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Sweeping Changes to Retirement Planning

Required Minimum Distributions Change 2020Sweeping change is coming to the way you plan for your retirement. Congress passed the SECURE (Setting Every Community Up for Retirement Enhancement) Act as part of a huge government spending deal at the end of 2019. Gilmore Jasion Mahler is already getting questions from clients wondering how they’re affected by the changes.  

While the SECURE Act includes a number of changes that will impact retirement planning, the change with perhaps the most immediate impact involves the age at which individuals need to start taking required minimum distributions (RMDs) from their retirement accounts. As of the year 2020, that age has been changed to 72 years old from the former age of 70-and-a-half years old. Here’s an important note: If you were 70-and-a-half at the end of 2019, you are not impacted by the law change, and will still need to start taking your RMDs at 70-and-a-half years old.

The SECURE Act brings other retirement planning changes as well, including:

  • Increasing restrictions on how non-spouse beneficiaries stretch out RMDs from a loved one’s retirement account
  • Allowing people who work past the age of 70-and-a-half to contribute to an IRA (with some restrictions)

What should you do?

The SECURE Act could change how you plan for your retirement in a number of ways. It is important that you consult with your GJM tax advisor to understand the impact as it relates to your personal situation. You can learn more about GJM's tax experts and our team capabilities here.

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting and provides comprehensive services including assurance, business advisory, tax, risk advisory, healthcare management and outsourced accounting. The firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.  

Tax Partner Steve Schult to Retire

After 21 years with Gilmore Jasion Mahler (GJM), Tax Partner Steve Schult has decided it is time to retire at the end of 2019. Steve works with many different clients, from individuals to family businesses to multi-national companies. Aside from his client service, he is a career advisor to young professionals within the firm and has taken an active role in GJM’s community service efforts. As he prepares to retire, he took some time to reflect on his years of client service and his time at GJM.

What do you like most about the work you do?

Steve: Getting to know and working with clients - and helping them not only save taxes, but also make decisions that are best for their businesses and their families. I have always said that taxes are a piece of your decision, not the whole decision. Being in public accounting my whole career, I also always appreciated the fact that I was working with the best and the brightest.  I learned something every day from not only my other partners, but everyone in the firm.

What made you decide to retire now?

Steve: My wife Diane and I both had some prior health issues.  We are fine now, but it makes you realize that life is short.  It’s time to slow down and smell the roses.  (For you Michigan fans, just FYI, you smell a lot of roses when you go out to the Rose Parade and the Rose Bowl!)

What will you miss the most?

Steve: That’s easy – the daily interactions with clients and the people at GJM.  I am extremely lucky to have worked with so many smart, quality and fun people in my career.  I already know I will struggle with that.

What will you miss the least?

Steve: That’s easy too - Keeping track of time daily and the constant tax deadlines.

Favorite story about helping a client with a tax problem?

Steve: There are actually two stories.

Early in my career I had a 70-year-old client who owed a lot of money on his tax return because he had a large capital gain that was missed in his year-end planning.  I felt it would be best to meet with him to personally review the return.  I called and said I would like to meet him to review his return with him – and he said to meet him at his office on my way in to work the next morning.

After losing sleep that night thinking about the meeting, I met him at his office the next morning.  Upon entering his office, he said “Stevie, you are never going to believe what I got it the mail yesterday when I got home from work.  I applied for tickets to the Masters golf tournament 40 years ago and was informed that I am finally off the waiting list. I now have four tickets to the Masters for the rest of my life!”  Upon asking what I wanted to discuss with him I said, “You owe $25,000 on your tax return”.  He said “Stevie, no problem – I don’t care.  You must not have heard me.  I now have four tickets to the Masters for the rest of my life!”  Timing is everything!  

I also had a large business client who was going through a tough IRS audit.  While most IRS auditors I worked with were pretty reasonable, the agent on this case was very difficult.  Wanting to hopefully resolve a few issues with him, the client and I met with him one day right after he had gotten back from the eye doctor – and he was wearing sunglasses because his pupils were dilated.  Having recently watched some poker tournaments on TV, I semi-jokingly told him it wasn’t fair that he was wearing sunglasses during a negotiation.

After failing to come to an agreement, we requested a meeting with him and his case manager to hopefully resolve our issues.  Upon entering the meeting a few days later, the client team and I were all wearing sunglasses.  The IRS case manager was very amused by this, setting the tone to finally get the issues on the audit resolved.

Favorite memory or story from your time at GJM?

Steve: While there are many, my favorite memory is from our involvement with Flag City Honor Flight.  The night we raised over $125,000 we were all in shock.  Going to Washington DC as a guardian on one of the flights was also a memory I will never forget – and is something I would encourage everyone to do.

What are your plans in retirement?

Steve: Getting in shape; learning to play the guitar; hiking a few times a week in Oak Openings with my two dogs (they keep me walking at a brisk pace); XC-skiing; fly-fishing; learning woodworking from my dad and helping him on the family farm; more time with Diane, (which she may regret) kids and grandkids; getting more active on a few boards; travel; and many more fun adventures that I don’t even know about yet.

Do you have any travel scheduled?

Steve: Yes.  XC-skiing trip in January, visit cousins in Lake Tahoe in February, finally getting to go to Detroit Tigers spring training in Lakeland Florida in March, a trip to hike in the Scottish Highlands this summer, and other trips with kids/grandkids that we haven’t quite finished scheduling yet.

Are you totally disconnecting from GJM or will you be around for client issues, etc.?

Steve: While I don’t want to interfere with other people at GJM developing their own relationships with clients I worked with in the past, I will still be in the Toledo area and will be available as needed.  I want to make sure there is a smooth transition and want to also make sure our clients are being properly served.  I’m sure I could add historical perspective that may be helpful in some situations.   

Will you still stay involved in some GJM events, like the Big Brothers Big Sisters Holiday Party and Flag City Honor Flight?

Steve: If I am not traveling, I would certainly be available to help with the many great causes GJM has supported over the years.

There’s been a lot of change in the accounting industry during your time in the field.  Do you have any advice you’d give to young people pursuing the field now?

Steve: Every industry is constantly changing.  I think the best advice for any young person is pretty easy:  Work hard, communicate, get involved in your community, and show your clients, your family and the people that work with you that you appreciate and care about them.

Anything else you’d like to add?

Steve: As I mentioned before, I know I will miss the constant interactions with clients and the people at GJM.  Those people become part of your family.  I am not leaving the Toledo area.  Now that I will have the time, hopefully people will still occasionally call me for breakfast, lunch, dinner, fishing, etc.  I know Diane will appreciate them getting me out of the house and out of her hair for a while!

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting and provides comprehensive services including assurance, business advisory, tax, risk advisory, healthcare management and outsourced accounting. The Firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.  

GJM Staff Announcements

Gilmore Jasion Mahler, LTD (GJM) has announced some key promotions and new staff members that strengthen the Firm and its leadership team. The promotions are effective January 1, 2019.

Judy Anderson Gilmore Jasion MahlerJudy Anderson and Matt Cavanagh are promoted to partner. Anderson, a Toledo native and graduate of The University of Toledo has been with the firm for 11 years. She has over twenty years of experience in public accounting and in the healthcare industry. A member of Gilmore Jasion Mahler’s healthcare and outsourced accounting group, she works with many of the Firm’s healthcare clients providing practice management and consulting services.  

Matt Cavanagh Gilmore Jasion MahlerCavanagh, a Bowling Green native and BGSU graduate, joined Gilmore Jasion Mahler in November of 2005. Also a member of the Firm’s healthcare team, Matt’s focus is healthcare services. His expertise is in ambulatory surgery centers, outsourced accounting, practice management and modeling.

“Judy and Matt are already valued members of our leadership team,” says Gilmore Jasion Mahler Managing Partner Kevin Gilmore. ”Their hard work and dedication have strengthened our healthcare specialty and the Firm as a whole. I’m thrilled to see them both reach partner level.”

Nikki Clement Gilmore Jasion MahlerThe Firm also announced some other key promotions. Partner Nikki Clement has been named managing partner of Gilmore Jasion Mahler’s Findlay office. Partner Mike Brough will lead growth efforts for the Findlay office. Nikki Clement's focus is the utilities industry. She specializes in accounting for regulated utilities.

Mike Brough Gilmore Jasion MahlerMike Brough works across a number of industries including manufacturing & distribution, government, and nonprofit operations.

Steve Miller is being promoted to senior manager. Both Ryan Avery and Ryan Emerson are promoted to supervisor and Nick Jackson is promoted to senior associate.

Earlier in the year, Diane Stretten and Mary Jo Pitzen were promoted to senior manager. Andrea Jennex moved up to supervisor in the GJM Findlay office. Ben Lochbihler was promoted to manager and Corey Selhorst, Lauren Grana and Clay Barron were all promoted to senior associate.

The Firm also brought on well over a dozen new employees in 2018 to further strengthen GJM’s administrative team and client service. They include Elijah Blackburn, Alyssa Essert, Alexandria Frances, Courtney Haas, Nicole Hartranft, Jennifer Henning, Dana Herr, Thomas Keyser, Jessica Knepper, Dylon Lause, Wendy Long, Tim Merkel, Madeline Mielcarek, Caleb Neeper, Joe Osentoski, Tina Rochowiak and Logan Sager.

“I couldn’t be happier with the staff we have in place headed into 2019,” says Gilmore. “When you have great people, great things happen. I’m excited to see what we can accomplish at a team.”

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting services and provides comprehensive services including assurance, business advisory, tax, risk advisory, healthcare management and outsourced accounting. The Firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.

Don’t Overlook This Tax Credit

Mary Jo Pitzen is a senior manager in the Gilmore Jasion Mahler tax department. She works with clients across many industries, but has a focus on the construction industry. Mary Jo is also a board member for the Toledo chapter of the National Association of Women in Construction (NAWIC).

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting services and provides comprehensive services including assurance, business advisory, tax, risk advisory and healthcare management. The Firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.

Strategies for Tax Savings Under the New Tax Law

tax saving strategy, gilmore jasion mahlerWant to save money on your 2018 tax bill? Sure you do! Things have changed dramatically with tax reform, but there are still ways to save.

Many taxpayers will benefit from the reduced tax rates and expanded tax brackets included in the new tax law. The law’s changes also make it less likely that as many taxpayers will itemize deductions. They will opt to use the higher standard deduction, which nearly doubled for individuals to $12,000 with the passage of the new law. The Married Filing Jointly standard deduction increased to $24,000 and the Head of Household standard deduction went up to $18,000.

If you’re among those who will wind up taking the increased standard deduction, be aware that payments for taxes, mortgage interest, and charitable donations will no longer yield any tax savings. But, there are still strategies for some taxpayers to reduce their tax liability while taking the standard deduction and making charitable deductions.

One way to save is using something called a Qualified Charitable Distribution (QCD) when donating to a favorite charity. A QCD allows a transfer of up to $100,000 per year from an IRA directly to a qualified charity. Here’s the catch: it is only available to those who have reached Required Minimum Distribution (RMD) age which is 70½. Any amount processed as a QCD counts towards the Required Minimum Distribution requirement while at the same time reducing the taxable portion of the distribution. By lowering both adjusted gross income and taxable income, the taxpayer has a lower federal tax liability and potentially a lower state tax liability and the charitable organization receives a contribution. 

Some important things to remember when choosing to use a QCD:

  • Notify your tax preparer that this has been done since the custodian of the IRA is not required to specially identify the QCD on form 1099-R. Otherwise the QCD may be accidentally reported as taxable income
  • If RMD payments are set up to be paid automatically, the payment may need to be halted or adjusted to leave funds available for a QCD

Another strategy that applies to taxpayers of any age is so-called “bunching” of tax deductions, or grouping them together to get the most tax benefit. If the total of your eligible medical expenses, allowed state and local tax payments, mortgage interest and charitable contributions is close to the standard deduction, it might be beneficial to bunch itemized deductions every other year so that the total exceeds the standard deduction.

Some other thoughts on “bunching”:

  • Consider getting elective surgeries and expensive dental procedures or buying new glasses all in the same year
  • Prepay real estate taxes to reach the new $10,000 limitation on state and local tax deductions
  • Double up on regular charitable donations every other year

By bunching as many deductions into one year as possible, the total may surpass the standard deduction. On the off years you can take advantage of the standard deduction.

Marie Saner, Gilmore Jasion MahlerTax Supervisor Marie Saner, EA contributed this blog. With Gilmore Jasion Mahler for 14 years, Marie works with individuals and businesses across many industries. She is a member of the Firm’s Construction Specialist Team.

 If you’re interested in receiving more tax planning ideas right to your inbox, click here to sign up for GJM’s free quarterly tax newsletter Focus.

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting services and provides comprehensive services including assurance, business advisory, tax, risk advisory and healthcare management. The Firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.