Freeman's Blog


April 30th, 2014 by

Just Ask Freeman – Tax Implications On Your Retirement Money

Taxes are not preventable completely. Whether you buy something, save something, spend something or pass away, there is a tax implication associated with your money. Watch this segment of Skills To Pay The Bills TV Show to learn how to minimize the tax “bite”

Skills To Pay The Bills TV Show

Q: How do I prevent the IRS from taking a large portion of our retirement money?
A: There’s no way to prevent paying taxes. Whether you’re earning money, spending money, saving money and when you pass away, you cannot get away from paying taxes. However, to minimize the tax “bite” is to utilize tax deferral.

Tax deferral is defined as receiving interest 3 ways on your nest egg:
1. Interest on your interest
2. Interest on your principle
3. Interest on the money you would ordinarily have to pay Uncle Sam.
So, you can pay the taxes when you’re ready.

Ask Your Retirement Money Questions

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If you have a retirement money question, post your questions on our Facebook page or email and we will strive to answer as many of your questions as possible. Freeman offers no-obligation, free consultations in his Maryland office to help retirees and pre-retirees make the most of their retirement nest egg.
April 28th, 2014 by

Charitable Trust: Tax Benefits

Americans give freely to support the causes they value, from churches, education, the arts and medical research. Fortunately, current tax laws encourage and even reward philanthropy. Beyond the basic tax deductions for charitable giving, here are some benefits for setting up one of the following types of trusts:

Charitable Remainder Trust

When money, property, or other nest egg dollars are placed in a properly structured charitable remainder trust, the grantor or the grantor’s beneficiaries receive payment of a specified amount at least annually.

For the grantor, there are a few potential tax benefits:

  1. Assets placed in the trust may qualify for an income tax deduction on the estimated present value of the remainder interest that will eventually go to charity.
  2. At death, trust assets are not subject to estate taxes because they are no longer part of the grantor’s taxable estate.
  3. Any appreciated assets in the trust are also exempt from current capital gains tax.

Charitable Lead Trust

A charitable lead trust is an estate conservation tool that uses the grantor’s assets to provide income to a charity. At the end of the trust period, the remaining assets are paid to the grantor or the grantor’s beneficiaries. This type of trust could potentially reduce the estate tax due upon death, most notably on highly appreciated assets, because they are not subject to current capital gains tax.

Keep in mind that donations to both types of charitable trusts are irrevocable. This means that the assets cannot be withdrawn once the trust is formed. Also bear in mind that not all charitable organizations are able to use all possible gifts. It is prudent to check first. The type of organization selected can also affect the tax benefits that may be received.

When structured properly, these tools could possibly be used to benefit the charities of your choice and also help to reduce your tax obligations at the same time.

Teaming Up With Professionals

The use of trusts involves a complex web of tax rules and regulations. You should consider the counsel of an experienced estate planning professional and your legal and tax advisors before implementing such strategies. Trusts incur upfront costs and ongoing administrative fees.

Freeman Owen, Jr - Host of "Safe Money Talk" on CBS Radio The Big Talker 1580AM Even if I’m not the right person to help you with your specific need, I have worked with professional CPAs, estate planners, and tax professionals for over 30 years. But, charitable trusts must be setup correctly in your retirement plan. So, let’s look at your current retirement plan and determine the best next step in your retirement strategy.
Just Ask Freeman | 1-833-313-7233 | MD, VA & DC.
April 25th, 2014 by

Retirement Plan Limits 2014

How Much Money Can I Put into My IRA or Employer-Sponsored Retirement Plan?

IRAs and employer-sponsored retirement plans are subject to annual contribution limits set by the federal government. The limits are periodically adjusted to compensate for inflation and increases in the cost of living.


For the 2014 tax year, you can contribute up to $5,500 to all IRAs combined (the limit will be adjusted annually for inflation). If you have a traditional IRA as well as a Roth IRA, you can only contribute a total of the annual limit in one year, not the annual limit to each.

If you are age 50 or older, you can also make a $1,000 annual “catch-up” contribution.

Employer Sponsored Retirement Plans – 401(k) & 403(b)

Employer-sponsored retirement plans such as 401(k)s and 403(b)s have a $17,500 contribution limit in 2014; individuals aged 50 and older can contribute an extra $5,500 each year as a catch-up contribution.

If you are currently contributing to an IRA or an employer-sponsored retirement plan, it may be wise to check the contribution limit each year in order to put aside as much as possible.

Distributions from traditional IRAs and most employer-sponsored retirement plans are taxed as ordinary income and may be subject to an additional 10% federal income tax penalty if taken prior to reaching age 59½. If you participate in both a traditional IRA and an employer-sponsored plan, your IRA contributions may or may not be tax deductible, depending on your adjusted gross income.

Retirement Advice | Just Ask Freeman

There are many “if”, “and” and “but” clauses that can be pitfalls for your retirement plan when you try to do it all alone. Don’t take this expensive chance with your retirement money. Download any of my FREE resources for retirement planning.

Protecting Your Retirement Nest Egg Let me help you navigate retirement planning so that you can keep your money safe and enjoy a worry-free retirement.Toll Free: 1-833-313-7233 | MD, VA & DC.
April 21st, 2014 by

Living Longer- retirement planning
Many pre-retirees either underestimate or over estimate how long they will live. For example, over estimation means you think you’ll live to 100 years old, and therefore you make plans to reach that age, but you only make it to age 95. But, 56%-62% of surveyed participants under estimated how long they will live. This type of survey indicates that people do not foresee living as long as they actually will. With advances in health care technology, it is no wonder that longevity is actually on the increase. That’s celebratory news for you to enjoy a longer life filled with happy moments. But, it’s a scary reality if you’re not sure you are going to be able to afford to keep living.

According to data compiled by the Social Security Administration:

  • A man reaching age 65 today can expect to live, on average, until age 84.2
  • A woman turning age 65 today can expect to live, on average, until age 86.2

And those are just averages. About one out of every four 65-year-olds today will live past age 90, and one out of 10 will live past age 95.2

It’s About Accurate Retirement Planning

Nobody wants to fear their retirement years and feel insecure about whether they will outlive their resources. So, be better prepared. Let me help you prepare for retirement by keeping your money safe.
Toll Free: 1.833.313.7233 | Just Ask Freeman for a free, no-obligation consultation. | MD, VA & Washington DC

1. Society of Actuaries, 2012
2. Social Security Administration Life Expectancy Calculator

April 15th, 2014 by

Roth IRA Retirement Planning

More than 20 million U.S. households owned a Roth IRA in 2012.

Roth IRA owners can look forward to a time when their qualified withdrawals will be tax-free, regardless of how much growth the account experiences (under current tax law). A qualified withdrawal is one that meets the five-year holding requirement and takes place after age 59½ or results from the owner’s death or disability. A Roth IRA can be a flexible way to save for retirement as well as other needs. Because contributions are made on an after-tax basis, they can be withdrawn without penalty at any time, for any reason.

There are a few handy exceptions to the 10% penalty for early withdrawals. For example, a distribution may be penalty-free if used to purchase a first home ($10,000 lifetime maximum), pay qualified higher-education expenses, or pay unreimbursed medical expenses that exceed 10% of adjusted gross income (7.5% AGI for individuals aged 65 and older through 2016). You can make IRA contributions for the previous tax year up to the April 15 tax filing deadline. The maximum annual contribution to all IRAs combined in 2013 and 2014 is $5,500 ($6,500 for those 50 and older). You must have earned income to contribute to an IRA. Eligibility to contribute to a Roth IRA phases out at higher modified AGI levels: $114,000 to $129,000 for single filers and $181,000 to $191,000 for married couples filing jointly in 2014.

Source: Investment Company Institute, 2013

Getting The Right Retirement Advice

Freeman Owen, Jr - Host of "Safe Money Talk" on CBS Radio The Big Talker 1580AM Freeman Owen, Jr has been helping baby boomers plan for a worry-free retirement for over 30 years. If you’re thinking more about your retirement, consider getting professional help with it. Keep Your Money Safe! No-obligation consultations available in Maryland, Washington DC and Virginia.

Call: 1-833-313-7233