2009 and 2010 bring a slew of changes to the structure of tax credits and deductions in the Federal Income Tax system. Today I would like to draw attention to the American Opportunity Tax Credit. The American Opportunity Credit expanded and renamed the Hope Credit for tax years 2009 and 2010. The expanded credit increases the total available credit to $2,500 per year for the first four years of post secondary education. This is an increase of $700 over the old Hope Credit. The Hope Credit was also only applicable to the first two years of school. Adding $700 per year and an additional two years to eligibility make the new credit worth up to an additional Read more
Have You Changed all Your Beneficiary Designations?
In January 2009; the U.S. Supreme Court ruled (Kennedy v. DuPont Plan Administrator) against a woman suing her late father’s pension plan for money her mother received, even thought the mother had forfeited her rights to the pension in their 1994 divorce. The Supreme Court determined the beneficiary designation form and the procedures set under the plan were sole determinants of benefit distribution.
Employers are required to pay benefits as stated in the original beneficiary designation form, in spite of a divorce decree.
It is important for all divorcing individuals to revisit their estate planning, including beneficiary designations, wills and trusts. Changes must be made to retirement plans in accordance with the rules set forth by respective employers. Otherwise, children and/or new spouses may not be eligible to receive benefits.
Remember the following points: Read more
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