With Labor Day behind us, there is less than 1/3 of 2010 left. Everyone's list will be a bit different, but let me suggest a few things that you might put on your financial to do list for the remainder of 2010.
For the self employed a couple of items. First, if your tax return is on extension, you still have time to make a contribution to a SEP-IRA for 2009. If you file a corporate return, your deadline is September 15, if you are a sole proprietor the deadline is October 15. You can either contribute to an existing account or open a new SEP.
For 2010 consider a Solo 401(k) . Contributions to the 401(k) must be made by December 31. This is also the deadline for starting a Solo 401(k) for the current year. Additional profit sharing contributions for 2010 must be made by the date you file your tax return, including extensions. The maximum combined contribution is $49,000 ($54,000 if you are 50 or over).
Roth IRA conversions have received a lot of press. I'm not an overwhelming fan of doing this, but if you are considering a conversion you should at least take a hard look at potential benefits for your situation before the end of the year. New rules for 2010 and beyond removed the income ceiling on the ability to do a conversion. Further, for conversions completed before the end of the 2010 you are allowed to spread the payment of any income tax due over 2011 and 2012.
Before the end of any year it is always a good idea to review your taxable investment portfolio for any taxable losses. Often it is a good idea to realize some or all of these losses. Losses can be offset against any capital gains including those that arise from distributions from mutual funds and ETFs. To the extent that realized losses exceed gains you can deduct $3,000 and carry the rest over to future years. If you still want to own the security that you are selling you need to be aware of the Wash Sale rules that spell out the time frame in which you need to be out of that investment. I suggest that you consult a financial or tax professional on this issue.
401(k) sponsors this is a good time to take a look at your company's plan. New disclosure rules for plan expenses come on line in 2011. If you don't use one already why not hire an independent advisor to fully review your current plan and ensure that your plan is well run with solid funds and low expenses making the plan a real benefit to your employees.
For those of you who are corporate employees, this year especially pay close attention to the materials that you receive from your company during fall benefits open enrollment. I know of a number of companies making some benefit changes in light of the new Healthcare Legislation. Your benefit package is a significant portion of your compensation, make sure that you are taking full advantage of what is offered to you and that your elections reflect your family's needs.
Speaking of company benefits, make sure that your 401(k) plan allocation fits with your overall financial plan. Be cognizant of any changes in the investment menu. If you can afford it try to increase your contribution level each year if you are not at the maximum.
Maybe I'm paranoid, but I like to suggest that clients review their beneficiary designations on insurance policies, annuities, retirement plans, IRAs, etc. every year to ensure that they are correct and reflect your current wishes. Always better to be safe vs. sorry here, these elections rule in the event of your death even if they don't reflect your wishes.
This list is not meant to be exhaustive. What is on your financial to do list for the rest of 2010?
As always, please feel free to contact me if I can help with these or any related issues.
No comments:
Post a Comment