Note: This material is intended to give general information. Individual situations vary, and each individual situation should be examined carefully to determine appropriate planning methods. This material does not constitute specific legal advice. For individual planning, it is suggested that you see a professional.

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MEDIQUS Asset Advisors, Inc. and Ausdal Financial Partners, Inc. are independently owned and operated.

Financial Preparedness for a New Administration: What to Expect and How to Adapt

Presenters: Financial Planning: Jeff Witz, CFP®, MEDIQUS Asset Advisors, Inc.

Estate Planning:

Michaeline Gordon, JD, LL. M. Ginsberg Jacobs, LLC

Tax Planning:

Maryann Czarnota, CPA, CFF, FCPA, CVA, MAFF, CDFA, CEPA , The Abrix Group LP

Agenda Estate Planning:

Ø  Basic Planning is Good Planning in Times of Uncertainty

Ø  Trust Protector Provisions

Ø  Building Flexibility into Trust Documents

Tax Planning:

Ø  Planning for Trump Tax Proposals – Individuals & Business Tax

Ø  Provisions Made Permanent and Extended

Ø  Hot Topics for the IRS

Financial Planning:

Ø  Strategies for Uncertain Markets

Ø  Protecting Assets from Unnecessary Loss

Estate Planning

Michaeline Gordon, J. D. LLM.,

Ginsberg Jacobs LLC. 300 South Wacker Drive, Suite 2750

Chicago, Illinois 60606 (312) 660-5964: Direct Line

mgordon@ginsbergjacobs.com

BASIC PLANNING MINIMIZES UNCERTAINTY: 1.  Asset Protection – Becoming Bullet Proof

Ø  Advanced Directives – Power of Attorney for Health and Durable Power of Attorney – Avoiding Financial Crisis in a Health Crisis

Ø  Disability Planning – Revocable Trust – Avoiding Financial Crisis

Ø  Hold Assets Appropriately – Creditor Protection through the use of LLCs, Corporations and Trusts and making appropriate beneficiary designations

2.  Transfer Planning – Lifetime and Death Ø  Use of Trusts For the Protection of Family Ø  Maximizing Estate and Income Tax Planning Based on Current

Law Ø  Beneficiary Designations

HISTORICAL TAX EXEMPTION:

~ OR ~ THERE HAS NEVER BEEN A TIME OF

CERTAINTY

AMERICAN TAXPAYER RELIEF ACT OF 2012: Ø  Reunification of Gift, Estate and Generation-Skipping Transfer Tax Ø  $5.49 million Applicable Exclusion Amount for 2017 (indexed

from 2011) Ø  40% maximum rate Ø  Portability of “Deceased Spousal Unused Exclusion Amount” (if

706 Estate Tax Return) Ø  “Permanent” No Sunset Provision P.L. 112-240, enacted January 2, 2013 (“ATRA”)

Necessary Planning – Tomorrow May Be Too Late

1.  Who will raise your children if both parents die?

2.  If you died unexpectedly would your assets pass to minor children?

3.  Do you have appointed guardians for your children?

Have you considered?

1.  Who will inherit if your family members die in a common disaster?

2.  Do you have any genetic material on ice?

3.  Have you ever made large gifts or loans to others?

4.  Who is going to take care of your pets?

5.  Do you have wishes regarding your health care that you want to be implemented if you are incapacitated?

Would anyone be able to?

1.  Is anyone authorized to access your electronic accounts?

2.  Is there someone else in your family you want to take care of?

3.  Is there someone in your family who should NOT inherit due to disability drug abuse, or to avoid disqualifying from public aid? (Does that person need a “Special Needs Trust”.)

Revocable Trust Planning Remains Standard

Ø  Successor trustees can PRIVATELY manage trust in the event of your incapacity

Ø  Probate avoidance – PRIVATE, direct transfer of your assets – instead of public delayed administration through court

Ø  Can do additional estate planning during incapacity depending on how trust is drafted

Jim AND Karen (Assuming Jim Dies First)

* Co-Trustee age 30 Sole Trustee age 40

Beneficiary Designation Pitfalls:

Ø  Common Estate Planning Mistakes in Naming Beneficiaries: §  Naming minors §  Not coordinating BD with wills/trusts §  Not naming contingent beneficiaries §  Naming one’s “Estate” §  Naming a trust improperly

Powers of Attorney:

Property Health Care

Agent:

Who will make decisions?

Trust Protectors: Ø  Administrative Changes

§  Correct Errors §  Power to appoint successor trustee §  Invest in a business, residence or special assets

Ø  Law Changes Amend for

§  Tax law changes §  Change governing law §  Special Needs beneficiary

Checklist for Ten Estate Planning Tips:

P Protect Assets using revocable trusts for disability/probate avoidance

L Leverage Legal Exemptions such as qualified plans, insurance;

A Asset Protection of through LLCs and insurance trusts;

N Never go bare –POAs

I Income tax planning coordinated with Estate Plan;

T Trust Planning – Trust Protector;

P Protect Inheritance in Marital Trust and Family Trust;

A Advisers working as a team;

Y Yearly review – or at least every three years; and

S Savings through planning;

Financial Planning Maryann Czarnota, CPA, CFF, FCPA, CVA, MAFF,

CDFA, CEPA

The Abrix Group, LP 3400 Dundee Road, Suite 200 | Northbrook, IL

60062 847.656.8265 | 847.498.6721 (fax)

mczarnota@abrix.com

Tax Planning

Tax Planning: Ø  Planning for Trump Tax Proposals – Individuals

& Business Tax

Ø  Provisions Made Permanent and Extended Ø  Hot Topics for the IRS

Planning for Trump Tax Proposals-Individuals 21

§  Current Seven tax brackets to three brackets (10%, 25%, 35%)

§  Retains existing capital gains rate structure-max rate of 20%

§  Eliminate all individual tax deductions except for mortgage interest and charitable giving

§  Repeal of state and local tax deduction

Planning for Trump Tax Proposals-Individuals 22

§  The 3.8% percent Obamacare tax on investment income will be repealed

§  Alternative Minimum Tax will be repealed

§  Standard deduction will be doubled $25,400 from

$12,700 for married filing joint and $12,700 from $6,350 for singles

Planning for Trump Tax Proposals-Business Tax 23

§  Lower business tax rate from 35% to 15%

§  Pass-through businesses (sole

proprietors, partnerships, Sub S corps) could elect to pay flat tax of 15% instead of regular tax rates

Tax Rates in Effect for 2017

•  Social Security Tax -12.4% on wages up to $127,200

Medicare Tax – 2.9% on wages (1/2 is employer’s responsibility)

•  Additional Medicare Tax - 0.9% on wages over $250,000 Employer required to start withholding at $200,000 of W-2 wages (no employer match)

•  AMT – 26% on AMT income under $187,800 ($93,900 MFS)

28% on taxable income over $187,800 ($93,900 MFS)

•  Capital Gains Tax – 0% if in the 10% or 15% bracket - 15% if in the 25%, 28%, 33% or 35% bracket - 20% if in the 39.6% bracket

•  Net Investment Income Tax – 3.8% on investment income if modified AGI income is over $250,000

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New filing deadlines for 2016 year end

•  S Corporations, LLC’s, and Partnership tax returns are due March 15th

•  C Corporations are due April 15th

•  FBAR (foreign investments) returns are due

April 15th

•  No change to 1040 filing deadline

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Phase-out for itemized deductions and personal exemptions

•  Phase out of itemized deductions (starting at $318,800 of AGI for married filing joint and $261,500 for singles)

•  Phase-out is equal to the lesser of (1) 3% of AGI over

$313,800 or (2) 80% of itemized deductions •  Phase out of personal exemptions – lose 2% for each

$2,500 by which AGI exceeds $313,800 for married filing joint and $261,500 for singles

•  This further increases the effective tax rate for higher-

income taxpayers

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Provisions that were made permanent and extended

•  Increased Sec 179 Expensing to $500,000 •  Additional first year depreciation 50% for 2016-2017

•  Additional first year depreciation 40% for 2018, 30% for 2019 and not applicable after 2019

•  15 year life for qualified leasehold improvements

•  IRA and RMD transfers to Charity •  Educator’s $250 expense deduction

•  IRA rollover-limited to one rollover in a 12 month period

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Tax Planning Tips

§  Look at two year windows

§  Most will benefit from accelerating write-offs from 2018 to 2017 while deferring income

§  Push two years of itemized deductions into one year

§  Prepay real estate and state income taxes (watch for AMT)

§  For Seniors beginning in 2017 threshold for deducting medical costs jumps to 10% of AGI

§  Work the standard deduction-if you won’t hit the threshold in 2016, delay payment of itemized deductions until 2017

§  Medicare premiums-AGI exceeding $170,000 in 2016 will increase 2018 premiums

§  Charitable deductions – donor advised funds

§  Have business buy a new heavy SUV-expense up to $25,000 plus 50% bonus depreciation

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Tax Planning Tips-Investments

§  Harvest capital losses to offset gains, generate capital gains or use up capital loss carryforward

§  See if you can benefit from the 0% rate on long term gains and dividends (income under $75,901)

§  Donate appreciated stock or mutual funds §  Take advantage of the gift tax exclusion up to

$14,000 per person §  Fund a non-deductible IRA and immediately convert

to a Roth

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Review Individual Health Plans

•  Large increases coming for 2017 •  Individual plans may no longer be

cheaper than group plans-compare on an after tax basis

•  Number of available Hospitals and

Doctors has been drastically reduced.

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Hot Topics for the IRS

§  Charitable contribution – documentation §  Business deductions – documentation §  S Corporation – basis & reasonable

compensation §  Independent contractor vs employee §  Retirement plan loan abuse §  Identify theft §  FBar reporting – Overseas Assets

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IRS Scam

§  Scam by Phone: Threatening phone calls by IRS impersonators asking for money

§  Scam by email: Emails claiming to be from IRS §  Generally, IRS employees are supposed to

communicate with taxpayers only by regular mail or (rarely) by phone. E-mail communication is only if you are under audit. IRS never asks to send money right away through Western Union or currency exchange

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Financial Planning Jeff Witz, CFP®

MEDIQUS Asset Advisors, Inc.

200 North LaSalle Street, Suite 2300 Chicago, IL 60601

800-883-8555 witz@mediqus.com www.mediqus.com

Protecting Your Investments from…

Top Reasons for Long-Term Investment Loss: Ø  Panic Ø  Euphoria Ø  Afraid of Change Ø  Believe information = wisdom. Ø  Under-diversified Ø  Over-diversified Ø  Unmanaged Costs

Investor Behavior vs. Benchmark

Source: DALBAR (average equity and fixed-income investors data). DALBAR uses data from the Investment Company Institute, Standard & Poor’s and Barclays Capital index products to compare mutual fund investor behavior with an appropriate set of benchmarks. These behaviors are then used to simulate the “average investor.” Hypothetical investments for the equity and fixed-income investors are based on average annual total returns. Barclays Capital U.S. Aggregate Index represents the U.S. investment-grade fixed-rate bond market. The indexes are unmanaged and, therefore, have no expenses.

DALBAR Quantitative Analysis of Investor Behavior: Ending values and average annual total returns of hypothetical $100,000 initial investments for 20 year period ending 12/31/15.

0

200000

400000

600000

20 Years

Benchmark

Behavior

A Process to Keep You on Track

Analyze Current Position

Design Optimal Portfolio

Formalize Investment Policy

Implement Policy

Monitor & Supervise

Are you owning or loaning?

“Loanership Assets”: You lend your assets in exchange for interest payments and the expectation to have your assets returned at the end of the investment term. Your long term performance depends on the ability of the borrower to make interest payments and return your assets.

Examples: CD’s, Cash Values, Fixed Annuities, Government & Corporate Bonds, etc.

“Ownership Assets”: You own a part (or all) of the underlying asset. Your long term performance depends on a variety of factors.

Examples: Stocks, Real Estate, Collectibles, etc.

Range of Annual Returns

Small Stocks

Common Stocks

Corporate Bonds

Long-Term Government

Bonds

Treasury Bills

Each bar shows the range of total annual returns for each asset over the period 1926 thru 2015.

(Source Dimensional Fund Advisors)

The most important determinant …

Asset Class Selection: Ø  Asset class selection, or the decision regarding which broad asset

classes to invest in, is the most important decision an investor makes over the long haul.

A Process to Keep You on Track

Analyze Current Position

Design Optimal Portfolio

Formalize Investment Policy

Implement Policy

Monitor & Supervise

Questions?

A Final Question for You:

What is the #1 reason physicians fail financially?

Procrastination

Thank you!