He is Risen!
Today, my brothers and sisters, is Holy Saturday, the day after the darkest day in history and the day before the most important occurrence to ever take place on this earth. Holy Saturdayis a period of waiting and mourning, of not knowing what the future holds.
For the disciples, the hope that they had placed in this man called Jesus seemed misplaced; perhaps he was not the Savior after all. Holy Saturday is a day of tough questions, both then and now. "Are we crazy to call ourselves Christian?"; "Do I believe in Jesus?"; and "God, where are you?"
But thankfully, the day that changed everything is coming. On Easter Sunday, the stone was rolled away from the tomb and God's love made the final victory over death. Easter brings us the answer to all the questions the disciples asked on Holy Saturday and we ourselves ask countless times throughout our lives: He is risen! He is risen indeed!
Go in peace, friends. Easter is coming!
Blessings,
Ken Roney
President
WASHINGTON NEWS
How to Choose Your Tax Preparer
In IR-2016-46 the Service offered tips on selecting your tax preparer. If you would like assistance with your tax return due April 18, 2016, go to www.irs.gov/chooseataxpro.Read MoreWashington News
How to Choose Your Tax Preparer
In IR-2016-46 the Service offered tips on selecting your tax preparer. If you would like assistance with your tax return due April 18, 2016, go to www.irs.gov/chooseataxpro.
IRS Commissioner John Koskinen noted, “The filing of a federal income tax return represents one of the biggest financial transactions of the year for many Americans, whether they are getting a refund or paying tax due. Choose your tax return preparer carefully because you entrust them with your private financial information that needs to be protected.”
The IRS website covers three questions.
1. What kind of tax preparer do I need?All tax preparers must have an IRS Preparer Tax Identification Number (PTIN). Many tax preparers also may have additional specific skills. A tax preparer may be an enrolled agent (he or she must pass an IRS test), a certified public accountant (CPA) or a licensed attorney. You may find more information on the “credentials and qualifications” page on the IRS website.
2. How do you check a tax preparer’s credentials?The IRS maintains a “Directory of Federal Tax Return Preparers with Credentials and Select Qualifications.” You also may find additional information from your state or regional professional association. The professional associations offer background information on CPAs and attorneys.
3. What actions may you take if you have a complaint?The IRS webpage has a link with the title “Make a Complaint.” If you wish to proceed with a complaint, you will need to provide some basic information on the tax preparer.
Finally, there are best practices that you should follow. Your tax preparer must be an ethical person because he or she will have access to your personal financial data. The preparer must sign with his or her PTIN. You should always ask for permission to review the return. Feel free to ask your preparer questions if you have any areas that you don’t understand. Finally, never sign a blank tax return.
PERSONAL PLANNER
Loans and Sales to Children
Parents are frequently approached by children who desire loans for various purposes. Parents may make a loan to a child for the down payment on a home, Read MorePersonal Planner
Loans and Sales to Children
Parents are frequently approached by children who desire loans for various purposes. Parents may make a loan to a child for the down payment on a home, to start a new business, to cover costs for a personal emergency or for education.
One of the considerations for parents who make a loan is whether they are treating all children fairly. Most parents hope to treat their children equally. But the need for a loan will probably exist with one child and not with the others.
As a result, parents may consider making the loan to a child and then planning to forgive that loan in the estate plan. If this is the case, a parent frequently will create a similar benefit for other children in the estate plan. By forgiving the loan to one child and passing a similar benefit through the estate to the other children, everyone is treated fairly.
Family Loan Guidelines
An "oral agreement" family loan may cause serious conflict. Parents or children may forget the loan amount, the loan duration and the interest rate. Therefore, the loan document should be written.
It frequently is either a "demand" note or a term note. A term note is for a fixed number of years, in a manner similar to most notes for the mortgage on a home. A demand note allows the parent to request full payment at any time. Many family loans are made on demand notes and there may not be an expectation that the principal will be repaid.
Will There Be Taxes?
If the demand note does not require any interest or specifies an interest rate that is below the market rate, then there is assumed income to the parent. In effect, the child is treated as if he or she is making payments of the interest to the parent at the appropriate rate. Even though no interest may be paid, the parent will be required to report income in that amount. If the loan interest is deductible by the child, he or she may take that deduction.
With a no-interest demand note, the parent also is making a gift. However, the annual exclusion ($14,000 in 2016) is frequently sufficient to cover the gift of the parent in forgiving interest payments by the child. If there are two parents, the gift exclusion amount is doubled.
In many cases the note will be written at the applicable federal rate for the month it is created. The IRS publishes a revenue ruling each month with applicable rates for loans of various duration. So long as the note bears an interest rate at that rate, there will not be a gift.
It is beneficial if the child actually makes payments to the parent at the applicable interest rate each year. Even if the parent has used annual gift exclusions to provide funds to the child, a written note with payments by the child shows that the parents and child are treating the note in an appropriate businesslike manner. This makes it much more difficult for the IRS to claim that the principal value of the note was an immediate gift to the child.
Family Loan Exceptions
There are two general family loan exceptions. First, a loan of $10,000 or less is not covered by the "market interest rate" rules. A parent may make an interest-free loan of that amount without any impact.
Second, if the loan is from a parent to a child and is $100,000 or less, there may be another exception that reduces the amount of the assumed income interest reported by the parent. For these loans, the parent may report income that is the lower of the applicable federal rate or the child's actual net investment income for the year. This may reduce the income reported by the parent.
Mother Carol Helps Daughter Susan Purchase a Home
Mother Carol wanted to help daughter Susan purchase a home. Mother Carol lent Susan $100,000 on a written demand note. The applicable federal interest rate that month was 3.2%. Susan does not pay interest on the note and therefore Carol has assumed income. Her income each year is 3.2% or $3,200. In addition, Carol is making a gift of $3,200 to Susan each year. Fortunately, there is no gift tax because it is less than the annual gift exclusion amount.
If Susan records the $100,000 loan as a second mortgage against the home that she purchases, she will be able to deduct the $3,200 of income that Carol reports. However, because Susan is likely to be in a lower tax bracket, Carol will still pay a substantial tax that is likely to exceed Susan's tax savings.
Bill Helps Son Joe Start a Business
Bill would like to assist his son Joe who is starting a business. Bill lends Joe $50,000 on a demand note. The note requires an annual payment of 2.0%, which is the applicable federal rate on the date the note is created. Under the note terms, at the end of each year, Joe must pay $1,600 of interest to Bill.
Joe starts the business and makes the payment of $1,600 each year to Bill. Joe's CPA deducts the payment on Joe's tax return as an ordinary and necessary expense of the business.
Family Sales
There are a number of circumstances in which a parent may wish to sell real estate or stock in a family business to a child.
Many parents also choose to make gifts of land or stock to children. However, a parent may have already used the annual exclusion and his or her gift exemption. Alternatively, the parent may desire the economic security of payments on the property. Some parents prefer to sell assets to children and then have the payments available for retirement income.
Finally, a parent may give part of the land or stock to a child and then sell the balance. This transfer enables the child to own the investment or business. However, the child benefits from the self worth that results from the process of making payments on the note. While the child has been given part of the property or business, he or she has the self confidence that comes with making the business productive and paying on the note.
Installment Sale
Because children who purchase assets are frequently in the initial years of their careers, they usually lack the funds to purchase the entire property or stock in the business. As a result, it is quite common to use an installment sale.
From the perspective of a parent, the installment sale also has the benefit of spreading out the capital gain. He or she probably has a high level of appreciation in the land or stock. Using an installment sale will allow that gain to be recognized over a term of many years. Because the tax on the gain is not due until each portion is recognized, the total cost of the capital gains tax may be significantly reduced.
The parents also may be thinking of the impact on their estate plan. It may be quite desirable to "freeze" the value of a particular asset through an installment note. If the parents owned a parcel of land until they pass away, that property could greatly increase in value by the time of their death. However, if they freeze the value by selling it at a fair price on an installment note, then the growth in value of the land will benefit the children's estates.
Installment Sale Taxation
The primary benefit of an installment sale to the parent is that the capital gain is prorated. The CPA for the parent will develop a schedule showing the amount of the interest (which is ordinary income to the parent) and the amount of the capital gain each year. The payments by the children will be in part ordinary income on the interest portion and capital gain on that portion for the parent each year. If the parent has a tax basis in the property, a portion of each payment will be returned with no tax.
There is an important limitation on the installment sale to the child. If the parent transfers the property to the child, the child should not sell within two years. If the child were to sell the property prior to the two year limit, then in most cases the gain will immediately be taxed to the parent. Therefore, if a parent sells assets to a child on an installment note, the child should plan to hold the property for a minimum of two years.
Joe and Mary Sell to Daughter Linda
Joe and Mary have a commercial building and lot that is valued at $200,000. They have taken straight-line depreciation and the adjusted basis is now down to $20,000. They would like to sell this building to their daughter Linda. She will make payments to Joe and Mary and will immediately lease the building to a tenant who is waiting in the wings.
Because the applicable federal rate is 3%, Joe and Mary set up a 20 year installment sale to Linda using the 3% interest rate.
Each year, Linda will make a payment of the interest plus principal as set forth in the note that has been developed by the family's CPA. Joe and Mary will report the interest as ordinary income and a portion of the capital gain. Their prorated part of the $20,000 of basis is tax free. Because Linda plans to hold the building and will not sell within two years, there will be no acceleration of the capital gain for Joe and Mary.
Joe and Mary also considered other options with their CPA. One possibility is for there to be a provision in the 20 year note that would eliminate the debt if both Mary and Joe pass away prior to the end of 20 years. This provision to cancel the debt if the parents die early is called a "self-canceling installment note."
Another option is to use an alternative to the installment note called a private annuity. With the private annuity, Joe and Mary would receive payments from Linda for their lifetimes, rather than the fixed term of the installment note.
After discussing these two other concepts with their CPA, Joe and Mary decided to use the 20-year installment note. This will freeze the value and gives Linda a clear picture of the payment amounts and schedule.
SAVVY LIVING
Elder Mediation Can Help Families Resolve Caregiving Conflicts
Are there any services that you know of that help families resolve caregiving conflicts? My mother - who just turned 82 - recently had a stroke, and to make matters worse, my two siblings and I have been perpetually arguing about how to handle her caregiving... Read MoreSavvy Living
Elder Mediation Can Help Families Resolve Caregiving Conflicts
Are there any services that you know of that help families resolve caregiving conflicts? My mother - who just turned 82 - recently had a stroke, and to make matters worse, my two siblings and I have been perpetually arguing about how to handle her caregiving needs and finances.
It's not unusual for adult children to disagree with each other regarding the care of an elder parent. If your siblings are willing, a good possible solution is to hire an "elder care mediator" who can help you work through your disagreements peacefully. Here's what you need to know.
Elder Mediation
While mediators have been used for years to help divorcing couples sort out legal and financial disagreements and avoid court battles, elder care mediation is relatively new. It is a specialized service designed to help families resolve disputes that are related to aging parents or other elderly relatives.
Family disagreements over an ill or elderly parent's caregiving needs, living arrangements, financial decisions and medical care are some of the many issues that an elder care mediator can help with. But don't confuse this with family or group therapy. Mediation is focused on decision-making, not feelings and emotions.
The job of an elder mediator is to step in as a neutral third-party to help ease family tensions, listen to everyone's concerns, hash out disagreements or misunderstandings and help your family make decisions that are acceptable to everyone.
Good mediators can also connect you with experts, such as estate-planners, geriatric care managers, healthcare professional and financial experts who can supply important information for family decision-making.
Your family also needs to know that the mediation process is completely confidential and voluntary. It can take anywhere from a few hours to several meetings depending on the complexity of your issues. Also, if some family members live far away, a conference or video call can be used to bring everyone together.
If you're interested in hiring a private elder care mediator, you can expect to pay anywhere from $100 to more than $500 per hour depending on where you live and who you choose. Alternatively, you may be able to get help through a nonprofit community mediation service that charges little to nothing.
Finding a Mediator
To locate an elder mediator, start by contacting your area aging agency, which may be able to refer you to local resources (call 800-677-1116 to obtain your local number). You can also search for your area agency online at Mediate.com. Another good option is the National Association for Community Mediation website (nafcm.org), which can help you search for free or low cost community-based mediation programs in your area.
Unfortunately, there is currently no formal licensing or national credentialing required for elder mediators, so make sure the person you choose has extensive experience with elder issues that are similar to what your family is dealing with. Also, be sure you ask for references and check them. Most elder mediators are attorneys, social workers, counselors or other professionals who are trained in mediation and conflict resolution.
Savvy Living is written by Jim Miller, a regular contributor to the NBC Today Show and author of "The Savvy Living” book. Any links in this article are offered as a service and there is no endorsement of any product. These articles are offered as a helpful and informative service to our friends and may not always reflect this organization’s official position on some topics. Jim invites you to send your senior questions to: Savvy Living, P.O. Box 5443, Norman, OK 73070.
YOUR PLAN
Deferred Gift Annuity
Several years ago Larry and Allison invested $30,000 in what they believed to be an attractive stock. It turned out to be a very wise decision. Read MoreDeferred Gift Annuity
Larry and Allison invested $30,000 in what they believed to be an attractive stock. This turned out to be a very wise decision, because the value of the stock increased to $100,000 a few years later. Though they were not in need of additional income at the time, the couple decided to cash in on this growth and began considering selling the stock.
Allison: "It had been a good year for us, and we were looking for ways to maximize deductions and reduce what we owed in taxes. At the same time, we really felt God tugging on our hearts to make a contribution to the missionary work being done through Nazarene Global Missions and Nazarene Missions International."
Larry: "Allison and I were both age 50 at the time, in good health and still working. And though we didn't really need extra current income, we were planning to retire at age 65 so we were always interested in smart retirement planning. Our goal was to be able to live comfortably and travel in our motorhome to visit friends and family."
Allison: "We met with a Foundation representative, and he told us that what would work best for our situation is a deferred gift annuity. We could give the stock immediately to the Foundation and receive the tax benefits, but the annuity wouldn't begin until we retired. We would then receive annual income payments from the annuity for the rest of our life, and the remainder would go to Global Missions when both of us passed away."
Larry: "We decided to go ahead and set up a deferred gift annuity. We experienced firsthand each of the benefits they mentioned, so now we are receiving income and know that our money will be used for the work of the Lord when we no longer need it."
**Note: The name and image above is representative of a typical donor and may or may not be an actual donor to our organization. Since your benefits may be different, please contact us for more information.
FINANCES
Today, my brothers and sisters, is Holy Saturday, the day after the darkest day in history and the day before the most important occurrence to ever take place on this earth. Holy Saturdayis a period of waiting and mourning, of not knowing what the future holds.
For the disciples, the hope that they had placed in this man called Jesus seemed misplaced; perhaps he was not the Savior after all. Holy Saturday is a day of tough questions, both then and now. "Are we crazy to call ourselves Christian?"; "Do I believe in Jesus?"; and "God, where are you?"
But thankfully, the day that changed everything is coming. On Easter Sunday, the stone was rolled away from the tomb and God's love made the final victory over death. Easter brings us the answer to all the questions the disciples asked on Holy Saturday and we ourselves ask countless times throughout our lives: He is risen! He is risen indeed!
Go in peace, friends. Easter is coming!
Blessings,
Ken Roney
President
WASHINGTON NEWS
How to Choose Your Tax Preparer
In IR-2016-46 the Service offered tips on selecting your tax preparer. If you would like assistance with your tax return due April 18, 2016, go to www.irs.gov/chooseataxpro.Read MoreWashington News
How to Choose Your Tax Preparer
In IR-2016-46 the Service offered tips on selecting your tax preparer. If you would like assistance with your tax return due April 18, 2016, go to www.irs.gov/chooseataxpro.
IRS Commissioner John Koskinen noted, “The filing of a federal income tax return represents one of the biggest financial transactions of the year for many Americans, whether they are getting a refund or paying tax due. Choose your tax return preparer carefully because you entrust them with your private financial information that needs to be protected.”
The IRS website covers three questions.
1. What kind of tax preparer do I need?All tax preparers must have an IRS Preparer Tax Identification Number (PTIN). Many tax preparers also may have additional specific skills. A tax preparer may be an enrolled agent (he or she must pass an IRS test), a certified public accountant (CPA) or a licensed attorney. You may find more information on the “credentials and qualifications” page on the IRS website.
2. How do you check a tax preparer’s credentials?The IRS maintains a “Directory of Federal Tax Return Preparers with Credentials and Select Qualifications.” You also may find additional information from your state or regional professional association. The professional associations offer background information on CPAs and attorneys.
3. What actions may you take if you have a complaint?The IRS webpage has a link with the title “Make a Complaint.” If you wish to proceed with a complaint, you will need to provide some basic information on the tax preparer.
Finally, there are best practices that you should follow. Your tax preparer must be an ethical person because he or she will have access to your personal financial data. The preparer must sign with his or her PTIN. You should always ask for permission to review the return. Feel free to ask your preparer questions if you have any areas that you don’t understand. Finally, never sign a blank tax return.
PERSONAL PLANNER
Loans and Sales to Children
Parents are frequently approached by children who desire loans for various purposes. Parents may make a loan to a child for the down payment on a home, Read MorePersonal Planner
Loans and Sales to Children
Parents are frequently approached by children who desire loans for various purposes. Parents may make a loan to a child for the down payment on a home, to start a new business, to cover costs for a personal emergency or for education.
One of the considerations for parents who make a loan is whether they are treating all children fairly. Most parents hope to treat their children equally. But the need for a loan will probably exist with one child and not with the others.
As a result, parents may consider making the loan to a child and then planning to forgive that loan in the estate plan. If this is the case, a parent frequently will create a similar benefit for other children in the estate plan. By forgiving the loan to one child and passing a similar benefit through the estate to the other children, everyone is treated fairly.
Family Loan Guidelines
An "oral agreement" family loan may cause serious conflict. Parents or children may forget the loan amount, the loan duration and the interest rate. Therefore, the loan document should be written.
It frequently is either a "demand" note or a term note. A term note is for a fixed number of years, in a manner similar to most notes for the mortgage on a home. A demand note allows the parent to request full payment at any time. Many family loans are made on demand notes and there may not be an expectation that the principal will be repaid.
Will There Be Taxes?
If the demand note does not require any interest or specifies an interest rate that is below the market rate, then there is assumed income to the parent. In effect, the child is treated as if he or she is making payments of the interest to the parent at the appropriate rate. Even though no interest may be paid, the parent will be required to report income in that amount. If the loan interest is deductible by the child, he or she may take that deduction.
With a no-interest demand note, the parent also is making a gift. However, the annual exclusion ($14,000 in 2016) is frequently sufficient to cover the gift of the parent in forgiving interest payments by the child. If there are two parents, the gift exclusion amount is doubled.
In many cases the note will be written at the applicable federal rate for the month it is created. The IRS publishes a revenue ruling each month with applicable rates for loans of various duration. So long as the note bears an interest rate at that rate, there will not be a gift.
It is beneficial if the child actually makes payments to the parent at the applicable interest rate each year. Even if the parent has used annual gift exclusions to provide funds to the child, a written note with payments by the child shows that the parents and child are treating the note in an appropriate businesslike manner. This makes it much more difficult for the IRS to claim that the principal value of the note was an immediate gift to the child.
Family Loan Exceptions
There are two general family loan exceptions. First, a loan of $10,000 or less is not covered by the "market interest rate" rules. A parent may make an interest-free loan of that amount without any impact.
Second, if the loan is from a parent to a child and is $100,000 or less, there may be another exception that reduces the amount of the assumed income interest reported by the parent. For these loans, the parent may report income that is the lower of the applicable federal rate or the child's actual net investment income for the year. This may reduce the income reported by the parent.
Mother Carol Helps Daughter Susan Purchase a Home
Mother Carol wanted to help daughter Susan purchase a home. Mother Carol lent Susan $100,000 on a written demand note. The applicable federal interest rate that month was 3.2%. Susan does not pay interest on the note and therefore Carol has assumed income. Her income each year is 3.2% or $3,200. In addition, Carol is making a gift of $3,200 to Susan each year. Fortunately, there is no gift tax because it is less than the annual gift exclusion amount.
If Susan records the $100,000 loan as a second mortgage against the home that she purchases, she will be able to deduct the $3,200 of income that Carol reports. However, because Susan is likely to be in a lower tax bracket, Carol will still pay a substantial tax that is likely to exceed Susan's tax savings.
Bill Helps Son Joe Start a Business
Bill would like to assist his son Joe who is starting a business. Bill lends Joe $50,000 on a demand note. The note requires an annual payment of 2.0%, which is the applicable federal rate on the date the note is created. Under the note terms, at the end of each year, Joe must pay $1,600 of interest to Bill.
Joe starts the business and makes the payment of $1,600 each year to Bill. Joe's CPA deducts the payment on Joe's tax return as an ordinary and necessary expense of the business.
Family Sales
There are a number of circumstances in which a parent may wish to sell real estate or stock in a family business to a child.
Many parents also choose to make gifts of land or stock to children. However, a parent may have already used the annual exclusion and his or her gift exemption. Alternatively, the parent may desire the economic security of payments on the property. Some parents prefer to sell assets to children and then have the payments available for retirement income.
Finally, a parent may give part of the land or stock to a child and then sell the balance. This transfer enables the child to own the investment or business. However, the child benefits from the self worth that results from the process of making payments on the note. While the child has been given part of the property or business, he or she has the self confidence that comes with making the business productive and paying on the note.
Installment Sale
Because children who purchase assets are frequently in the initial years of their careers, they usually lack the funds to purchase the entire property or stock in the business. As a result, it is quite common to use an installment sale.
From the perspective of a parent, the installment sale also has the benefit of spreading out the capital gain. He or she probably has a high level of appreciation in the land or stock. Using an installment sale will allow that gain to be recognized over a term of many years. Because the tax on the gain is not due until each portion is recognized, the total cost of the capital gains tax may be significantly reduced.
The parents also may be thinking of the impact on their estate plan. It may be quite desirable to "freeze" the value of a particular asset through an installment note. If the parents owned a parcel of land until they pass away, that property could greatly increase in value by the time of their death. However, if they freeze the value by selling it at a fair price on an installment note, then the growth in value of the land will benefit the children's estates.
Installment Sale Taxation
The primary benefit of an installment sale to the parent is that the capital gain is prorated. The CPA for the parent will develop a schedule showing the amount of the interest (which is ordinary income to the parent) and the amount of the capital gain each year. The payments by the children will be in part ordinary income on the interest portion and capital gain on that portion for the parent each year. If the parent has a tax basis in the property, a portion of each payment will be returned with no tax.
There is an important limitation on the installment sale to the child. If the parent transfers the property to the child, the child should not sell within two years. If the child were to sell the property prior to the two year limit, then in most cases the gain will immediately be taxed to the parent. Therefore, if a parent sells assets to a child on an installment note, the child should plan to hold the property for a minimum of two years.
Joe and Mary Sell to Daughter Linda
Joe and Mary have a commercial building and lot that is valued at $200,000. They have taken straight-line depreciation and the adjusted basis is now down to $20,000. They would like to sell this building to their daughter Linda. She will make payments to Joe and Mary and will immediately lease the building to a tenant who is waiting in the wings.
Because the applicable federal rate is 3%, Joe and Mary set up a 20 year installment sale to Linda using the 3% interest rate.
Each year, Linda will make a payment of the interest plus principal as set forth in the note that has been developed by the family's CPA. Joe and Mary will report the interest as ordinary income and a portion of the capital gain. Their prorated part of the $20,000 of basis is tax free. Because Linda plans to hold the building and will not sell within two years, there will be no acceleration of the capital gain for Joe and Mary.
Joe and Mary also considered other options with their CPA. One possibility is for there to be a provision in the 20 year note that would eliminate the debt if both Mary and Joe pass away prior to the end of 20 years. This provision to cancel the debt if the parents die early is called a "self-canceling installment note."
Another option is to use an alternative to the installment note called a private annuity. With the private annuity, Joe and Mary would receive payments from Linda for their lifetimes, rather than the fixed term of the installment note.
After discussing these two other concepts with their CPA, Joe and Mary decided to use the 20-year installment note. This will freeze the value and gives Linda a clear picture of the payment amounts and schedule.
SAVVY LIVING
Elder Mediation Can Help Families Resolve Caregiving Conflicts
Are there any services that you know of that help families resolve caregiving conflicts? My mother - who just turned 82 - recently had a stroke, and to make matters worse, my two siblings and I have been perpetually arguing about how to handle her caregiving... Read MoreSavvy Living
Elder Mediation Can Help Families Resolve Caregiving Conflicts
Are there any services that you know of that help families resolve caregiving conflicts? My mother - who just turned 82 - recently had a stroke, and to make matters worse, my two siblings and I have been perpetually arguing about how to handle her caregiving needs and finances.
It's not unusual for adult children to disagree with each other regarding the care of an elder parent. If your siblings are willing, a good possible solution is to hire an "elder care mediator" who can help you work through your disagreements peacefully. Here's what you need to know.
Elder Mediation
While mediators have been used for years to help divorcing couples sort out legal and financial disagreements and avoid court battles, elder care mediation is relatively new. It is a specialized service designed to help families resolve disputes that are related to aging parents or other elderly relatives.
Family disagreements over an ill or elderly parent's caregiving needs, living arrangements, financial decisions and medical care are some of the many issues that an elder care mediator can help with. But don't confuse this with family or group therapy. Mediation is focused on decision-making, not feelings and emotions.
The job of an elder mediator is to step in as a neutral third-party to help ease family tensions, listen to everyone's concerns, hash out disagreements or misunderstandings and help your family make decisions that are acceptable to everyone.
Good mediators can also connect you with experts, such as estate-planners, geriatric care managers, healthcare professional and financial experts who can supply important information for family decision-making.
Your family also needs to know that the mediation process is completely confidential and voluntary. It can take anywhere from a few hours to several meetings depending on the complexity of your issues. Also, if some family members live far away, a conference or video call can be used to bring everyone together.
If you're interested in hiring a private elder care mediator, you can expect to pay anywhere from $100 to more than $500 per hour depending on where you live and who you choose. Alternatively, you may be able to get help through a nonprofit community mediation service that charges little to nothing.
Finding a Mediator
To locate an elder mediator, start by contacting your area aging agency, which may be able to refer you to local resources (call 800-677-1116 to obtain your local number). You can also search for your area agency online at Mediate.com. Another good option is the National Association for Community Mediation website (nafcm.org), which can help you search for free or low cost community-based mediation programs in your area.
Unfortunately, there is currently no formal licensing or national credentialing required for elder mediators, so make sure the person you choose has extensive experience with elder issues that are similar to what your family is dealing with. Also, be sure you ask for references and check them. Most elder mediators are attorneys, social workers, counselors or other professionals who are trained in mediation and conflict resolution.
Savvy Living is written by Jim Miller, a regular contributor to the NBC Today Show and author of "The Savvy Living” book. Any links in this article are offered as a service and there is no endorsement of any product. These articles are offered as a helpful and informative service to our friends and may not always reflect this organization’s official position on some topics. Jim invites you to send your senior questions to: Savvy Living, P.O. Box 5443, Norman, OK 73070.
YOUR PLAN
Deferred Gift Annuity
Several years ago Larry and Allison invested $30,000 in what they believed to be an attractive stock. It turned out to be a very wise decision. Read MoreDeferred Gift Annuity
Larry and Allison invested $30,000 in what they believed to be an attractive stock. This turned out to be a very wise decision, because the value of the stock increased to $100,000 a few years later. Though they were not in need of additional income at the time, the couple decided to cash in on this growth and began considering selling the stock.
Allison: "It had been a good year for us, and we were looking for ways to maximize deductions and reduce what we owed in taxes. At the same time, we really felt God tugging on our hearts to make a contribution to the missionary work being done through Nazarene Global Missions and Nazarene Missions International."
Larry: "Allison and I were both age 50 at the time, in good health and still working. And though we didn't really need extra current income, we were planning to retire at age 65 so we were always interested in smart retirement planning. Our goal was to be able to live comfortably and travel in our motorhome to visit friends and family."
Allison: "We met with a Foundation representative, and he told us that what would work best for our situation is a deferred gift annuity. We could give the stock immediately to the Foundation and receive the tax benefits, but the annuity wouldn't begin until we retired. We would then receive annual income payments from the annuity for the rest of our life, and the remainder would go to Global Missions when both of us passed away."
Larry: "We decided to go ahead and set up a deferred gift annuity. We experienced firsthand each of the benefits they mentioned, so now we are receiving income and know that our money will be used for the work of the Lord when we no longer need it."
**Note: The name and image above is representative of a typical donor and may or may not be an actual donor to our organization. Since your benefits may be different, please contact us for more information.
FINANCES
Stocks - Nike Reports Strong Earnings Read More
Nike Reports Strong EarningsNike, Inc. (NKE) released its quarterly earnings report on Tuesday, March 22. The company reported strong earnings but weaker than expected revenue.
The sportswear company reported revenue of $8 billion for the quarter. Analysts expected revenue closer to $8.2 billion. On a currency neutral basis, however, revenue rose 14% from a year ago.
"In the third quarter, Nike delivered robust and balanced growth across our expansive, powerful portfolio," said Nike CEO and President Mark Parker. "We grow by serving the athlete personally every day and, as we unveiled last week, through breakthrough innovation that gives us a foundation for growth for years to come."
Net income for the quarter was $950 million, or $0.55 per share. This is an increase of 20% from $791 million, or $0.45 per share during the same quarter last year.
The Oregon-based athletic-wear company continues to find new ways to grow in the face of ever-increasing competition in the sportswear industry. Earlier this week, Nike revealed information about its long-awaited self-lacing shoe. Known as the HyperAdapt 1.0, the shoe will feature a sensor that will automatically tighten the shoe to the preferred level of tension once it is on the user's foot. The product comes after decades of speculation ever since a similar product appeared in the 1989 film Back to the Future Part II.
Nike, Inc. (NKE) shares ended the week at $61.65, down 2.9% for the week.
Krispy Kreme Performance Lukewarm
Krispy Kreme Doughnuts, Inc. (KKD) released its quarterly earnings on Tuesday, March 22. The doughnut chain missed analysts' expectations for revenue and profits.
The company reported revenue of $130 million, an increase of 4% from $125 million during the same quarter last year.
"We believe fiscal 2017 will be another year of sustainable growth as we partner with new and existing franchisees to spread the joy of Krispy Kreme throughout the world," said Krispy Kreme President and CEO Tony Thompson. "As part of these efforts, we are refining our retail store model to deliver better returns while executing on our four key business drivers: accelerating global growth; leveraging technology; enhancing our core menu; and maximizing brand awareness. We remain excited about our brand's long-term potential and believe we are well positioned to drive earnings and cash flow growth in the future."
The company reported a profit of $32.4 million, or $0.48 per share for the quarter. During the same quarter last year, the company reported $30.1 million, or $0.44 per share.
The company's international franchise revenue was hit hard this quarter with a year-over-year decrease of 3.4%. International sales, likewise, dropped 4% from the prior year. The company has attributed these declines to unfavorable exchange rates abroad. Conversely, the doughnut chain's domestic franchise revenue and sales increased 24% and 9% respectively from the prior year.
Krispy Kreme Doughnuts (KKD) shares ended the week at $14.61, down 7.8% for the week.
General Mills Reports Earnings
General Mills (GIS) reported its quarterly earnings on Wednesday, March 23. The company's reported higher-than-expected net income but missed revenue projections.
The cereal maker reported net sales of $4 billion. This is a drop of 8% from $4.35 billion during the same quarter last year.
"Our third quarter financial results were in line with our expectations," said Ken Powell, Chairman and CEO of General Mills. "We reported a decline in net sales as anticipated, primarily reflecting the Green Giant divestiture and continued foreign exchange headwinds. Constant-currency segment operating profit was down modestly, as our cost savings efforts more than offset the impact of the Green Giant sale."
The company reported net income of $361.7 million, or $0.59 per share. During the same quarter a year ago, net income was $343 million, or $0.56 per share.
Many consumers are moving away from processed breakfast foods in favor of fresher options. General Mills, known for its popular cereals such as Cheerios, Wheaties and Chex, has kicked into cost cutting mode to stave off the effects of these changes in customer buying habits. Additionally, the company has begun to tailor its products to appeal to today's more health-conscious consumer.
General Mills (GIS) shares ended the week at $61.36, virtually unchanged for the week.
The Dow started the week of 3/21 at 17,590 and closed at 17,516 on 3/24. The S&P 500 started the week at 2,048 and closed at 2,035. The NASDAQ started the week at 4,787 and closed at 4,774.
Bonds - Treasury Bond Prices Rise Read More
Treasury Bond Prices RiseU.S. Treasury bond prices rose nearing the end of the week, sending yields down. Many investors are moving to less risky investments going into the holiday weekend.
Last week, Federal Reserve Chairwoman Janet Yellen announced that the Fed would be backing off of its plan to raise rates. Yellen emphasized, however, that the Fed was not reversing course, but merely slowing the process down. "What you see here is a virtually unchanged path of economic projections and a slightly more accommodative path," said Yellen.
Despite Yellen's announcement, many still believe another rate hike may be coming next month. "There is sufficient momentum evidenced by the economic data to justify a further step at one of the coming meetings, possibly as early as the meeting scheduled for the end of April," said Dennis Lockhart, President of the Federal Reserve Bank of Atlanta.
These mixed signals from Fed officials along with recent instability in oil prices are just two of many indicators that have driven investors to the conclusion that it is not yet time to shift away from treasury bonds to riskier investments.
The 10-year Treasury note yield finished the week of 3/21 at 1.9% while the 30-year Treasury note yield was 2.67%.
CDs and Mortgages - Interest Rates Fall Read More
Interest Rates Fall
Freddie Mac released the latest Primary Mortgage Market Survey (PMMS) on Thursday, March 24, 2016. Mortgage interest rates dropped this week for the first time in a month.
The 30-year fixed rate mortgage averaged 3.71% for the week. This is down from last week's average of 3.73% This time last year, the 30-year fixed rate mortgage averaged 3.69%.
The 15-year fixed rate mortgage averaged 2.96%. This represents decrease from last week when it averaged 2.99%. The 15-year fixed rate mortgage averaged 2.97% one year ago.
"The Federal Reserve's decision last week to maintain the current level of the Federal funds rate combined with the reduction in their forecast for growth triggered a 3-basis point drop in the 10-year Treasury yield," said Sean Becketti, Chief Economist at Freddie Mac. "As a consequence, the 30-year mortgage rate declined 2 basis points to 3.71%."
The money market fund finished the week of 3/21 at 0.3%. The 1-year CD finished at 0.6%.
Freddie Mac released the latest Primary Mortgage Market Survey (PMMS) on Thursday, March 24, 2016. Mortgage interest rates dropped this week for the first time in a month.
The 30-year fixed rate mortgage averaged 3.71% for the week. This is down from last week's average of 3.73% This time last year, the 30-year fixed rate mortgage averaged 3.69%.
The 15-year fixed rate mortgage averaged 2.96%. This represents decrease from last week when it averaged 2.99%. The 15-year fixed rate mortgage averaged 2.97% one year ago.
"The Federal Reserve's decision last week to maintain the current level of the Federal funds rate combined with the reduction in their forecast for growth triggered a 3-basis point drop in the 10-year Treasury yield," said Sean Becketti, Chief Economist at Freddie Mac. "As a consequence, the 30-year mortgage rate declined 2 basis points to 3.71%."
The money market fund finished the week of 3/21 at 0.3%. The 1-year CD finished at 0.6%.
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To model generosity inspires others to do the same. Thank you for your interest in the Foundation as we strive to partner with churches, ministries, and Christians around the world to fund the important work of God's Kingdom.
To access updated financial and gift planning information, please visit our website, www.nazarenefoundation.org. If you would like more information about your charitable giving options or about how a Foundation representative can visit your church, contact us by phone at (913) 577-2983 or by email at info@nazarenefoundation.org.
The Global Church of the Nazarene Foundation
To model generosity inspires others to do the same. Thank you for your interest in the Foundation as we strive to partner with churches, ministries, and Christians around the world to fund the important work of God's Kingdom.
To access updated financial and gift planning information, please visit our website, www.nazarenefoundation.org. If you would like more information about your charitable giving options or about how a Foundation representative can visit your church, contact us by phone at (913) 577-2983 or by email at info@nazarenefoundation.org.
The Global Church of the Nazarene Foundation
17001 Prairie Star Parkway, Suite 200
Lenexa, Kansas 66220, United States
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