The 2013 Tax Landscapeby Sanford Trado, CPA It is almost a year later since our last tax law change update and the tax landscape is much clearer.

At the end of 2012 there was uncertainty as to what Congress was going to do regarding tax rate increases and allowing certain deductions and credits to expire. Well, the results are in.

The changes that took place affect primary single filing taxpayers who have compensation or income of $200k or $250K for joint filers. Both categories of taxpayers saw changes to their tax rates as well as their deductions as follows:

A Quar ter ly Publication Vol . 6 Issue 1 / Januar y 2014the WealthWATCHSM the WealthWATCHSM 1

INSIDE THIS ISSUE

The Tax Landscape page 1

Letter From The President page 2

Keep Your Brain Sharp page 2

Economic Commentary page 3

• The law created a new 39.6% tax bracket for single tax filers with taxable income of $400K or $450K joint filers.

• There was the creation of the 3.8% Net Investment Income Tax on taxpayers with Modified Adjusted Gross Income of $200K for a single filer and $250K for joint filers.

• Single filers whose compensation exceeds $200K or $250K for joint filers will pay an additional .9% Medicare Surtax, and

• Taxpayers who are in the 39.6% bracket saw an increase to the long-term capital gain and qualified dividend rate from 15% to 20%.

The law did preserve the 0% rate on long-term capital gains and qualified dividends for taxpayers below the 25% tax bracket and 15% for those taxpayers above 15% and below the 39.6% tax bracket.

The tax law also changed the amount of deductions for certain itemized deductions and personal exemptions for taxpayers with Adjusted Gross Income greater than $250k for single filers and $300K for joint filers. Thus, the taxpayer’s itemized deduction and personal exemption will be reduced.

The following are some of the deduction and credits that were preserved in the 2013 tax law:

• The tuition and fee deduction

• Above the line student loan interest deduction

• Child Credit remained at $1K per child, and

• The American Opportunity Tax credit through 2017.

Finally, the tax law settled at a $5 million estate unified tax and gift exemption with a 40% tax rate, and an annual gift exclusion amount of $14K.

As 2013 came to a close there is little change in the tax law. However, two certainties are: taxes and changes. Please contact us with any questions or concerns regarding your specific situation.

This is for informational purposes only and should not be construed as tax, legal or financial advice. Please consult your tax, legal or financial advisor regarding your specific situation.

Sanford Trado

Lineweaver Financial Group is independently owned and operated. Securities offered through Sigma Financial Corporation. Member FINRA/SIPC.

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by Jim Lineweaver, CFP®, President and FounderLE T TER FROM THE PRESIDENT

I hope you had a great Holiday Season! The holidays are a great time to spend with family and friends. Sometimes they can be stressful times, but I hope you had a chance to take a few minutes to capture some wonderful memories.

While I was at home working in my office, thinking about what to write for my president’s letter, my 11 year old daughter asked me if I would help her with her homework. She pulled up a chair across the desk and started asking me questions, and before I knew it we were fully engaged in learning about fossil fuels. At the end of the homework session, she gave me a big hug and told me that she would be glad to help me if I needed help with my homework. I told her I really appreciated her help and that she had already given me all the help I needed because now I knew what I was going to write about!

As my kids continue to get older (although I stay the same age), I am always trying to guide them with valuable life lessons. They might range from standing up for things they believe in, doing a good deed for someone without being asked, lending a helping hand to others less fortunate, to simply getting along with their siblings and cleaning up after themselves. Regardless of the issues at hand, I am trying to be a resource for my kids and pass along my knowledge and expertise.

The concept of knowing who to turn to for answers and where you can go to get a financial checkup is the philosophy behind why I built the Lineweaver WealthWatch Center. The Center can be a complete resource to you and your family and friends for all their financial, tax, legal and insurance issues. I still come across many people on a regular basis who haven’t taken the time to get a trust done, set up the proper powers of attorney, list the correct beneficiaries on their accounts, set up the proper life and disability insurance, are not maxing out their retirement plans, are paying too much in taxes, etc. The most successful people in life are the ones who take a few minutes out of their daily lives to plan their day, come up with an action list, and make steady progress towards their goals and objectives. Life is always going to throw you a few curveballs, but you have to be able to bounce back and stick to your mission and game plan. LFG not only helps you stay on track, but will also coordinate all the necessary services so you can reach your destination safely.

If you have all your financial affairs in order, like many of our clients, do your children have their affairs in order? How about your parents or siblings? Let LFG also be a resource for you, your family, and friends. I promise I will not scold them or send them to their room if things aren’t done correctly. But I will try to make sure they take actions that might greatly enhance their life or at least protect the ones they care about the most.

Some people have different New Year’s resolutions, but a financial checkup is not a bad place to start. I hope you, your family and friends have an outstanding 2014!

KEEP YOUR BR AIN SHARP

With the New Year here, many of us are making resolutions like lose weight, keep in touch more, exercise daily. Don’t forget about resolving to keep your mind sharp! Here are some tips and tricks for good mental health.

Snack wisely. Apples help protect the brain from neuro-degenerative diseases. Berries contain antioxidants that help with blood flow. Nuts and seeds contain omega-3 fatty acids, which are thought to be instrumental in maintaining brain function. Even chocolate (in moderation, of course!) helps to improve blood flow and circulation.

“It’s not the years in your life that count. It’s the life in your years.”

- Abraham Lincoln

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As 2013 comes to a close, the final quarter may prove to be the most positive one in terms of sentiment and outlook. Though Q4 began with a government shutdown and political discord, the economy is showing resiliency. Manufacturing is strong and domestic auto sales reached its highest annualized rate since February 2007 (Autodata, The Wall Street Journal). Housing is still trending higher in both sales and price. While unemployment has decreased to 7% and US GDP was revised upward to 3.6% (Forbes).

Equity markets continue to appreciate with the NASDAQ 100 topping 4000. The Dow Jones reached and surpassed the 16,000 mark for the first time ever. Likewise, the S&P 500 pushed through the 1800 level for the first time. All three indices are set for double-digit gains for the year. The European Union continues to slog through stagnant growth that envelops the continent. China’s leadership continues to revamp the economy to be more consumer-driven and less dependent on exports and government investments.

The year has been robust in terms of market gains and momentum. Economic activity is also picking up in developed economies and indications reflect continued optimism for the start of 2014. Earnings expectations in developed markets are close to bottoming out and should begin to turn up soon. Tapering of asset purchases is likely to start in the US over the next several months, but this will still leave US policy very loose, while in other regions central banks remain very accommodative. Europe recovers slowly from its protracted recession, while worries continue about the health of emerging economies, particularly in countries with current account deficits. Continued global policy should remain supportive for risk assets for some time to come. While we remain positive on the market, we believe this is an excellent time to review your allocation to determine if changes are need to keep your portfolio in line with your long-term objectives.

Past market performance is no guarantee of future investment performance or success. It is not possible to invest directly in an index.

Tune in to WKYC Channel 3 at 11:30 am every other Sunday to see Jim Lineweaver on the Golden Opportunities show with Armond Budish. Jim and Armond discuss current financial topics in an easy to understand format.

Upcoming shows and topics:

MONEY WATCH

GOLDEN OPPORTUNITIES

ECONOMIC COMMENTARY by Stephen Yarmesch, AIF ®Riverview Research, LLC

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DJIA: 16,576.662013: +26.5%

10 Year Treasury Note Yield: 3.03%12/31/12: 1.76% 9/30/13: 2.62%

30 Year Mortgage Rate: 4.58%12/31/12: 3.41% 9/30/13: 4.35%

Source: Yahoo FinancePast market performance is no guarantee of future investment performance or success.It is not possible to invest directly in an index. Close of Market 12/31/13

Sunday, January 12, 2014 Buy Low, Sell High- Time for a change? Sunday, January 26, 2014 Rethinking Risk Sunday, February 9, 2014 Outsmarting Investment Fraud

Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design) and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements.

With the New Year here, many of us are making resolutions like lose weight, keep in touch more, exercise daily. Don’t forget about resolving to keep your mind sharp! Here are some tips and tricks for good mental health.

Snack wisely. Apples help protect the brain from neuro-degenerative diseases. Berries contain antioxidants that help with blood flow. Nuts and seeds contain omega-3 fatty acids, which are thought to be instru-mental in maintaining brain function. Even chocolate (in moderation, of course!) helps to improve blood flow and circulation.

Try curry! Turmeric, the yellow spice found in many curry recipes, has powerful anti-inflammatory and antioxidant properties. An enzyme

TRIVIA

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A 30-second ad spot in the 2013 Super Bowl cost an average of $3.8 million. The same ad would have cost $37,500 in the first Super Bowl in 1967.

At Lineweaver Financial Group, we encourage all clients to stay active during their retirement to help keep their minds and bodies sharp and productive. Longtime client Annette Pollarine is a great example of this. While working as a teacher, Annette would take her classes on field trips to the Cleveland Metroparks Zoo, and her students said that when she decided to retire, she should become a zoo volunteer- so she did just that! Now she volunteers each week, greeting and helping visitors with directions,

CLIENT SPOTLIGHTAnnette Pollarine

providing information on the different exhibits, as well as assisting the zookeepers behind the scenes. Annette builds interactive activities to help enrich the animals, for example, nesting boxes inside of boxes each containing alfalfa or straw to serve primates and monkeys their food. This encourages the aye-aye, gibbons, guenons and spider monkeys to hunt for their food like they would in the wild, rather than just having the food served to them. Annette really enjoys being able to volunteer at the Cleveland Metroparks Zoo where she can assist the public, the zookeepers and staff.

If you would like to receive our newsletter through email, please email Jennifer at Jennifer@lineweaver.net