Tax Season...And So It Begins!

It’s hard to believe, but we are already in the last two months of the year, and it is time to discuss year-end planning. November and December are actually the beginning of “tax season.” Important things to consider are deadlines for retirement plan distributions, Roth conversions, and charitable giving, just to name a few. I’d like to take this opportunity to remind our clients about some of these transactions and their deadlines.

Required Minimum Distributions: If you are 70 ½ or older, you are required by the Internal Revenue Service (IRS) to take a required minimum distribution (RMD) each year from your Traditional IRA, Rollover IRA, SEP IRA, or SIMPLE IRA. (Please note, owners of non-spouse Beneficiary IRAs and Beneficiary Roth IRAs have different requirements.) If you are turning 70 ½ in 2016, you have until 4-1-2017 to take your first RMD. Your second RMD must be taken by 12-31-2017. For all subsequent years, the RMD must be made by December 31. If you are already meeting your RMD requirement elsewhere, and therefore do not need to take a distribution from your account with LPL Financial, we would still like to discuss it with you to confirm that you have requested the distribution.

In order to ensure that we have time to process these distributions for you, we must have your signed distribution form(s) in place by 12-15-2016 for any distribution that must go out by 12-31-2016. We have already discussed the RMD process with most of our affected clients, but if you have any questions or if you need to confirm that your RMD has been satisfied, please contact us.

Roth Conversions: If you would like to discuss the possible benefits of converting your existing IRA(s) to a Roth IRA, please contact us to schedule a meeting to discuss this with Gib or John. If you do decide to process a Roth conversion, we must receive your completed request form by 12-15-16 in order to have the conversion completed by the 12-31-16 deadline. Traditional IRA account owners should consider the tax ramifications, age, and income restrictions in regards to executing a conversion from a Traditional IRA to a Roth IRA. The converted amount is generally subject to income taxation.

Charitable Gifting: Charitable giving is one way you can positively impact your current tax position. You may gift shares from an LPL Financial account to a third party as a charitable donation. To facilitate a year-end gifting request, please contact us on or before 11-11-2016, as LPL must receive signed instructions from you to ensure that the gifting of shares takes place and settles in the desired account by year-end. Any requests received on or after 11-12-2016 will be processed on a best efforts basis.

If you have any questions about the process for making these types of transactions, or other year-end transactions, please contact us at 336-544-6800. We are happy to help you check these items off your year-end “to-do” list so that you can relax and enjoy the more enjoyable year-end activities!



HMC Partners, Independent Advisor Alliance, and LPL Financial do not provide tax or legal advice.  The information contained in this report should be used for informational purposes only.  The appropriate professionals should be consulted on all legal and accounting regarding your personal planning.
Tax Season graphic courtesy of