are those of the author of the article and do not necessarily reflect the positions of BEST.

 

THIS NEWSLETTER IS PROVIDED FOR
INFORMATIONAL PURPOSES ONLY AND DOES NOT
CONSTITUTE INVESTMENT, TAX, ACCOUNTING OR LEGAL ADVICE.

 

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