Weekly Digest–May 17th 2024-Proactive Planning Works in Your Garden 🗓️🪴🌼and in Your Office 🏢

Mother’s day weekend did not disappoint.  Early Saturday morning my friend Edith and I took our annual trip to the Brooklyn Terminal Market for flower and vegetable plant🌼🪴shopping; then stopped in the huge Caribbean supermarket on site where we shopped their amazing spices, rice, flour and grains sold by the pound from large barrels.  At home we prepped the soil and then relaxed for the rest of the weekend…

Annual Trip to Brooklyn Terminal Market
Annual Trip to Brooklyn Terminal Market

Sometimes my inspiration comes from my complaining, just last night as I spoke with a friend about the crazy weather this past week. The Northern Lights some of us experienced first-hand Friday evening were certainly cool…

Northern Lights Asheville NC
Northern Lights Asheville NC
Northern Lights Portage MI
Northern Lights Portage MI

Last night my tide app showed that sunrise today was at 5:37 AM; my weather app forecasted a sunny day.  I set my alarm for 5 to make sure I caught a good sunrise on the beach. At least I was able to walk in 60-degree lite drizzle and surprise surprise I was the only one out on the beach…

Another Overcast Day at the Beach ⛱️
Another Overcast Day at the Beach ⛱️

My friend’s husband is visiting friends in San Antonio Tx, he caught today’s sunrise and shared…

Sunrise this Morning in San Antonio TX
Sunrise this Morning in San Antonio TX

I did catch the sun a few days this week…

Saturday Morning Beach Day ⛱️
Saturday Morning Beach Day ⛱️
Monday at Sunrise on Rockaway Beach
Monday at Sunrise on Rockaway Beach

All this rain has been great for the garden I might just have enough lettuce for a bowl of salad tomorrow…

Planted Garden May 2024
Planted Garden May 2024

I am hoping your can take time this weekend to enjoy this moderate weather and let’s hope my weather app is correct and we do get a sunny day on Sunday.

WEEKLY TAKE AWAY

This week I was excited to perform my first “public” duties as Co-President of the Educational Foundation of the Nassau/Suffolk Chapter of NCCPAP at an in-person seminar on Cyber Security.  Yes, I volunteered for this repeat performance as I really do enjoy supporting our professional organization.  I do feel many times I get more than I give from planning and attending meetings with and learning from my professional friends and am happy to do so.  As a “fast talker” I was able to announce the amazing line-up of programs we have scheduled for our members.

Cyber Security Seminar
Cyber Security Seminar

The panel was great and we loved the stories of “white-collar crime” as retold by the speakers from the secret service, here are some takeaways:

  • Common sense but be aware: DO NOT OPEN EMAILS from those people who are asking for help, we tax professional get unsolicited requests from individuals asking us to do their tax returns. You can preview these emails, but if you open them the sender will know and they can continue targeting you/us with additional emails and maybe they will be more aggressive
  • When making purchases at a gas station, grocery store or retail shop use your credit card by tapping or inserting the chip,  don’t swipe; this will thwart “skimmers”, also note it is safer to use a credit card rather than your bank card as you can contest the charge.
  • We have heard of checks being stollen from the mail (even from the mailbox right outside the post office) and then bleached and re-written.  The Uniball Signo 207 gel pen is purported to be non-bleachable.  If your check is stollen this ink cannot be washed off and the check altered for the payee and payment amount.

Thank you for gifting me this pen, much appreciated…

  • Uniball Signo 207 Gel Pen
    Uniball Signo 207 Gel Pen

TAX ISSUES/TAX PLANNING

The IRS Adjusted Health Savings Account Amounts for 2025

The Health Savings Account (HSA) amounts for 2024 are $4,150 ($8,300 for families), up from $3,850 in 2023 and they are scheduled to increase again for 2025 to $4,300 ($8,550 for families).

These plans can enable you to pay for eligible medical expenses with pre-tax dollars; check in with your HR department to see if your company offers an HSA plan.

Copied & Pasted from IRS Publication 969 Health Savings Accounts and Other Tax-Favored Health Plans  at only 23 pages of small print can fill in the blanks for you.

“Benefits of a HSA:

  • You can claim a tax deduction for contributions you, or someone other than your employer, make to your HSA even if you don’t itemize your deductions on Schedule A (Form 1040).
  • Contributions to your HSA made by your employer (including contributions made through a cafeteria plan) may be excluded from your gross income.
  • The contributions remain in your account until you use them.
  • The interest or other earnings on the assets in the account are tax free.
  • Distributions may be tax free if you pay qualified medical expenses.
  • An HSA is “portable.” It stays with you if you change employers or leave the work force.

Qualifying for an HSA Contribution; you must meet the following requirements:

  • You are covered under a high deductible health plan (HDHP), on the first day of the month.
  • You have no other health coverage except what is permitted under the specific rules of the law
  • You aren’t enrolled in Medicare.
  • You can’t be claimed as a dependent on someone else’s tax return”

Section 213 of the Code generally allows a deduction for expenses paid during the taxable year for medical care if certain requirements are met. Expenses for medical care under section 213 of the Code also are eligible to be paid or reimbursed under an HSA, FSA, Archer MSA, or HRA. However, if any amount is paid or reimbursed under an HSA, FSA, Archer MSA, or HRA, a taxpayer cannot also deduct the amount as a medical expense on the taxpayer’s federal income tax return.

In general, medical expenses are the costs of diagnosis, cure, mitigation, treatment, or prevention of disease, and for the purpose of affecting any part or function of the body. These expenses include payments for legal medical services rendered by physicians, surgeons, dentists, and other medical practitioners. They include the costs of equipment, supplies, and diagnostic devices needed for these purposes. They also include the costs of medicines and drugs that are prescribed by a physician.

Medical expenses must be primarily to alleviate or prevent a physical or mental disability or illness. They don’t include expenses that are merely beneficial to general health.

This great Q & A from IRS.gov details the what is covered under payments from your HSA.

FOR OUR GRADUATES 🎓

IRS Tax Withholding Estimator for Help Filling Out Your W-4

We usually recommend filing out your withholding documents as single -0- which may help you pay in a sufficient amount of taxes and maybe even get a small refund when you file your tax return.  The IRS encourages taxpayers to use their IRS Tax Withholding Estimator  for withholding taxes from your paycheck in 2024.   Please remember that this is a tool and that you may not be coving your entire tax liability when using it.  We always recommend checking in with your accounting professional and with the company HR department for potential pre-tax benefits offered at work.

ECONOMY

The U.S. Economy’s Soft Landing is Still on Track

According to a recent article in the Havard Business Review:  While there’s been a recent string of disappointing macroeconomic data, in reality, these developments are signs of the U.S. economy’s strengths, not weaknesses. The economic pessimism of the last few years has often been rooted in a misreading of the U.S. consumer,

These 2 Charts Show Just How Little Faith Americans Have in the Economy

In the latest University of Michigan survey:  “US consumers are still gloomy about the state of the economy… the consumer sentiment index dropped a whopping 13% from April, after staying roughly the same since January.  Indicators be damned.”

The Social Security Fix No One is Talking About

According to this article in Reuters.com “What if the traditional wisdom on how to fix Social Security no longer holds?  The trustees who oversee the program issued their annual financial forecast on Monday, predicting that the combined retirement and disability trust fund reserves will be depleted in 2035 – one year later than forecast last year.
Traditional wisdom holds that there are just a few ways to solve the problem: We can raise the payroll taxes that fund the program, cut benefits, or do some combination of two.
But the closer we get to insolvency, benefit reductions cannot be implemented in a way that solves the immediate problem. And a revenue solution gets more challenging – at least, if the goal is to meet Social Security’s legal requirement to forecast solvency over a 75-year period. The payroll tax hikes required at the point of insolvency to meet that goal would be so large that they likely would not be politically feasible.”

How the U.S. Economy Adapted to 5% Interest Rates

According to this article in Axios.com:  “One year ago this month, the Federal Reserve pushed its target interest rate above 5% — a step that seemed sure to cause ripples across the corporate landscape and the global economy. To a surprising degree, though, the world has taken the onset of 5% rates in stride.

After more than a decade of cheap money, the U.S. economy has adjusted to the new era of high borrowing costs — with more business leaders accepting that it could be the new normal.  companies face more expensive borrowing costs — but many locked in longer-term debt during the ultra-low interest rate period that ended in 2022, so they have time to adjust before that debt rolls over.”

Full Employment, Low Inflation and a Virtuous Cycle in the American Economy

According to this article in RSMUS.com:  “Until recently, the idea that the economy could simultaneously have low unemployment and low inflation seemed to be a fantasy. Conventional wisdom, after all, holds that when unemployment is low, businesses need to pay higher wages to attract workers, which pushes up the cost of goods and services and, ultimately, inflation. But that logic has been turned on its head.

  • The American economy over the past nine months has been one of the best in 50 years, with rising real incomes, disinflation and low unemployment.
  • Today, we think that the economy has reached full employment—the maximum level of employment without causing an increase in inflation—and that a virtuous cycle that bolsters productivity and dampens inflation is now possible.
  • Something has changed. It now seems possible to have full employment between 3.5% and 4% and inflation around 2.5% to 3%.
  • Part of the reason has been the Federal Reserve, which has successfully pursued a tough monetary policy over the past two years as it seeks to fulfill its dual mandate of maximum sustainable employment and price stability.

And with unemployment averaging 3.6% over the past two years and inflation still elevated above the Fed’s 2% target, the Fed may consider keeping its policy rate at 5.5%.  ”

GENERAL RESOURCES

We sincerely hope that you and your family are well and remain well. If you have any questions or concerns, don’t hesitate to reach out to us. We are here for you.

If you need help with your accounting, want to create a tax minimization plan, want to discuss your business growth plan or your finances, are concerned about retirement goals or need to be held accountable for your 90 day action plan, contact us for a complimentary discovery session or an appointment to just get started

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