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Am I on Track?

Look to us and count on our experience to help put you on the path forward to your goals. We will work with you to develop a strategic plan to help you prioritize what needs to be accomplished at different starting points in your life. We will then help you implement any needed changes and monitor your progress over time. Just like taking a trip, you can travel any road and get somewhere, but if you know where you want to go, then you must plan what roads to take. Taking a little time to plan now will help ensure you ultimately get where you want to go. Just know that you don’t have to travel solo.

Planning Considerations

  • Maximizing pre-tax savings for retirement
  • Employee benefit decision and review
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  • Business and career planning
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  • Will, Power of Attorney and Health Care Proxies
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When can I make the leap?

Determining your income needs during retirement is a complex equation. The challenge is managing a portfolio by withdrawing some money for today’s expenses and investing the rest for the future. We can help you take inventory of your situation and project out your retirement cash flow. This foundation shapes your asset and portfolio allocation decisions heading into retirement. We will set you on a course for a safe, sustainable withdrawal plan considering your assets and potential sources of income. And we will help you coordinate and optimize the liquidation of your retirement and investment accounts considering income taxes and required minimum distributions.

Planning Considerations

  • Business succession planning
  • Retirement cash flow projections
  • Calculating a sustainable withdrawal rate
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  • Creating income from investments
  • Executive Benefit planning
  • Pension payout decisions
  • Annuity and Deferred Compensation options
  • Life, Disability and Long Term Care insurance
  • Planning for an inheritance
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Can I make my money last?

Inflation, longevity, the method which you withdraw your income and the random sequence of your returns are some of the key risks to your retirement. Even after calculating your retirement spending needs and saving early and often, these risks, if not planned for, could still have you falling short of your goals. Your ACM Wealth Advisor will build an income optimization plan that will take into account these concerns and help you extend your cash flow in the most efficient manner possible.

Planning Considerations

  • Ongoing monitoring of cash flow (income, expenses and income taxes)
  • Recognizing inflation & longevity
  • Managing investment allocations for a long retirement
  • Optimizing proper withdrawal order in retirement
  • Managing income taxes
  • Roth IRA conversions
  • Rising health care costs
  • Taking care of dependent parents/children
  • Home health care and life care community options
  • Downsizing
  • Reverse mortgages
  • Medicaid planning
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How will I be remembered?

The term legacy is often associated with the rich and famous or to a large amount of money left to someone. More broadly, our legacy may entail the transfer of values, goals or dreams, memories and, yes, financial assets. And for some, it’s the hope of not being a burden to family or someone else. It’s entirely personal.

As your wealth grows, your financial legacy may become more complex. With more assets and greater value, additional considerations (asset protection, family harmony, estate transfer and gift taxes) come into play. In addition to our expertise, we work with your existing advisors and experts in the fields of estate planning, taxes and philanthropy on a regular basis to ensure that your estate plan is in order.

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Last Minute Retirement Planning Before Tax Day

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  • Last Minute Retirement Planning Before Tax Day

Steve Cash, CFP
by Steve Cash, CFP

Although it’s already March 2023, there is still time to make last-minute retirement plan contributions for 2022 that could potentially lower your tax bill today or in the future.  While most tax-savings contributions have to be completed within the calendar year (December 31st) to count for the tax year, contributions to certain retirement accounts such as Traditional IRAs, Roth IRAs, HSAs and SEP IRAs can be completed before Tax Day, which is April 18th 2023.

INDIVIDUAL RETIREMENT ACCOUNTS (IRAs)

The annual contribution limit for 2022 for IRAs is $6,000 if you’re under the age of 50 and, if you’re over 50, you’re allowed an additional $1,000 contribution to total $7,000.

You can fully deduct the contribution to a traditional IRA if neither you nor your spouse is covered by a retirement plan at work.  If only one spouse has a workplace plan, the other can get a full deduction for IRA contributions if their joint income is $204,000 or less.  A single taxpayer with a workplace plan gets a full deduction with an adjusted gross income of $68,000 or less.

For Traditional IRAs, there are no income limitations to contribute, but for Roth IRAs there are different limitations for different tax filers.

ROTH IRAs

For tax year 2022, Roth IRA contributions start to become limited for most single filers begin at $129,000 of adjusted gross income (AGI) and $204,000 for most married joint filers.  Before you make a Roth IRA contribution, please confirm your income with your Wealth Advisor so you can avoid future headaches and/or IRS penalties with over contributing.

Roth IRA contributions aren’t deductible and anyone with earned income can open an IRA.  Pensions, Annuities, Unemployment or worker’s compensation, or Social Security are not considered sources of earned income.

Taxpayers who earn too much to make contributions directly to a Roth IRA can still do so via a two-step process known as a “backdoor Roth”.  First, you open and contribute to a traditional nondeductible IRA. Then, you open a Roth IRA and immediately transfer the traditional IRA money into a Roth IRA.  You’d normally pay any income tax on the IRA earnings when making the transfer, but there should be little to no earnings if you do it quickly and then you’ll have the funds growing tax-free in a Roth IRA.

While the backdoor Roth IRA sounds straightforward (because it is), the tax implications can become a bit more complicated if you have other IRAs funded on a pre-tax basis so you should check with your Wealth Advisor to confirm the rules before proceeding.

SEP-IRAs

For taxpayers with self-employment income, the contribution limit for SEP-IRAs is $61,000 for tax year 2022.  In many cases, savers can make contributions for 2022 until Oct. 16, 2023, if they have requested an extension to file their returns.  Business owners may put money back into their businesses, which is great for growing the business but neglects savings for themselves.

HEALTH SAVINGS ACCOUNTS

The HSA (Health Savings Account) contribution limits for 2022 are $3,650 for self-only coverage and $7,300 for family coverage. Those 55 and older can contribute an additional $1,000 as a catch-up contribution.  You have until the tax filing deadline. April 18, 2023, to contribute to an HAS for 2022.  To contribute to an HSA, you must be enrolled in an HSA-eligible health plan.  For 2022, this means 1) it has an annual deductible of at least $1,400 for self-only coverage and $2,800 for family coverage and 2) its out-of-pocket maximum does not exceed $7,050 for self-only coverage and $14,100 for family coverage.

HSAs offer triple tax benefits in that you get a deduction for your contribution, your contributions grow tax-deferred, and you can make withdrawals on a tax-free basis for qualified medical expenses, which means that it’s a great vehicle for retirement planning.

If you’d like to make any last minute contributions to any of the above accounts or set yourself up for a successful 2023 tax year, please reach out to your Wealth Advisor.

The foregoing content reflects the opinions of Advisors Capital Management, LLC and is subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. Past performance may not be indicative of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. Securities investing involves risk, including the potential for loss of principal. There is no assurance that any investment plan or strategy will be successful.
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ACM Wealth is the wealth management team of Advisors Capital Management, LLC (“ACM”). ACM is an investment advisor registered with the United States Securities and Exchange Commission. Registration does not imply a certain level of skill or training. All written content on this site is for information purposes only. Opinions expressed herein are solely those of ACM, unless otherwise specifically cited. Material presented is believed to be from reliable sources and no representations are made by our firm as to another parties' informational accuracy or completeness. All information or ideas provided should be discussed in detail with an advisor, accountant or legal counsel prior to implementation. All investing involves risk, including the potential for loss of principal. There is no guarantee that any investment plan or strategy will be successful.
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