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Published by Worley Erhart-Graves Financial Advisors, 2017-09-28 16:17:58

Worley Erhart-Graves Financial Advisors

3rd Quarter 2017 Newsletter

Keywords: 3rd Quarter 2017 Newsletter

NEWSLETTERKNOWLEDGE IS YOUR POWER
THIRD QUARTER 2017

Upcoming Workshop: Understanding Your Form 1040
and Using it to Your Benefit

Perhaps the greatest service a CPA can provide a client
is to explain the workings of a tax return–and not just
the bottom line. Join Pamela Smitson, CPA, co-owner
of Smitson Erhart-Graves Tax Advisors, as she walks you
through the basics of Form 1040 U.S. Individual Income
Tax Return and Schedule A Itemized Deductions.

Learn more about the types
of income, deductions, and
credits, along with the effects
and misconceptions of the most
common line items.

This workshop is designed for those who want a better
understanding of where the numbers come from and
how they can be used in tax planning.

WORKSHOP DETAILS: WHEN: Tuesday, October 24, 2017 from
6 – 7:30 pm
This workshop is open to everyone.
Light refreshments will be served. WHERE: The Pyramids, Pyramid Three,
Lower Level, Conference Room A
RSVP: By Friday, October 20, 2017 to (3500 DePauw Blvd, Indianapolis, IN 46220)
[email protected] or
317-872-5090 COST: None, but space is limited.

Worley Erhart-Graves Financial Advisors is a Registered Investment Advisor. Registration as an investment advisor is not an endorsement of the firm by
securities regulators and does not mean the advisor has attained a particular level of skill or ability. All expressions of opinion reflect the judgment of
the authors as of the date of publication and should not be construed as personalized investment advice. Different types of investments involve varying
degrees of risk, and there can be no assurance that any investment will either be suitable or profitable for a client’s portfolio. Worley Erhart-Graves Financial
Advisors is not engaged in the practice of law or accounting. Always consult an attorney or tax professional regarding your specific legal or tax situation.
Worley Erhart-Graves Financial Advisors, Inc., is affiliated with Smitson Erhart-Graves Tax Advisors, LLC, through common control and ownership. Smitson
Erhart-Graves Tax Advisors provides accounting and tax preparation services. If you require such services, we may recommend you use Smitson Erhart-
Graves Tax Advisors, although you are under no obligation to do so. Fees for financial planning and investment advisory services are separate and distinct
from the fees Smitson Erhart-Graves Tax Advisors charges for their services.

Time to Reevaluate Your Medicare

Juli Erhart-Graves, CFP®

have had a diagnosis of a major health condition, or you
have already experienced gradual premium or out-of-pocket
increases over time, reassessing your coverage is a must.

Fall is just around the corner. Soon the leaves will start turning To prepare for your insurance checkup, prepare a detailed
colors, the days will get cooler, and we will gain an hour when list of all your medications with dosages and the names,
daylight saving time ends. Fall is also open enrollment time for addresses, and phone numbers of all your healthcare
Medicare users. This is a great opportunity for an insurance providers. Watch for your new plan benefit summary to
checkup to make sure you are getting the best coverage at the arrive from your current insurance company, so you have
best price on your Medicare Part C (Medicare Advantage Plan) your current coverage and costs as a reference to compare
or Part D (prescription drugs) plans. coverage. Then contact the company to find out if there will
be any change in coverage for your specific medications.
Also consider contacting your healthcare provider to verify
they will continue participating in your plan. Armed with this
information, you can now get pricing from other insurance
carriers to make sure you have the best coverage based on
your needs. If you need help, the State Health Insurance
Program (SHIP) through the Indiana Department of Insurance
provides free assistance, or you may want to work with an
experienced Medicare broker.

In the current volatile healthcare environment, do not be Medicare open enrollment begins October 15 and ends
surprised to see premiums rise and additional cost increases December 7 for coverage to begin January 1. Put your extra
hidden in higher out-of-pocket maximums or more expensive daylight savings hour to good use and start your preparations
drug tiers. All of this makes this year a prime time to shop today.
around. If your prescription medications have changed, you

Nothing in Life is Free

Bonnie Struck, CMFC®

Remember the line in the Wizard of Oz, “Pay no attention company pays directly to the advisor as compensation.
to the man behind the curtain”? This reminds me of a This is a one-time commission fee, but as an investor you
question I hear often: “Why would I want to pay you fees also pay 12b-1 fees. These are ongoing fees paid to your
when my current advisor doesn’t charge me anything?” advisor to service your accounts, and they are typically
This is because the advisor isn’t paid directly. Instead, 0.25% or $25 annually on your $10,000 investment. Again,
everything is done “behind the curtain.” it is your $25 going to the advisor annually.

Pull the curtain back and it can be a real eyeopener. For Since the Great Recession, investors have been more
example, if you invest $10,000 in a commission-based aware and sensitive to fees and are evaluating the value
product and the commission rate is 5.75%, only $9,425 of services they are receiving from advisors. Over the past
($10,000 - $575) is invested. Your $575 is what the fund 15 years, the investment industry has been shifting from

Quarterly Estimated Tax Payments: Why, When,
and How Much? Pam Smitson, CPA, CGMA, Financial Planner

Tax preparation consists of more than just preparing the is expected. The goal of quarterly estimates is to protect the
return. One item I review is the need for quarterly estimated taxpayer from penalties. However, too much withholding
tax payments. The only cushion in avoiding under-withholding is also to be avoided because it deprives the taxpayer from
penalties without paying estimates is if the taxpayer’s bill, when valuable cash flow.
all is said and done, is less than $1,000. Otherwise, under-
withholding penalties may apply. Why, you may ask? Have you The IRS understands that circumstances change tax liabilities
ever heard the phrase, “because I said so”? Well, place the IRS in from year to year. Therefore, there is an alternative to paying
the position of power here–not your tax preparer! in a minimum of the prior year tax. The 90% rule is used in
these circumstances and is calculated (I use the term loosely
Quarterly tax estimates are due in April (as if you need another because it is more of a guess) on the current year (2017) tax
tax bill in April), June, September, and the following January. liability. This can be a challenge because the due dates of
They are usually needed when the taxpayer has income the quarterly estimates occur before the actual tax liability is
without the appropriate withholding to cover the tax liability. known.
This happens when withholdings are not enough (resulting
from taking too many exemptions against your wages) or You may ask, “Do I need to pay them even if my preparer
ignored completely (not having any withholdings applied from provides them?” The answer rests with you. I recommend you
retirement distributions or Social Security). Estimates may also pay them. However, the worst case scenario is that you will
become an issue due to income where withholdings are not need to pay the penalty on top of the tax due in April.
an option, such as interest, dividends, capital gains, and flow-
through or sole proprietor business income.

The IRS rules base expected withholdings on the prior year tax
liability (2016). Depending on the taxpayer’s Adjusted Gross
Income (AGI), either 100% or 110% of the prior year tax is
expected to be paid in to avoid an underpayment penalty. If
the taxpayer’s AGI is $150,000 or more, the higher percentage

We want our reputation to earn your business and our service to earn
your referrals. Please pass our name along if you know someone who

needs help taking control of their financial future of tax situation.

commission products to fee-only products. The fee-only
structure is more transparent and helps ensure nothing is
going on “behind the curtain.” Because our fee-only firm
charges 0.50% for investment advisory service, you would
pay our firm $50 ($10,000 x 0.50%) and not $575 for a
$10,000 investment. We are also required to issue invoices
to our clients showing how much they were billed for our
investment services, further demonstrating transparency.

STANDARD PRESORT
US POSTAGE
PAID

INDIANAPOLIS, IN
PERMIT NO. 937

3500 DePauw Blvd. | Suite 1035
Pyramid One, Third Floor
Indianapolis, IN 46268

317.872.5090 Phone
855.872.5090 Toll Free
317.872.5095 Fax

wefinancialadvisors.com

Upcoming Events and Sponsorships

Indy Women’s Half Marathon SNSI Hair Ball

We are a proud sponsor for the 2017 Indy Women’s We’re so excited to be a part of this fundraiser for
Half Marathon and 5K on September 30. This event Spay-Neuter Services of Indiana, Inc. SNSI Hair Ball is an
helps support W.I.N, or Indiana Women in Need. After annual event, which has raised more than $250,000 to
the race, we will be volunteering at the results tent, supports SNSI’s work in helping every shelter become
cheering on all the runners crossing the finish line! We a no-kill shelter. If you are interested in joining us on
have a small number of entries left. If you’re interested Saturday, October 5 from 6– 11 p.m. at the Delaware
in participating in the half marathon or 5K, please call Township Community Center, we have a few tickets
Annie at 317-872-5090. available! Please call Annie at 317-872-5090.

Learn more at www.indywomenshalfmarathon.com. Learn more at www.indyhairball.org.


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