What You Need to Know About Tax Reform

This fall, the Senate and House released proposed legislation that would dramatically alter taxes in the United States.  Both bills have to pass through a number of steps before potentially becoming law. In the meantime, many people have questions about how the changes could affect them. Read on to learn more about the following tax details:

1.  What similarities the plans share

2.  Where strategies differ

3.  How tax brackets could change

Tax reform is complicated, so we can only cover some of the biggest changes here. Despite differences in each plan, both bills contain additional proposals that could affect everything from small business taxes to foreign revenue.

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Strong Markets for the Holidays

As the holiday season progresses, the markets continue to impress.  Last week, many energy, financial, and industrial sector stocks helped drive performance.  Hitting record highs yet again, the S&P gained 0.35%, and the Dow jumped 0.40% for the week.  Meanwhile, the NASDAQ fell slightly by 0.11%, and the MSCI EAFE rose 0.08%.

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Looking Beyond Politics

Markets went for a wild ride last week-especially on Friday.  In fact, on December 1, the S&P 500 had its largest fluctuations since the day after the 2016 presidential election.

Nonetheless, two of the major domestic markets hit new record highs on Thursday and ended the week with sizable gains.

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Tips for Families Who Have Children With Special Needs

When beginning to build their families, few parents expect to have a child with special needs. However, the experience is surprisingly common and affects millions of people throughout the United States. In fact, current estimates show that approximately 1 in 6 children from age 3 to 17 have at least one developmental disorder.[1]

Any parent knows that having a child brings love, satisfaction, and busyness. And being a parent of a child with special needs brings new concerns to address, as well. Depending on your child’s unique situation, you may need to plan for a lifetime of care. This responsibility can bring both a significant financial investment to prepare for and estate-planning needs to manage when you are no longer here to oversee your child’s care.

If you have a child with special needs, we recommend you consider taking the following steps to help provide a sound financial standing today and in the future:

  • Name a Guardian and a Trustee
    Naming a guardian and trustee will help ensure your child has the support he or she deserves should you no longer be able to provide care. This step is especially important if your child may need care after becoming a legal adult.[2]
  • Write a Letter of Intent
    A Letter of Intent allows you to document the specific details that matter in your child’s daily life—from routines to preferences to contact information for doctors. By writing a Letter of Intent, you give clear guidance on your child’s needs and your wishes to both the legal system and caregivers. Think of this letter as a tool for describing your child’s history, his or her current circumstances, and your hopes and dreams for the future. While this document is not legally binding, it can help provide the guidance and perspectives that courts or a guardian will need when making decisions for your child.[3]
  • Establish a Special Needs Trust
    People with special needs are often eligible for a variety of government benefits. In order to qualify, they must not have assets beyond a certain level—typically as low as $2,000. A Special Needs Trust can allow you to leave money and other assets to your child without jeopardizing his or her ability to claim government benefits.[4]
  • Educate Your Family Members
    If your child’s grandparents, aunts, uncles, or other family members would like to include him or her in their will, you need to ensure they know the correct way to do so. Educate them on how and why to name the Special Needs Trust as a beneficiary. Taking this step is crucial, so their intended generosity doesn’t inadvertently derail your child’s eligibility for government benefits.[5]
  • Build Your Savings
    Giving your child the best possible care is often very expensive—and your insurance or school system may not cover all of the costs for required therapies and services. To help prepare for these expenses, you should both strive to increase how much money you save each month and explore specialized healthcare accounts. If your employer offers a Flexible Spending Account (FSA) or a Health Reimbursement Account (HRA), consider choosing these options. They can help you cover out-of-pocket healthcare expenses—and often include tax benefits for you.[6]
  • Write a Will
    According to a 2015 poll, nearly two-thirds of Americans do not have a will.[7] This important legal document helps ensure you name a guardian who will legally care for your child and that your assets go to the Special Needs Trust. If you do not have a will, a probate judge could make your child ineligible for federal benefits by naming him or her as a beneficiary of your assets. While services exist to help create a will on your own, we recommend that you work with a skilled attorney who understands the intricacies faced by families like yours.[8]

Raising a child with special needs may require additional planning. By putting your financial life in order now, you can focus on enjoying your time together as a family. To learn more about making the right financial decisions for your loved ones today, contact us any time. We are happy to help you make the most of your financial life.

Brad Connors
iWealth, Waseca MN

Footnotes, disclosures, and sources:

Securities and Advisory services offered through LPL Financial, a Registered Investment Advisor. Member FINRA/SIPC.

These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative, Broker dealer or Investment Advisor, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer or Investment Advisor gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

We have not independently verified the information available through the following links. The links are provided to you as a matter of interest. We make no claim as to their accuracy or reliability.

Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
[1] https://www.cdc.gov/ncbddd/developmentaldisabilities/about.html


[2] https://www.morganstanley.com/articles/special-needs-children


[3] http://kidshealth.org/en/parents/needs-planning.html#kha_24


[4] https://www.morganstanley.com/articles/special-needs-children


[5] http://kidshealth.org/en/parents/needs-planning.html#


[6] https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/2017-fsa-contribution-limits.aspx




[7] https://www.usatoday.com/story/money/personalfinance/2015/07/11/estate-plan-will/71270548/#


[8] http://kidshealth.org/en/parents/needs-planning.html#kha_12


Black Friday Brings Gains

Last week was a relatively quiet time in the domestic markets.  We did not receive a tremendous amount of economic data, and trading halted Thursday for the Thanksgiving holiday.  Nonetheless, all 3 major domestic indexes experienced sizable gains in only 4 trading days.  By Friday, the S&P 500 added 0.91% and closed above 2,600 for the first time in history.  The Dow was also up 0.86%, and the NASDAQ gained 1.57%.  International stocks in the MSCI EAFE had a 5-day trading week and grew by 1.85%.

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Stocks Mixed, Data Up

Domestic stock performances varied last week, with the S&P 500 and Dow losing ground for the 2nd straight week, while the NASDAQ posted gains.  By Friday, the S&P 500 had dropped 0.13%, the Dow gave back 0.27%, and the NASDAQ gained 0.47%.  International stocks in the MSCI EAFE stumbled, dropping 0.67%.

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Stocks Slide as Uncertainty Rises

After posting gains every week since September, U.S. stocks declined by market’s close on Friday.  The S&P 500 and Dow ended their longest stretch of weekly increases since 2013, and the NASDAQ ended its own 6-week streak.  By November 10, the S&P 500 declined 0.21%, the Dow was down 0.50%, and the NASDAQ slipped 0.20%.  Meanwhile, the MSCI EAFE dropped by 0.45%.

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Stocks End Up After Busy Week

Once again, the markets ended the week in positive territory-and all 3 major domestic indexes hit new record highs.  The S&P 500 added 0.26%, and the Dow was up 0.45%, with both indexes notching their 8th straight week of growth.  The NASDAQ was up for the 6th week in a row with a 0.94% gain.  International stocks in the MSCI EAFE joined in the growth, posting a 0.90% increase.

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Data Drives More Growth

Another week, another round of positive market performance. The 3 major domestic indexes again ended the week with gains and new record highs.  The S&P 500 rose 0.23% and marked a 7th-straight week of increases-its longest string of weekly gains in almost 3 years.  The Dow added 0.45%, and the NASDAQ grew by 1.09%.  Meanwhile, international stocks in the MSCI EAFE slipped slightly, losing 0.35% for the week.

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Another Banner Week for Markets

Last week, all 3 major U.S. markets hit record highs once again.  The Dow added 2.00% to notch both intraday and closing records, the S&P 500 rose 0.86%, and the NASDAQ gained 0.35%. International stocks in the MSCI EAFE dipped by 0.32% for the week.

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