Month: May 2016

Watch those Medicare Part B & Part D (Prescription Drug Coverage) Premiums: You May be Paying Higher Premiums than you Should!

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Sharkey_Howes_Javer_Glasses_Monthly_Adjusted_BlogFor our seniors 65+ and those caring for seniors…

Did you know that if your income has dropped significantly you may be eligible for a reduction of your Medicare Part B & and Part D (Prescription Drug Coverage) premiums?

If you’ve ever received a letter from Social Security telling you that your income level causes you to pay extra premiums on your Medicare Part B and Part D, then you should be aware of these rules.

The Social Security Administration receives data that is two-years old, specifically your Modified Adjusted Gross Income (MAGI), each year from the Internal Revenue Service (IRS) and uses this information to determine the amount of your monthly premiums. If your income has dropped below specific thresholds, your premiums will decrease and vice versa. See the chart below for a breakdown of income levels and premiums required in 2016.

SHJ Tax Return Comparison Chart(source)

The important thing to note is that you don’t have to wait for two years for Social Security to get updated information from the IRS. Instead, if you know your MAGI has dropped below the income threshold on which your current premiums are based, then you can file an appeal along with some required documentation of your current MAGI and request a review.

Required documentation is:

  • A copy of your filed tax return and an IRS transcript;
  • A letter or statement from the IRS stating they have corrected your tax information and explaining the correction;
  • Your amended tax return, along with a letter from the IRS accepting your amended return or an IRS transcript; Your copy of your tax return that shows an obvious IRS transcription error in tax-exempt interest income; or
  • Your declaration under penalty of perjury that you lived apart from your spouse for the entire year when you filed your income tax return as “married Filing separately”. (source)

If the Social Security Administration finds that you’ve been paying a higher premium than you should have been, then they will refund the excess within 30 days of notifying you of their findings. So don’t wait, keep an eye on your income level and if you’re due a reduced premium, get filing!

For additional information read publications, Medicare Premiums: rules for Higher-Income Beneficiaries (SSA Publication No. 05-10536) and Medicare Premiums: What You Can Do If you Think Your Income-Related Premium Is Incorrect (SSA Publication No. 05-10125).

Inside the Economy with SH&J: May 23, 2016

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As we transition into summertime, the news is slowing and the economic committee reviews macroeconomic trends including a look at the Federal debt level and increased subprime lending (mostly in auto loans) as well as China’s continued investment in U.S. real estate. Additionally, hear what information about Saudi Arabia has been kept a secret for more than four decades and how much of the focus around the world is on treasuries and confidence. Post your questions below and we will answer them during our next Inside the Economy with SH&J in two weeks!

Behind the Scenes: What the SH&J Team Has Been Reading

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Did you know many members of our team are avid readers? Whether it is a good story or a book to help us improve as planners, you will often find our noses in a book during our downtime. Today we thought we would share our latest book reviews with you. We’d love to hear what you’ve been reading as well in the comments below!

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Inside the Economy with SH&J: May 9, 2016

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While our last discussion highlighted segments of the U.S. economy, this week’s discussion highlights segments of China’s economy. Gain insight on China’s debt bubble and the potential effect (or lack thereof) on the U.S. consumer, as well as a comparison of Corporate China today to Corporate America in 2005. This discussion also addresses the latest on U.S. consumer debt, auto sales and the labor markets. Listen in to hear about these issues and more, including updates on the U.S. energy bankruptcies.

Fee-Only Advisors: What are you actually paying for?

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Financial consultant reviewing statistical graphs and charts

Oftentimes, making financial decisions can be overwhelming and emotional. In a world inundated with information via the internet, it can be hard to make heads or tails of it all. Working with a financial advisor can provide direction and peace of mind when making decisions, but how do you find a relationship that you can trust?

A good place to start is asking how the advisor is compensated. Working with a fee-only advisor can largely impact the services you receive. A fee-only advisor is paid by the client for the advice they give, not by product sales or commissions. This fee is typically on a project, hourly or retainer basis, or a percentage of assets under management. Be careful not to confuse fee-only with fee-based, which can include a client fee and commission component. Continue reading →