Tax Season is Here and So are We

April 17 will be here soon. As you prepare your 2017 taxes, we would like to remind you of some possible tax-saving considerations:

Health Savings Accounts (HSA) Tax preparation

If you are covered under a High Deductible Health Plan for your medical insurance, you may be able to make a tax deductible contribution to an HSA. You have until April 17, 2018 to contribute to an HSA for 2017. The money remains in your account and may be used to pay for any qualified expenses in the future and/or invested*.

Contribution limits for 2017 are:

  • $3,400 for single
  • $6,750 for family
  • $1,000 additional catch-up contribution for age 55 and older

Individual Retirement Accounts (IRA)

If eligible, you can make a deductible contribution to an IRA by April 17, 2018. Contributions are limited to $5,500 if under age 50 and $6,500 if over age 50.

If you are self-employed, consider making contributions to the following:

  • SIMPLE IRA or Safe Harbor 401k – These plans need to be established by October 1 of the preceding year. Contributions must be made by either April 17, 2018, or by October 15, 2018 if there is an extension.
  • SEP IRA – The plan must be established by and the employer contributions made by April 17, 2018, or October 15, 2018 with an extension.

SC Future Scholar 529 Plan

2017 contributions to the SC Future Scholar 529 plan may be made until April 17, 2018 and may be used by state residents to lower SC taxable income. A state income tax deduction of up to 100% of contributions (including rollovers) to a Future Scholar 529 plan is available for South Carolina tax payers.

Your team at NNP is ready to help during tax season. We are happy to work with your tax advisor to determine the viability of any of these strategies. Give us a call at (864) 467-9800.

*minimums might be required.

Putting Clients First

Department of LaborThe Department of Labor (DOL) Fiduciary Rule became effective on June 9, 2017. This rule requires financial firms to act in the best interest of clients when making recommendations in regards to retirement accounts.

As a recent article in Investment News* explains, this law is designed to stop advisors from putting their own interests in earning higher commission and fees over their clients’ interests, by obtaining the best investments at the lowest prices.

At Nachman Norwood & Parrott Wealth Management Consultancy (NNP), we support these measures which align with our longstanding commitment to putting our clients first.

Central to this ruling are the requirements to ensure greater transparency for retirement investors and to mitigate conflicting advice.

At NNP, we pledge to continue to:

  • Be prudent and transparent with client recommendation
  • Put our clients’ best interests ahead of our own
  • Keep fees and expenses reasonable
  • Not make misleading statements
  • Stay in regular contact with our clients

“This ruling, while significant, will not change the way we conduct business. NNP has always been diligent in ensuring we keep our clients’ best interests at the forefront, and we are pleased efforts have been made to make those practices the industry standard.” – Al Cannon, Managing Director at NNP


Do your employees understand their 401(k)?

Good employers are always striving to do the right things for their employees, and providing them with a retirement plan is a prime example of this. In addition to offering employer-provided benefits, like a 401(k) plan, it’s crucial that the company takes the time to educate their employees on these benefits.

There are a number of ways companies can educate employees on their 401(k) plan. Some ways include:

Inform new employees: provide information in employee handbooks or utilize payroll stuffers, flyers or posters around the office so new employees are aware the plan exists.

  • Explain the enrollment process: schedule enrollment meetings or provide enrollment books so employees can understand how to get started and how to choose the appropriate investments.
  • Discuss regularly: conduct annual or continuing education meetings that can be used to keep participants informed on how and why to save and invest.
  • Provide resources: share the 401(k) website with employees, which has many tools for investment planning and forecasting. Resources like this help employees understand when they can afford to retire. Share these tools through meetings, handouts or email.

Nachman Norwood & Parrott Walth Management Consultancy (NNP) understands the importance of education in retirement planning. Read what criteria companies must meet when offering a 401(k) plan and more information on how companies can educate their employees by downloading NNP’s second quarter newsletter on our website.

Tax Deadlines

Tax season is upon us! Please remember that the team at Nachman Norwood & Parrott Wealth Management Consultancy (NNP) is here to help you. With your approval, we are happy to coordinate with your CPA to not only ensure timely delivery of your NNP tax information but to also collaborate on tax-saving strategies. We are ready to assist with any questions that may arise. Please let us know how we can help you!

Tax Deadline is April 18, 2017. You still have until that date to make a 2016 contribution to the following accounts: Traditional IRA, Roth IRA, Health Savings Account (HSA), and SC Future Scholar 529. Call us if you would like to discuss any last minute contributions; we are here to help.

Maximize Your Charitable Giving This Holiday

As the year-end approaches, many of us give consideration to charitable giving. Considering the post-election rally in the equity markets as well as the potential for tax reform in 2017, now could be the time to maximize those contribution dollars.

A strategy we believe may make sense is to contribute several years of charitable contributions to a donor-advised fund before the year is over. A donor-advised fund allows you to make a charitable contribution and receive an immediate tax benefit while retaining the ability to give the money away over time. With the potential for limits on deductions as well as lower tax rates in the future, the value of the deduction could be worth more today than in future years. Better yet, since many stocks have had a nice gain as of late, you can contribute highly appreciated stock and not have to worry about the capital gain.

Community foundations can provide this service as well as donor-advised funds through several of the largest investment managers such as Schwab, Fidelity and Vanguard.

With just a few weeks left in 2016, not is the time to act. We’re ready to help; please contact us to discuss this further.

Wells Fargo Advisors Financial Network is not a legal or tax advisor.

While annual giving is encouraged, the Donor Advised Fund should be viewed as a long-term philanthropic program.

Tax benefits depend upon your client’s individual circumstances. Clients should consult their tax advisor.

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC, a registered broker-dealer and a separate non-bank affiliate of Wells Fargo & Company.

Nachman Norwood & Parrott Wealth Management Consultancy is a separate entity from WFAFN.