Insurance Enrollment Begins This Month
Beginning this month, you can sign up for a new 2016 health insurance policy on the health insurance Marketplace. You can also change or renew the policy you purchased during the last enrollment period.
Even if your current policy has an automatic renewal feature, you’ll want to verify that you are still eligible for the federal premium tax credit.
What if you didn’t sign up last winter and didn’t have health insurance coverage in 2015? You may owe a penalty on your 2015 federal income tax return.
The penalty for 2015 is the greater of $325 per adult and $162.50 per child under 18 (up to a maximum per-family penalty of $975) or 2% of your modified adjusted gross income (with a maximum of the national average premium for a Bronze plan).
Your Beneficiary Designations
Are your beneficiary designations up to date? Do you know which accounts have beneficiaries, and whom you’ve designated?
It’s easy to lose track. But it’s important to keep them current. Here’s why. When you designate a beneficiary for an account, that person inherits the assets in the account, regardless of what your will says. That’s why updating your will periodically might not be enough. Typically, you’ll have beneficiaries for each of your IRAs, your 401(k) or other retirement plans, annuities, and insurance policies.
Your designations could be out of date because of life changes. For example, since you made your initial choices, you might have married, had children, or divorced. Some of the beneficiaries you chose could have died, divorced, or married.
Changing tax laws also affect beneficiary designations. Choosing the wrong beneficiary, or failing to name a contingent beneficiary, can affect the long-term value of your IRA assets after you die. Make reviewing and updating beneficiary designations part of your year-end financial review. Give us a call if you need help.
Your Required 2015 Distribution
If you’re over 70½ and are required to take distributions from your IRA or other retirement account, remember that you must take your 2015 RMD (required minimum distribution) by December 31. Otherwise you may face a penalty of 50% of the amount not taken. If the 2015 distribution is your first RMD, you have the option of waiting until April 1, 2016, to begin withdrawals.
Over to You
If you have questions or concerns about insurance penalties or your required IRA distribution, please give our office a call. We’re here to help.