Changes Are Coming to Your 401(k) Statements

Changes Are Coming to Your 401(k) Statements

A new information policy will soon impact your 401(k) statements, thanks to the Secure Act, which was passed in 2019. The legislation requires special disclosures be added to your quarterly statements issued after June 30.

In addition to the basic information about your investments and the size of your savings, you’ll now also see “lifetime income illustrations.” This information is meant to help you gain a “big picture” view of how long your nest egg may last when you retire. This will be illustrated by showing approximately how much income you would receive each month for the rest of your life if you were to buy an annuity with your current 401(k) savings at age 67.

There will be two examples shown on your statement:

  • A “single life” annuity, which pays income to an individual buyer for life.
  • A “qualified joint and survivor” annuity, which pays income for an individual and a surviving spouse for life.

Keep in mind that the estimates:

  • Are based on your current 401(k) balance.
  • Don’t include projections on how your savings may grow and affect your future nest egg.
  • Don’t account for Social Security or other retirement savings.
  • Assume your full balance will be fully “vested.”

Start Saving More Now

If you’re getting close to retirement age, the new disclosures will give you a clearer picture of your current financial situation. If retirement is still a ways off, however, the estimates will give you a better idea of how much more you should start saving now — while you still have time.

For example, you can better formulate a retirement plan now if you know how much you will have to spend when the time comes. Seeing it on your statement might inspire you to increase your 401(k) contribution — especially if your employer offers a 401(k) match that you haven’t maxed out yet.

Be sure to check with your plan administrator to see if they offer online resources that can help you determine your future income needs. Organizations like AARP and the American Institute of Certified Public Accountants also offer free online retirement calculators.

Did You Know?

Google offers digital training courses and tools to help your small business adapt, grow and better serve your community. Visit Grow With Google for information on improving your online presence, including:

  • Setting up an online business
  • Getting listed on search & maps
  • Using YouTube to grow your business
  • Learning about Google tools
  • And more

Mid-Year Mileage Rate Increase

Due to rising fuel costs, the IRS is increasing the standard mileage rates for the rest of the year. Beginning July 1, the new business mileage rate will be 62.5 cents per mile, up 4 cents from the current rate. The new rate for deductible medical or moving expenses (available for active-duty members of the military) will be 22 cents, up 4 cents. The 14 cents per mile rate for charitable organizations remains unchanged.

Enhanced Business Meal Deduction Still Available

Don’t forget that, through the end of the year, you can continue to take advantage of the enhanced business meal deduction. For 2021 and 2022 only, businesses can generally deduct the full cost of business-related food and beverages purchased from a restaurant. Otherwise, the limit is usually 50% of the cost of the meal.

To qualify:

  • A business owner or employee must be present when food or beverages are provided.
  • Meals must be from restaurants (i.e., businesses that prepare and sell food or beverages to retail customers for immediate on-premises or off-premises consumption).
  • Payment or billing for the food and beverages (including taxes & tips) must occur before January 1, 2023.
  • The cost of food and beverages must be billed separately from any entertainment
  • The expense cannot be lavish or extravagant.
Retirement and Taxes: Understanding Your IRA

Retirement and Taxes: Understanding Your IRA

Retirement may be closer than you think — especially if you’re saving money now just for that purpose. An Individual Retirement Arrangement (IRA) can be a smart way to save because it provides tax incentives to help you on your path. And IRAs are easy to set up with a bank or other financial institution, a life insurance company, a mutual fund or a stockbroker.

What You Need to Know About IRAs

If you have a Traditional IRA, you may be able to deduct your contributions from your taxes. Also, the interest and dividends earned in a Traditional IRA are not taxed until you withdraw them, typically when you’re retired and in a lower tax bracket.

If you have a Roth IRA, you are subject to similar restrictions as with a Traditional IRA. However, you cannot deduct your contributions. But qualified distributions from a Roth IRA are typically tax-free. And Roth IRAs do not require withdrawals until after the death of the owner.

 A SIMPLE (Savings Incentive Match Plan for Employees) IRA or SEP (Simplified Employee Pension ) IRA can be set up for employees and employers to make contributions. These are often popular with smaller businesses. Ask your employer if one is available.

A CONTRIBUTION is the money that you put into your IRA. There are annual limits to the amount you can contribute depending on your age, income and type of IRA (see below for new 2022 limits).

A DISTRIBUTION is the amount you withdraw from your IRA. Keep in mind that you may face a 10% penalty and a tax bill if you withdraw money from your IRA before you turn 59½, unless you qualify for an exception. There are also required distributions from an IRA — in most cases, you generally must start taking withdrawals when you reach age 70½.

If you have one or more IRAs, you’ll need to let us know how much you contributed and/or withdrew during the year when we file your taxes next spring. Be sure to keep all the important paperwork related to your accounts. If you have any questions, we’ll be happy to help — just contact us here.

Retirement Plan Limits Increase for 2022

Due to cost-of-living adjustments, retirement plan contributions are increasing for tax year 2022. For example, the amount you can contribute to your 401(k) plan for 2022 will increase to $20,500, up from $19,500 for 2020 and 2021. This also includes 403(b), most 457 plans, and the federal government’s Thrift Savings Plan. The amount you can contribute to a SIMPLE retirement account increased to $14,000, up from $13,500.

The income phase-out ranges for deductible Traditional IRA contributions are increasing for 2022:

  • For single taxpayers covered by a workplace retirement plan, the phase-out range increases to $68,000-$78,000, up from $66,000-$76,000.
  • For married couples filing jointly, if the spouse making the IRA contribution is covered by a workplace retirement plan, to $109,000-$129,000, up from $105,000-$125,000.
  • For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, to $204,000-$214,000, up from $198,000-$208,000.
  • For a married individual filing a separate return who is covered by a workplace retirement plan, it remains $0-$10,000.

The income phase-out range for Roth IRA contributions is increasing:

  • For singles and heads of household, to $129,000-$144,000 up from $125,000-$140,000.
  • For married couples filing jointly, to $204,000-$214,000, up from $198,000-$208,000.
  • For a married individual filing a separate return, it remains $0-$10,000.

The income limit for the Saver’s Credit (Retirement Savings Contributions Credit) for low- and moderate-income workers is increasing:

  • To $68,000 for married couples filing jointly (up from $66,000).
  • To $51,000 for heads of household (up from $49,500).
  • To $34,000 for singles and married individuals filing separately (up from $33,000).

Know Your Contribution Limits

The limit on the amount you can contribute annually to your IRA remains unchanged at $6,000. The IRA catch-up contribution limit for those age 50+ also remains at $1,000. The catch-up contribution limit for employees age 50+ for 401(k), 403(b), most 457 plans, and the Thrift Savings Plan remains unchanged at $6,500. Therefore, those 50+ can contribute up to $27,000 starting in 2022. The catch-up contribution limit for employees age 50+ and for SIMPLE plans also remains unchanged at $3,000.

Are You Eligible for the ODC?

The Credit for Other Dependents (ODC) is a tax credit for qualifying dependents who can’t be claimed for the Child Tax Credit. The maximum credit amount is $500 for dependents who meet these conditions:

  • Age 17 or older.
  • Have individual taxpayer identification numbers or Social Security numbers.
  • Are dependent parents or other qualifying relatives you support.
  • Are living with you but are not related to you.

You can claim this credit if:

  • You claim the person as a dependent on your tax return.
  • You cannot use the dependent to claim the Child Tax Credit or Additional Child Tax Credit.
  • The dependent is a U.S. citizen, national or resident alien.

You can claim the Credit for Other Dependents in addition to the Child and Dependent Care Credit and the Earned Income Credit. Note that the credit begins to phase out, however, when your income is more than $200,000 ($400,000 for married filing jointly).

Let us know if you support other dependents in your household, and we’ll help you determine which credits apply on your next tax return.

IRS Video Tax Tip

If you have taxable income from any payer that doesn’t withhold tax for you, check out this IRS video to see if you need to make estimated tax payments.

Retirement Planning: Are Your Social Security Benefits Taxable?

Retirement Planning: Are Your Social Security Benefits Taxable?

If you are retired now or planning on retiring soon, you’ll need to determine if any of your Social Security benefits will be taxed. It’s an important part of figuring your income and expenses during this time of your life.

Since 1984, Social Security beneficiaries with total incomes exceeding certain thresholds have been required to pay federal income tax on some of their benefit income. And because those income thresholds have remained unchanged while wages have increased, the proportion of beneficiaries who pay income tax has risen over time. On average, more than half of beneficiaries typically owe federal income tax on part of their Social Security benefits.

Will You Have to Pay?

Here’s how to determine if your Social Security benefits are taxable:

Add one-half of your (and your spouse’s, if married) Social Security income to all your other income, including pensions, wages, interest, dividends and capital gains.

  • If you’re single and your total added-up income equals more than $25,000, then part of your Social Security benefits may be taxable.
  • If you’re married filing jointly and your total income equals more than $32,000, then part of your Social Security benefits may be taxable.

Up to 50% of your benefits may be taxable if you are:

  • Filing single, head of household, or qualifying widow or widower with $25,000 to $34,000 income.
  • Married filing separately and lived apart from your spouse with $25,000 to $34,000 income.
  • Married filing jointly with $32,000 to $44,000 income.

Up to 85% of your benefits may be taxable if you are:

  • Filing single, head of household, or qualifying widow or widower with more than $34,000 income.
  • Married filing jointly with more than $44,000 income.
  • Married filing separately and lived apart from your spouse with more than $34,000 income.
  • Married filing separately and lived with your spouse at any time during the past year.

If you’re like most, a certain percentage of your monthly retirement, survivor and/or disability benefits is potentially taxable, depending on your income and filing status. Of course, there are a lot of other factors that go into figuring your income (and expenses) during retirement. And all of that information can help you figure out the best time for you to retire.

We’re here to help you make those important calculations — and ensure they’re correct — so you can enjoy your retirement without worrying about how to pay for it. Contact us when you’re ready.

Rollover Relief for RMDs


If you already took a Required Minimum Distribution (RMD) this year from certain types of retirement accounts, you can roll those funds back into your retirement account, thanks to the CARES Act. The 60-day RMD rollover period has been extended to August 31, 2020.

In addition to rollovers, this also applies if you are an IRA owner or beneficiary who has already received an RMD distribution this year. You can repay the distribution to the IRA by August 31, 2020. Further, this repayment is NOT subject to the one rollover per 12-month period limitation and the restriction on rollovers for inherited IRAs.

This relief applies if you had an RMD due in 2020 from a defined-contribution retirement plan, including a 401(k) or 403(b) plan, or an IRA. It also applies if you turned 70½ in 2019 and would have had to take your first RMD by April 1, 2020. Note that the waiver does NOT apply to defined-benefit plans.

If you have any questions about this RMD relief, please don’t hesitate to contact us.



The PPP loan deadline has been extended to August 8, 2020, after being signed by President Trump on Saturday. This 5-week extension re-opens the application window for the Paycheck Protection Program (PPP), keeping open a source of funding for struggling small businesses while Congress works on a second, more targeted funding program. The SBA had stopped accepting loan applications on June 30 before the extension was approved. As of June 30, the SBA had approved more than $520 billion in PPP funding, with approximately $129 billion in funds remaining available.


If you received an Economic Impact Payment, you should keep Notice 1444, Your Economic Impact Payment, with your tax records.

Notice 1444 provides details about the amount of your payment, how the payment was made and how to report any payment that wasn’t received. The IRS mailed this notice to your last known address within 15 days after sending the EIP. It’s especially important to keep this notice if you think your payment amount is wrong.

When you file your 2020 tax return, we’ll use your Notice 1444 to claim any additional credits, if you are eligible for them. Keep this notice on hand with your other important tax records, including W-2s, 1099s, and other income documents and records. Remember, you should be keeping copies of your past tax returns and supporting documents for at least three years.

Retirement Plan Update: Important Changes to RMD Rules for 2020

Retirement Plan Update: Important Changes to RMD Rules for 2020

If you have an IRA or other qualified retirement plan and you are 70+, you’ll want to know about a special rule change made in response to the COVID-19 pandemic. Under the Coronavirus Aid, Relief and Economic Security (CARES) Act enacted in March, you will not have to take a Required Minimum Distribution (RMD) from your retirement account for 2020.

As a reminder, RMDs are the required withdrawal you must take from your qualified retirement plan (IRA, SIMPLE IRA or SEP IRA) each year after you reach age 70½. Note that Roth IRAs do not require withdrawals until after the death of the owner.

If you have an employer-sponsored retirement plan [e.g., defined contribution, defined benefit, 403(b) or governmental 457(b) plan], you must also begin RMDs in the year in which you reach age 70½ or the year you retire, whichever is later.

How the RMD Waiver Works

For 2020 only, Required Minimum Distributions are waived for all employer-sponsored retirement plans and IRAs, including inherited accounts. The only type of plan that the rule change does not apply to is an employer-sponsored defined-benefit plan (e.g., a traditional “pension” type plan). Here’s how the new rules work:

  • The waiver applies to RMDs due in 2020, but attributable to 2019. (If your first RMD year was 2019, and you took the RMD beforeFebruary 1, 2020, the 2020 RMD waiver does NOT apply. However, if you took the RMD between February 1 and May 15, 2020, you CAN take advantage of the 2020 RMD waiver.)
  • You do not need to meet any COVID-19 “qualifying criteria” to waive RMDs for 2020.
  • If you do not take an RMD in 2020, you will NOT be required to take two RMDs in 2021.

If you have already taken your RMD, you have the opportunity to roll it back into a retirement account should you want to. For distributions taken between Feb. 1 and May 15, 2020, the following rules apply:

  • Distributions must be rolled back into a retirement account by July 15, 2020.
  • For IRA-to-IRA rollovers, only one rollover is allowed per 12 months beginning from the day the distribution is received.
  • You can only roll over the same assets that were distributed. So, if 10 shares of XYZ company are distributed, you can only roll over up to 10 shares of XYZ company. If $5,000 in cash is distributed, you can only roll over up to $5,000 in cash.
  • Inherited and successor IRAs are not eligible to receive an IRA-to-IRA rollover; however, a spouse beneficiary can roll the assets into an IRA in their own name if the rules above are met.

Questions? We Have Answers!

With all that’s happening these days, these rules may very well change again. But for now, if you’re unsure about your RMD situation, contact us. We can help make sure the rules are followed so you are not penalized.

Stimulus Payment Update

Approximately 130 million people have received Economic Impact Payments (EIP) worth more than $200 billion in the program’s first four weeks. In Georgia alone, more than 4 million people have received nearly $7 billion in payments. The IRS has been sending out new batches of stimulus benefits every week, and is urging people to use Get My Payment by noon Wednesday, May 13, for a chance to get quicker delivery. You can check the status of your payment here.

Georgia Ranks as the #9 Lowest-Cost State to Retire

Georgia Ranks as the #9 Lowest-Cost State to Retire

According to a recent study by GOBankingRates, Georgia ranks as one of the best states to retire if you’re trying to stretch your nest egg.

If you have $100,000 saved, for example, you can expect to live off that for 877 days in Georgia (roughly 2-1/2 years). The study considered the average total expenditures for people aged 65 and over, as well as the cost of living index in each state.

The cheapest state to retire is Mississippi (946 days), while the most expensive is Hawaii (428 days). The national average is 780 days, which equates to nearly $48,000 in annual expenditures.

Are You Ready to Retire?

Retiring in Georgia can be a good choice if your retirement savings are less than you’d like. More than half of American workers (52%) say they’re behind where they should be in saving for retirement, according to a study by Just 16% say they are right on track, and 11% feel they are ahead of where they should be in terms of saving. Another 20% of respondents say they don’t know if they’re on track or not. And a full 38% say they have never had a retirement account at all!

“Getting your retirement savings on track begins by fully utilizing your tax-advantaged retirement savings options, such as a workplace 401(k) and supplementing that with an IRA,” said Bankrate’s chief financial analyst, Greg McBride, CFA. “Aim to save at least 10% — and ideally 15% — of your income specifically for retirement. The best time to start is ‘today,’ and the worst time to start is ‘someday.’”

The tendency to be behind on retirement savings is highest among households with an annual income between $30,000-$49,999, with 62% responding that they are behind where they should be. That figure falls to 52% for households earning an income under $30,000 per year, and 48% for households with incomes of $80,000 or more.

We Can Help

No matter where you are in your retirement savings timeline, we can help you get started — or keep going — so you can retire wherever you want to and not worry about your savings running out. Call us today!

Sources: Yahoo! Money, GO BankingRates, BankRate

The information provided here by Premier CPA Services PC is for general information only. It does not constitute legal, accounting, tax or other professional advice or services, and is presented without any representation or warranty as to the accuracy or completeness of the information. Please contact us for information as it relates to your circumstances.
New Tax Changes May Affect Your Retirement Savings

New Tax Changes May Affect Your Retirement Savings

President Trump signed into law in December a bill to keep the federal government funded. As part of that bill, several new tax changes were enacted, include some major changes to retirement plan rules.

The new “SECURE” Act is designed to encourage retirement savings and to simplify administrative requirements for small businesses. For the most part, these are positive changes and good news if you’re saving for retirement. Some of the key changes include:

  • Increasing the age after which required minimum distributions from certain retirement accounts must begin from age 70½ to age 72.
  • Repealing the maximum age for IRA contributions, which was formerly 70½.
  • Allowing penalty-free distributions from qualified retirement plans and IRAs to help pay for births and adoptions.
  • Allowing qualified home healthcare workers to contribute to a defined contribution plan or IRA.
  • Making it easier for long-term, part-time employees to participate in elective deferrals.
  • Making it easier for small businesses to offer multi-employer plans by allowing otherwise completely unrelated employers to join in the same plan.

One change that could create some substantial tax consequence is the requirement that non-spouse beneficiaries of IRAs and qualified retirement plans withdraw all money from inherited accounts within 10 years. This rule takes effect for accounts inherited after January 1, 2020.

Other Tax Changes Made

In addition to the retirement plan adjustments noted above, the new law also:

  • Allows certain expenses associated with registered apprenticeship programs to count as qualified higher education expenses for 529 accounts.
  • Repeals the excise tax on certain high-cost employer health plans (the Cadillac tax), the medical device excise tax and the annual fee on health insurance providers — all of which were part of the Patient Protection and Affordable Care Act, but had been postponed or suspended.
  • Extends several expired tax provisions, including those relating to the discharge of qualified principal residence indebtedness income; the treatment of mortgage insurance premiums as qualified residence interest; the continuance of the 7.5% (instead of 10%) adjusted-gross-income floor for medical expense deductions; and an above-the-line deduction for qualified tuition and related expenses.
  • Extends through 2020 several tax credits that were scheduled to expire, including a new markets tax credit, an employer credit for paid family and medical leave, the work opportunity credit, and the credit for health insurance costs of eligible individuals.
  • Provides tax relief for victims of various disasters occurring in 2018, 2019, and through January 19, 2020.

Give Us a Call: 706-632-7850

To take full advantage of the changes under this recent legislation, schedule an appointment to come in and talk with Jackie or Donna. We can review your personal situation and provide guidance for some smart financial moves.

We’re also booking appointments for tax filing beginning in January, so call us if you’re ready to get started!

(Source: Journal of Accountancy)

Important & Interesting Dates to Note for 2020

JAN 15: 4th Quarter Estimated Tax Payments due for 2019

JAN 31: Final date for employers to send W-2 and 1099 forms

FEB 2: Super Bowl LIV (Miami)

FEB 29: Leap Day

MAR 8: Daylight Savings Time begins

MAR 24: Georgia Presidential Primary

APR 1: Census Day (By this date, every home will receive an invitation to participate in the 2020 Census)

APR 15: Tax Day

APR 22: Earth Day 50th Anniversary

JUL 24-AUG 9: Summer Olympics (Tokyo)

OCT 15: Tax Filing Extension Deadline

NOV 1: Daylight Savings Time ends

NOV 3: Election Day

The information provided here by Premier CPA Services PC is for general information only. It does not constitute legal, accounting, tax or other professional advice or services, and is presented without any representation or warranty as to the accuracy or completeness of the information. Please contact us for information as it relates to your circumstances.
Georgia Loves Its Retirees!

Georgia Loves Its Retirees!

The Peach State is among the top 10 tax-friendly states for retirees, as ranked by Kiplinger in 2017. Social Security income is exempt from Georgia state taxes, as is up to $35,000 of most types of retirement income for anyone age 62 to 64. When you hit 65, the exemption rises to $65,000 per taxpayer.

Eligible retirement income includes pensions and annuities, interest, dividends, net income from rental property, capital gains, royalties, pensions, annuities and the first $4,000 of wages and other earned income. Many Georgia seniors can also claim property tax exemptions above and beyond normal homestead exemptions.

Social Security Tax-Smarts

Just because Social Security benefits aren’t taxed at the state level in Georgia doesn’t mean you’re off the hook. Uncle Sam is probably going to want a bite, and the amount subject to taxes will be calculated on a sliding scale based on your income.

Coordination Is Everything

Because the tax rules focus so much on income, it’s important to coordinate when you start taking Social Security benefits. You’ll want to weigh when to take benefits with when you expect to receive income from other sources.

For example, you might be tempted to start taking benefits as early as possible — even if you’re still working. The gotcha here is that the wage income you’re earning in that paycheck can easily bump you over the income thresholds at which your benefits will become taxable. Even worse, you’re likely to be in a higher tax bracket because you’re still working, so the tax hit will be a double whammy. Waiting to claim benefits until after you’ve quit working may be smarter, but it really all depends on your financial situation.

One Size Does Not Fit All

The best retirement income strategy varies based on your individual circumstances, so it’s impossible to give one-size-fits-all advice. But we can help you think through your situation — including how to navigate the Social Security taxation rules and how to reduce the amount you have to pay to Uncle Sam. Just call the office to make an appointment today.


Visit SSA.Gov
You can get a good estimate of your future Social Security benefits by looking at your most recent Social Security statement. To check it online, you’ll just need to create an account at There’s a ton of valuable information here in addition to benefit estimates.

Social Security Fast Facts

Did you know …

  • President Franklin D. Roosevelt signed the Social Security Act into law on August 14, 1935.
  • Ida M. Fuller, a retired legal secretary in Vermont, was the first person to collect Social Security; her check, paid on January 1, 1940, was for $22.54.
  • As of December 31, 2018, about 176 million people were paying Social Security taxes, and about 63 million were receiving monthly Social Security benefits.
  • To qualify for Social Security retirement benefits, you must be at least 62 and have paid into the system for 10+ years.
  • The longer you wait to collect Social Security (up to age 70), the higher the monthly benefit you’ll receive.
  • Your spouse and/or ex-spouse may be eligible for benefits based on your earnings record.
  • Social Security may provide benefits to your spouse and younger children in the event of your death.
  • If you can’t work due to a long-term disability, you may be eligible for Social Security disability benefits.