Worley Erhart-Graves Financial Advisors

NEWSLETTERKNOWLEDGE IS YOUR POWER
SECOND QUARTER 2017

Upcoming Workshop: Life’s Path is Paved with Cobblestones

Join us as we welcome speaker Jane A. Malkoff, MSN, RN,
NP, Co-Founder of Clarity Care Advocates, a healthcare
solutions, planning, and advocacy company. Jane’s expertise
and background in the healthcare system are valuable
resources to those wanting the best care possible, whether
during a hospital stay, while transitioning to a nursing home,
or when returning home after a crisis.

Jane will share information about how
we can prepare for a long life, while
reducing the age-related healthcare
stressors that many will face.

This workshop is ideal for those wanting to gain insight into
the healthcare issues seniors experience as they age and the
services required during and after a health crisis.

WORKSHOP DETAILS: WHEN: Thursday, July 27, 2017 from 6 - 7:30 p.m.

If you or someone you know would benefit WHERE: The Pyramids (3500 Depauw Blvd)
from attending this workshop, RSVP today! Light Pyramid Three, Lower Level, Conference Room B
refreshments will be served.
COST: None, but space is limited.
RSVP: By Monday, July 24, 2017
by calling 317-872-5090 or email
[email protected]

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.

The Benefits of a Qualified
Charitable Distribution Juli Erhart-Graves, CFP®

By nature, I am a very cost-conscious person. It is not As you may know, those who are 70½ and older are required
uncommon to see me in the grocery store, coupons in hand, to take money from their IRA each year. Generally, any money
reading the cost-per-unit prices on the different sizes of an distributed from an IRA is included in income on that year’s
item I want to buy so I can get the most bang for my buck. tax return and taxed at ordinary income tax rates. A charitable
(Some of you are saying, “Me, too!” while others had no idea deduction is then allowed after the income is totaled.
they put the cost-per-unit on shelf labels.) However, a QCD allows you to make a charitable contribution
directly from your IRA account and then exclude that amount
For those charitable-minded individuals subject to IRA from your income altogether. Because the contribution never
Required Minimum Distributions, there is another way to get hits your income, it lowers your Adjusted Gross Income (AGI),
more bang for your charitable buck—through a Qualified which may allow more deductions and other tax benefits. For
Charitable Distribution (QCD). example, a lower AGI may allow you to deduct more medical
expenses or avoid the Alternative Minimum Tax. In addition,
a lower AGI can help keep Medicare Part B premiums lower.
A QCD can be especially helpful for those using the standard
deduction, since charitable contributions cannot be deducted
otherwise.

The maximum annual exclusion amount for a QCD is
$100,000 per person and does not include SEP IRAs or SIMPLE
IRAs. You must be at least 70½ at the time of the distribution,
and a QCD can apply to an Inherited IRA Required Minimum
Distribution as long as the age 70½ qualification is met. In
addition, no charitable deduction is allowed for making the
QCD since the amount is not included in income.

Consider Consolidating Your Portfolio

Bonnie Struck, CMFC®

Often, investors feel they have a diversified portfolio because strategy—harvesting. Working with
they hold their investments at multiple custodians. They feel safer multiple custodians makes it more
spreading their assets around and not keeping them in one place. challenging to plan cashflow needs
However, maintaining multiple relationships is more complicated and track portfolio performance.
and can be more expensive. It is the investment selection process
that improves diversification, not where the investments are Obviously, “active” employer-
held. If the assets are consolidated, you will have an easier time sponsored retirement plans cannot be
managing them and developing a comprehensive plan. You consolidated, but that does not apply to
can reduce the potential for investment redundancy, work with “inactive” accounts. Over your career,
one fee structure, and implement a tax-efficient investment you may have worked for several
employers and participated in many

Tax Effects of Life Events

Pam Smitson, CPA, CGMA, Financial Planner

This tax season held many surprises, as there were life- In addition, you should address potential changes in your
changing events for several clients. Some were good. Some health insurance premium tax credit allocation or any loss of
were not so good. Some were downright devastating. Whether your health care coverage. Also, be cognizant any qualifying
you are getting married, having a child, getting separated or alimony payments you make may be deductible, whereas
divorced, suffering from a major illness, or recently widowed, child support is not. Along the same lines, you may have to
the last person you think to speak with is your CPA. However, report alimony as taxable income but not the child support
you may be surprised to learn about the many areas these you receive.
major life events can impact, including your taxes.
Most often, taxes are simply an after-thought. Understandably,
For tax purposes, you will need to reconsider your filing they are not at the top of anyone’s agenda when they
status to be prepared for differences in the taxation of each are dealing with these life changing events. However,
filing status. This planning necessity could last for a few personalized advice will help minimize the stress of dealing
years following the event and not just the current year. Also, with tax issues in the midst of significant change. Leave the
your withholdings may need to be adjusted for an increase surprises for birthdays!
or decrease in family income and dependents. Even your
deductions can be affected by your filing status and higher
income limitations.

If you have children in a marriage ending in divorce, the
question of which parent can claim exemptions, childcare
and education credits, as well as the many other items related
to dependents needs to be resolved. Be aware that the IRS
does not recognize the divorce decree. Instead, the division of
exemptions is based on agreement when filing the tax return
(filing a release of claim) or the number of overnights the child
is in your care.

Mutt Strut 2017 was unfortunately canceled this year due to severe weather, but we were still able to raise $985 for the Humane
Society of Indianapolis and matched that donation for Spay-Neuter Services of Indiana. Thank you to all who donated!

retirement plans. Why leave those instead of directly at shareholder services. The brokerage
retirement accounts behind and account can keep track of cost basis, stock splits, and mergers
possibly forget they exist? Rolling and provide a consolidated tax report annually. Buying and
them into a self-directed retirement selling stocks can be done inside the account in an efficient
account can make more sense, and manner for a nominal fee.
it will make it much easier when you
are required to begin mandatory Improving the administration of your investments with greater
distributions the year you reach 70½. efficiency allows you more control over your financial destiny.

Also, consider holding individual
stocks inside a brokerage account

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

We want to give a warm welcome to two new faces in our office, Jennifer and Gail!

Jennifer Foley serves as the firm’s Office Manager. She’s often
our clients’ first point of contact, whether on the phone or in
person. She helps maintain a smooth workflow through the
office, improving systems for increased efficiency and client
satisfaction. In her spare time, she enjoys spending time with her
family, photography, nature, and kayaking!

Gail Gill is a CERTIFIED FINANCIAL PLANNER™ practitioner
at our firm. She provides fee-only financial planning and
investment advisory services. From 1996-2013, she worked
for Charles Schwab in investment research and portfolio
construction. From 2013-2016, she worked at Pie Charts
Financial as an independent Registered Investment Advisor in
Austin, TX, implementing comprehensive financial plans and
investment strategies. In her spare time, she likes connecting
with friends and family while exploring new restaurants, biking
trails, and attending sporting events and music venues!