Sweeping Changes to Retirement Planning
Sweeping 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 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.
Cavanagh, 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.”
The 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 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.
Three Ways to Lower Your 2018 Taxes
As you race to get all your shopping, wrapping and baking done in time for the holidays, you may want to set aside some time to think about your tax return. Some action now could wind up saving hundreds or maybe even thousands of dollars when you go to file your tax return next spring. Gilmore Jasion Mahler Tax Partner Charlie Heid shared some suggestions on WTOL-11, including three ways to lower your taxes before the end of the year.
#1: Bunch or bundle your charitable contributions
With the new higher standard deduction, which is now $12,000 for individuals and $24,000 for joint filers, smaller charitable donations will no longer get you that tax break that they used to. Many more people will now be taking the standard deduction, and itemizing their deductions won’t apply.
You don’t have to stop giving to charity, just change up your timing a bit. For example, rather than donating $15,000 a year, bump that up to $30,000, but do it every other year instead.
#2: Finalize the divorce
Another change that the new tax law brought will affect anyone going through a divorce right now.
The big impact will be for the person who will be paying the alimony once the marriage is over.
If you’re in the process of a divorce and still finalizing the agreement, be aware that December 31, 2018 is a critical deadline… if you finalize the divorce before the 31st any alimony paid can still be deducted, and alimony received is still considered taxable income. After December 31, that alimony paid will no longer be deductible, nor will it be taxable for the recipient of the alimony. So if you’re in the process of a divorce, and you’re the one who will pay alimony, you want to get it finalized before the end of the year.
#3: Feed the 401k
You can protect a good portion of your income from taxes by moving it into a 401k. You won’t pay tax on the money until it is withdrawn during your retirement. You’re allowed to contribute up to $18,500 to your 401k this year. If you’re over 50, you can contribute up to $24,500.
If you don’t have a 401k you can put the money into an IRA. The great news with the IRA is that you have up until April 15th of 2019 to move the money to that IRA and still have it count as a 2018 contribution.
One final thought: If you sold any investments this year and made money, you may be looking at paying capital gains tax… you could take a look at any of your holdings that show a loss and sell them to offset the gains. If you have more losses than gains, you might be able to deduct the difference, up to $3,000 per year.
Tax Partner Charlie Heid contributed this blog. He joined Gilmore Jasion Mahler in 2002 and brings decades of experience to his clients. Charlie serves individuals as well as business clients across many industries, including manufacturing & distribution, retail and construction. He shares timely information on tax and money issues monthly on WTOL's Your Day.
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 outsourced 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.
Act Soon To Take Advantage of New Business Tax Credit
Your business could qualify for a new tax credit created when the Tax Cuts and Jobs Act was signed into law at the end of 2017. The Employer Credit for Paid Family and Medical Leave (Section 45S of IRS Code) applies to certain employers who offer paid family and medical leave to their employees. It’s only around for this tax year and next (at least for now), so take advantage of it while you can.
Does your business qualify?
There are certain requirements in place for businesses interested in claiming this tax credit, including:
A written policy in place that meets certain requirements including:
- At least 2 weeks paid family and medical leave a year to all qualifying full time employees (prorated for part time employees)
- The paid leave can’t be less than 50% of the wages normally paid to the employee
Which employees qualify?
- Employed for a year or more
- For 2018 credit: employee can’t have made more than $72,000 from the employer
What qualifies for family and medical leave in order to qualify for the tax credit?
- Birth of a child/care for the child
- Adoption or foster care placement
- Care for spouse, child, parent with serious health condition
- Serious health condition making employee unable to perform his/her job
- Family member or employee called to active duty
- Care for a service member who is a spouse, child, a parent, next of kin
Evaluate your company policies regarding the Family Medical Leave Act (FMLA). You still have time to create a company policy regarding family medical leave. You can also change your existing policy or include additional policies to fill in the gaps needed in order to qualify for and take advantage of the tax credit for 2018. The credit will apply retroactively for family/medical leave already taken in 2018 by qualifying employees. The policy just needs to be in place by and have an effective date of December 31, 2018.
We’ve already spoken to some clients about this tax credit, and expect more conversations in the weeks to come. Now’s the time to figure this out with your tax advisor so you’re not up against the deadline and can actually enjoy ringing in the New Year.
Jessica Nunn contributed this blog. Jessica is a manager in the tax department with nearly 10 years of public accounting experience at Gilmore Jasion Mahler, LTD. She specializes in for-profit entities, with a concentration in manufacturing & distribution.
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.