Oppenheimer & Co. Inc.The Israelite Group ofOppenheimer & Co. Inc.500 W Madison Suite 4000Chicago, IL 60661312-360-5624dan.israelite@opco.com

July 2014Can You Make Some Green by InvestingGreen?

Charitable Gifts of Items You No Longer Need

Why Not Make Your Next Trip a VolunteerVacation?

Have the rules for 401(k) in-plan Rothconversions changed?

The Israelite Group Monthly NewsletterCan You Make Some Green by Investing Green?

See disclaimer on final page

With the conclusion of the latest FOMCmeeting we are starting to get a clearerpicture of possible outcomes of the Fedtaper. As expected, monthly bondpurchases are being cut another $10billion, to a total of $35 billion. The recentuptick in positive economic indicators hasled many to believe that we are on our wayto a sustainable financial recovery. Ofcourse, as we are seeing more stability, thequestion of when short term interest rateswill be raised is becoming something of aheated debate. The consensus is that wewill see a moderate bump in rates towardthe middle of next year, with a very friendlyplateau toward the long end of the curve.

While we're not yet all of the way out of thewoods, Fed chair Janet Yellen is displayinga very accommodative attitude. She hasmade it very clear that the Fed will continueits flexible policy approach and that thestrength of the economy is what will bemost crucial in all decisions going forward.

The Israelite Group

The release in April of the long-awaited reportfrom the United Nations' IntergovernmentalPanel on Climate Change has spurred reneweddiscussion of ways to combat climate changeand its effects. The report, written by leadingscientists from around the globe, says that tokeep greenhouse emissions below criticallevels, the world must make substantialchanges--and quickly--in how energy isproduced and consumed.

That finding has focused fresh attention onso-called "green investing." Here are someconsiderations that can be especially importantin this arena.

No shortage of choicesIf you're interested in exploring greeninvestments, you have a variety of possibleoptions. They include renewable energysources, technologies that can improve theenvironmental footprint of existing energysources, clean water, clean air, andtechnologies that can help reduce overallconsumption, particularly of nonbiodegradablesubstances.

The broad scope of green technologies canmake it difficult to choose among the myriadinvestment opportunities, especially if you don'thave expertise in a particular field or the time orenergy to acquire that knowledge. Unlessyou're familiar with the science behind aspecific company's product or service, youmight benefit from casting a wider net. Thoughdiversification can't guarantee a profit oreliminate the possibility of a loss, it can helpyou manage the amount of risk you face from asingle company.

A great technology is not the samething as a great stockEven if you have special knowledge of aparticular field, don't let that blind you to acompany's business fundamentals. If you'reconsidering a small company stock, don't forgetthat small caps can be extremely volatile. Inaddition to the risks involved with all stocks, asmall-company stock can be affecteddisproportionately by the actions of a singlelarge investor or a report by a single investment

research department, especially if the stock isthinly traded. If that worries you, one alternativemight be to invest in larger companies thathave made a significant commitment toinitiatives in that field and that might have otherbusiness advantages. Though they may nothave a small company's rapid growth potentialor appeal as a possible takeover target, theyoften have more resources than a smallercompany to make acquisitions or manufactureand market globally more efficiently.

Important considerationsCertain factors that apply to all stocks areespecially important when considering aninvestment in green companies.

What's the competitive landscape? An idea thatseems promising can quickly be superseded bythe latest innovation. While it's difficult toforecast technical turning points, it's helpful toknow the major players in that space, their keydevelopment efforts, and roughly how they'repositioned.

How dependent is a company on externalsupport? Many countries are making significantgreen investments, racing to establishdominance on the global playing field of greentechnologies. Emerging technologies often aredependent on some form of governmentsupport, such as tax credits, loan guarantees,or sponsored pilot programs. However, politicalsupport for such initiatives can come and go, ascan investor enthusiasm for specifictechnologies.

How capital-intensive is the technology? Manygreen technology companies may have little orno profits yet but a substantial need for capitalfrom a cash flow standpoint or as a result of thetechnology itself. That could make a companyvulnerable to a potential credit crunch or risingborrowing costs, which could affect its ability todevelop and market even the most promisingtechnology.

Note: All investing involves risk, including thepotential loss of principal, and there can be noguarantee that any strategy will be successful.

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Charitable Gifts of Items You No Longer NeedIf you have used clothing, household goods, ora car that you no longer need, you may be ableto do good by contributing the property tocharity while obtaining an income tax deductionfor your charitable contribution. Subject tocertain limitations, the amount of yourcharitable contribution is usually the fair marketvalue (the price that property would sell for onthe open market) of the property at the time ofthe contribution.

Used clothing and household goodsYou generally cannot take a deduction fordonations of used clothing or household goodsunless the property is in good used condition orbetter. However, you can take a deduction forused clothing or household goods that are notin good used condition or better if the claimedvalue is greater than $500 and you include aqualified appraisal with your tax return.

The value of used clothing or household goodsis usually far less than what you paid for theproperty. A good indication of the value of usedclothing is the price that a buyer would pay inused clothing stores, such as consignment orthrift stores. Used household goods may havelittle or no value because of their worncondition, or because they are out of style or nolonger useful.

Used carsThe value of a used car can usually bedetermined using a used car pricing guide for aprivate party sale. The price listed should be fora car of the same make, model, and year, andwith similar options and accessories.Adjustments may be needed for wear and tear,and mileage.

However, your deduction for a donated car maybe limited to the amount for which the charitythen sells the car. This rule applies if theclaimed value for the car is over $500 unless:(1) the charity makes a significant interveninguse of or material improvement to the carbefore selling it; or (2) the charity gives thevehicle, or sells it for well below fair marketvalue, to a needy individual to further theorganization's charitable purpose.

You must attach Copy B of Form 1098-C,Contributions of Motor Vehicles, Boats, andAirplanes, (or other statement from the charitycontaining the same information) to your taxreturn. Form 1098-C shows the gross proceedsthe charity received if the charity sold the carand whether either of the two exceptions forcars valued at more than $500 applies.

If the charity sells the car for $500 or less (andneither of the two exceptions applies), yourdeduction is generally limited to the lesser of$500 or the car's fair market value on the dateof the contribution.

Other requirementsA receipt is generally required from the charityfor all noncash gifts. However, a receipt maynot be required where it is impractical to getone (e.g., leaving clothing at a charity'sunattended drop site).

A written statement is required from the charityacknowledging all noncash gifts above $250.The acknowledgment must generally include adescription and good faith estimate of the valueof any goods or services (if any) you received inreturn for your contribution. Your charitablecontribution deduction is reduced if you receivesomething in return for your contribution.

An appraisal is generally needed when youdonate an item or group of items of property ifthe claimed value is more than $5,000. Youmust also complete Section B of Form 8283and attach it to your tax return. Section B ofForm 8283 should be signed by both theappraiser and a responsible officer of thecharity. However, you do not need an appraisalfor the donation of a car if the deduction islimited to the gross proceeds of its sale by thecharity.

Limits on deductionsCharitable contribution deductions are generallylimited to 50% of your adjusted gross income(AGI) (or 30% or 20% of AGI depending on thetype of charity and the property donated).Disallowed amounts can generally be carriedover and deducted in the following five years,subject to the percentage limits in those years.If you donate property with a fair market valuethat is more than your income tax basis in it(not usually a concern when donating usedgoods), your deduction is generally limited toyour basis in the property, except for capitalgain property when you use the 30% of AGIlimit.

The total of your charitable contributiondeductions and certain other itemizeddeductions is limited (but not reduced by morethan 80%) if your adjusted gross income in2014 is more than $254,200 (for singletaxpayers, $305,050 for married filing jointlytaxpayers).

Consult a tax professionaland visit the IRS website formore information.

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Why Not Make Your Next Trip a Volunteer Vacation?Is your idea of a perfect vacation spending timealone on a beach with a good book? Or wouldyou prefer a more active vacation where youare part of a group, constantly challengingyourself, and using your talents and skills tohelp others? If the latter sounds moreappealing, then a volunteer vacation might beright for you.

Why take a volunteer vacation?Having the chance to give back, meet newpeople, form friendships, and immerse yourselfin a different culture are some of the topreasons to take a volunteer vacation. And nomatter why and where you choose to travel,you'll have experiences that are not available tothe average tourist.

A volunteer vacation also allows you to workwith others who share your interests. Forexample, if you love the outdoors, you can workwith park rangers on a national parks project inthe United States or travel with a conservationgroup to Peru. Or if you've always wanted towork with children, you can find a serviceproject at an orphanage in Haiti, or volunteer ata camp for children with special needs inHawaii.

Who can serve as a volunteer?Whether you're a solo traveler, a retiree, astudent, a family with younger children, or agrandparent with teenage grandchildren, youcan find a suitable volunteer opportunity. Manyvacations don't require any experience--just awillingness to help and enjoy the camaraderieof working with individuals from your hostcommunity and members of your volunteergroup. However, you'll get more out of your tripif you find one that matches your interests, skillset, and stamina level. Though you can chooseto travel to a remote location or anunderdeveloped country, you can also make adifference in a less adventurous setting. Forexample, you can help teach English at aschool in a major city, work on an artconservation project in a museum, or care forinjured animals at a zoo. The choice is yours.

What can you expect from your trip?Trip length varies, but many last from one tofour weeks. During that time, you'll be expectedto devote a substantial number of hours toproject work.

Yet volunteer vacations aren't all work and noplay. Trips generally incorporate rest days orleisure periods where you're free to explore onyour own or participate in a group tour, givingyou unique insight into the area and a chanceto unwind.

How much will your trip cost?Some people are surprised to learn that there'sa cost associated with volunteering, but you'llgenerally need to pay for your own travelexpenses. Your trip may cost hundreds orthousands of dollars, depending on yourdestination, itinerary, and accommodations.

You may be able to offset part of the cost ofyour trip by deducting certain trip-relatedexpenses when you file your federal income taxreturn. To get any tax benefits, your trip mustbe sponsored by a qualified organization (checkwith the charity or the IRS); the personalelement of your trip must be insignificant (i.e.,the time spent on pleasure, recreation, orvacation); and you must itemize your incometax deductions. You can generally deductactual unreimbursed costs related to yourvolunteer service (such as airfare, lodging, andmeals) but you can't deduct the value of yourtime or services. These are just generalguidelines--for more information, ask your taxadvisor and review IRS publication 526,Charitable Contributions.

What questions should you ask?Before you sign up for a volunteer vacation, it'svery important to make sure that you'retraveling with an organization you trust. Tripsmay be sponsored by churches, national orglobal nonprofit volunteer organizations, orfor-profit companies. Here are some of thequestions you should ask before signing up.Some of this information may be found inliterature provided by the sponsoringorganization:

• How long has the group or organization beenconducting volunteer vacations?

• How large is the volunteer group?• How experienced are the team leaders? How

well do they know the culture and the area?• Will training be necessary, and if so, when

and where will it be provided?• What does the trip fee cover? Airfare?

Meals? Transportation to the work site?• Are costs or fees refundable? Make sure you

read all policies and understand what willhappen if you're unable to travel.

• What about insurance? You may be asked toprovide proof of health insurance, or iftraveling overseas, purchase medical andemergency evacuation coverage.

• How do you prepare, and what will you needto bring? You should be given a checklist oftasks to complete before your trip, andpacking guidelines.

One option for findingvolunteer vacationopportunities in the UnitedStates or overseas is thenonprofit organization JustGive. To view a list ofresources for potentialvolunteers, visit theorganization's website,www.justgive.org.

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Oppenheimer & Co. Inc.The Israelite Group ofOppenheimer & Co. Inc.500 W Madison Suite 4000Chicago, IL 60661312-360-5624dan.israelite@opco.com

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2014

This newsletter should not beconstrued as an offer to sell or thesolicitation of an offer to buy anysecurity. The information enclosedherewith has been obtained fromoutside sources and is not theproduct of Oppenheimer & Co. Inc.("Oppenheimer") or its affiliates.Oppenheimer has not verified theinformation and does notguarantee its accuracy orcompleteness. Additionalinformation is available uponrequest. Oppenheimer, nor any ofits employee or affiliates, does notprovide legal or tax advice.However, your OppenheimerFinancial Advisor will work withclients, their attorneys and their taxprofessionals to help ensure all oftheir needs are met and properlyexecuted. Oppenheimer & Co. Inc.Transacts Business on all PrincipalExchanges and is a member ofSIPC.

Is there a new one-rollover-per-year rule for IRAs?Yes--starting in 2015.

The Internal Revenue Codesays that if you receive adistribution from an IRA, youcan't make a tax-free (60-day)

rollover into another IRA if you've alreadycompleted a tax-free rollover within theprevious 12 months. The long-standing positionof the IRS, reflected in Publication 590 andproposed regulations, was that this rule appliedseparately to each IRA you own.

Using an IRS example, assume you have twotraditional IRAs, IRA-1 and IRA-2. You take adistribution from IRA-1 and within 60 days roll itover into your new traditional IRA-3. Under theold rule, you could not make another tax-free60-day rollover from IRA-1 (or IRA-3) within oneyear from the date of your distribution. But youcould still make a tax-free rollover from IRA-2 toany other traditional IRA.

Recently a taxpayer, Mr. Bobrow, did just whatthe example above seemed to allow, taking adistribution from IRA-1 and repaying it back toIRA-1 within 60 days, and then taking adistribution from IRA-2 and repaying it back toIRA-2 within 60 days. Unfortunately for thetaxpayer, the IRS decided this was no longer

the correct interpretation, and told Mr. Bobrowthat his transactions violated theone-rollover-per-year rule. The case made itsway to the Tax Court, which agreed with theIRS and held that regardless of how many IRAshe or she maintains, a taxpayer may make onlyone nontaxable 60-day rollover within each12-month period.

Not surprisingly, the IRS has announced that itwill follow the Bobrow case beginning in 2015(more technically, the new rule will not apply toany rollover that involves a distributionoccurring before January 1, 2015). For the restof 2014 the "old" one-rollover-per-year rule inIRS Publication 590 (see above) will apply toany IRA distributions you receive. But keep inmind that you can make unlimited directtransfers (as opposed to 60-day rollovers)between IRAs--these aren't subject to theone-rollover-per-year rule. So if you don't havea need to actually use the cash for some periodof time, it's generally safer to use the directtransfer approach and avoid this potentialproblem altogether.

(Note: The one-rollover-per-year rule alsoapplies--separately--to your Roth IRAs.)

Have the rules for 401(k) in-plan Roth conversionschanged?Yes. Thanks to the AmericanTaxpayer Relief Act of 2012(ATRA), the rules for making401(k) in-plan Roth

conversions have gotten substantially easier.(These rules also apply to 403(b) and 457(b)plans.)

A 401(k) in-plan Roth conversion (also calledan "in-plan Roth rollover") allows you to transferthe non-Roth portion of your 401(k) accountinto a designated Roth account within the sameplan. The amount you convert is subject tofederal income tax in the year of the conversion(except for any nontaxable basis you have inthe amount transferred), but qualifieddistributions from the Roth account are entirelyincome tax free. The 10% early distributionpenalty doesn't apply to amounts you convert(but that penalty tax may be reclaimed by theIRS if you take a nonqualified distribution fromyour Roth account within five years of theconversion).

While in-plan conversions have been aroundsince 2010, they haven't been widely used,because they were available only if you wereotherwise entitled to a distribution from your

plan--for example, upon terminatingemployment, turning 59½, becoming disabled,or in other limited circumstances. But in thatcase, you already had the option of rolling yourfunds over (converting) into a Roth IRA.

ATRA eliminated the requirement that you beeligible for a distribution from the plan in orderto make an in-plan conversion. Now, if yourplan permits, you can convert any vested partof your 401(k) plan account into a designatedRoth account regardless of whether you'reotherwise eligible for a plan distribution. TheIRS has also just recently issued regulationsthat provide additional clarity on how in-planconversions work.

Caution: Whether a Roth conversion makessense financially depends on a number offactors, including your current and anticipatedfuture tax rates, the availability of funds withwhich to pay the current tax bill, and when youplan to begin receiving distributions from theplan. Also, you should consider that theadditional income from a conversion mayimpact tax credits, deductions, and phaseouts;marginal tax rates; alternative minimum taxliability; and eligibility for college financial aid.

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