This Saturday - Goin' To The Chapel....

...but are you FINANCIALLY ready to get married?





We have two special guests joining us for this important discussion. Attorney Eric Strauss will answer our questions on the legal aspects of combining your finances, and Jaclyn Cornelius of Valley National Financial Advisors will help to field your financial concerns.


If you're preparing to walk down the aisle (or know someone who is!) you can't afford to miss this show! We'll also cover second marriages, blended families, prenuptial agreements, and so much more.

as always, visit http://www.yourfinancialchoices.com/ for more information or to contact us!

IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. federal tax advice contained in this communication, including any attachments, is not intended or written to be used, and cannot be used, for the purpose of 1. avoiding penalties under the Internal Revenue Code or 2. promoting, marketing, or recommending to another party any transaction or matter addressed herein.

Securities offered through Valley National Investments, Inc. - an independent broker/dealer and member FINRA and SIPC.

FAQ Friday - May 16, 2008

Q. In last week’s FAQ you mentioned that there are exceptions to the 10% penalty on withdrawals from 529 plans if not used for qualified education expenses. What are the exceptions?

A. I copied below the answer directly from the IRS Publication 970 Tax Benefits for Education:
Additional Tax on Taxable Distributions

Generally, if you receive a taxable distribution, you also must pay a 10% additional tax on the amount included in income.

Exceptions. The 10% additional tax does not apply to distributions:
1. Paid to a beneficiary (or to the estate of the designated beneficiary) on or after the death of the designated beneficiary.

2. Made because the designated beneficiary is disabled. A person is considered to be disabled if he or she shows proof that he or she cannot do any substantial gainful activity because of his or her physical or mental condition. A physician must determine that his or her condition can be expected to result in death or to be of long-continued and indefinite duration.

3. Included in income because the designated beneficiary received:
a. A tax-free scholarship or fellowship (see chapter 1),
b. Veterans' educational assistance (see chapter 1),
c. Employer-provided educational assistance (see chapter 11), or
d. Any other nontaxable (tax-free) payments (other than gifts or inheritances) received as educational assistance.

4. Made on account of the attendance of the designated beneficiary at a U.S. military academy (such as West Point). This exception applies only to the extent that the amount of the distribution does not exceed the costs of advanced education (as defined in section 2005(e)(3) of title 10 of the U.S. Code) attributable to such attendance.

5. Included in income only because the qualified education expenses were taken into account in determining the Hope or lifetime learning credit.

Exception (3) applies only to the extent the distribution is not more than the scholarship, allowance, or payment.

IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. federal tax advice contained in this communication, including any attachments, is not intended or written to be used, and cannot be used, for the purpose of 1. avoiding penalties under the Internal Revenue Code or 2. promoting, marketing, or recommending to another party any transaction or matter addressed herein.

Securities offered through Valley National Investments, Inc. - an independent broker/dealer and member FINRA and SIPC.

FAQ FRIDAY - May 9, 2008

Q. I received a notice from the IRS saying that I owe taxes on distributions from a 529 Plan. I know that the distribution was used for qualified education expenses of my child. What do I do?

A. In the past few years, we have started seeing people take distributions from the 529 Plan education savings accounts that they set up previously. Distributions from these plans must be used for qualified higher education expenses (QEE) to avoid the tax and penalty on the earnings. If the QEE exceeded the distribution we didn’t have to report the distribution or the education expenses unless the IRS asked for the information.

I have had clients recently receive these notices. We are responding to the IRS by reporting the QEE and showing that they exceed the distribution, thereby making it a qualified distribution not subject to tax. If the distribution exceeds the QEE, you must calculate the amount that should be taxable and if any of it is subject to the 10% penalty for not using it for QEE. There are exceptions to the 10% penalty so be aware of them.

IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. federal tax advice contained in this communication, including any attachments, is not intended or written to be used, and cannot be used, for the purpose of 1. avoiding penalties under the Internal Revenue Code or 2. promoting, marketing, or recommending to another party any transaction or matter addressed herein.

Securities offered through Valley National Investments, Inc. - an independent broker/dealer and member FINRA and SIPC.