Hidden Benefits in the Sharing Economy

Key Takeaways

  • 34 percent of the workforce is now doing independent, self-employed work—up from 6 percent 20 years ago.
  • The majority of workers in the sharing (gig) economy are NOT taking advantage of all the saving and tax mitigation benefits they’re entitled to.
  • A Solo 401(k)/Profit Sharing Plan can help many sharing economy workers save for retirement and reduce their taxable income.

Cold and Taxed!

Domiciling in Florida or another warmer climate can improve your tax situation and your tan. Just make sure you know the rules well before packing your bags.

Key Takeaways

  • Illinois weather is not kind to residents in winter, and the state of Illinois is not kind to residents who pass away within its borders—at any time of year.
  • If you have property in Florida, Texas, Nevada or other states without a “death tax,” consider making that state your domicile.
  • Many tax-friendly states are in warmer climates, but estate tax rates and the rules about domiciling are complicated. Don’t make a move without seeking expert counsel first.

The Social Security Jig Is Up!

Gary Klaben and John Dragstrem discuss important changes to Social Security you can’t afford to ignore

Key Takeaways

  • New legislation will soon put an end to the popular “file and suspend” and “restricted application” strategies for maximizing your Social Security benefits.
  • After April 30, 2016, you can still collect, delay and reap retirement credits. But the benefits to the spouses, once you suspend, will no longer exist.
  • If you’re at least 66 and have not filed for Social Security benefits, you have about 5 more months to take advantage of the file-and-suspend feature within Social Security.
  • Social Security Graphic

Longing for Income

Key Takeaways

  • A Qualified Longevity Annuity Contract (QLAC) is a new tool allowing retirees to defer income—and mandatory distributions—until much later in life than standard IRAs or 401(k)s allow.
  • QLACs pay off if you live for a long time—i.e., longer than the insurance company actuarial tables predict you will.
  • Just remember, QLACs are irrevocable and not very flexible, and returns can be modest.