ATTENTION: Important Information for Owners of Corporations, LLC’s, and Other Business Entities

Contributed by: Michael Brocavich, CFP®, MBA

Corporate Transparency Act (CTA) - Report beneficial ownership information to FinCEN by January 1, 2025

Why was this reporting requirement imposed?

The CTA is mainly an anti-money laundering law and was enacted by Congress to protect national interests and better enable efforts to counter illegal acts. Entities that qualify will have to report information to the Financial Crimes Enforcement Network (FinCEN) by January 1, 2025. FinCEN is part of the U.S. Department of Treasury.

Who is impacted?

Every corporation, LLC, or other entity created by the filing of a document with a Secretary of State or similar office under the law of a state or Indian tribe.

What information do I need to provide?

To complete the filing through FinCEN, the below information is required:

• Information about the company: Name, EIN, business address, and incorporation date

• Information about the company’s beneficial owners: Name, address, and photo documentation of a driver’s license or passport

What do I need to do?

Report the required information to FinCEN before the January 1, 2025, deadline by using FinCEN’s BOI e-filing website. You are able to report this information directly to FinCEN at no charge, or you can authorize an accountant to file on your behalf.

For those that have created an entity this year, there is a requirement to file within 90 days of creation. 

What resources are available?

The following resources are available through FinCEN’s website:

• FAQs

• Small entity compliance guide

• Quick reference guide

What happens next?

We’re aware of the pending legal challenges related to the CTA, including the recent ruling by the U.S. District Court for the District of Alabama. Under our understanding, the CTA reporting requirements still stand as-is.

Questions?

If you have any questions about the requirements for your specific situation, we encourage you to consult with your attorney.

Michael Brocavich, CFP®, MBA is a CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® He has an extensive background in both personal and corporate finance.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Michael Brocavich and not necessarily those of Raymond James.

Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Center for Financial Planning, Inc® Center for Financial Planning, Inc.® is not a registered broker/dealer and is independent of Raymond James Financial Services.

DTE Announces Buyout Offer

Contributed by: Michael Brocavich, CFP®, MBA

DTE has recently offered buyouts to 3,000 employees’, which is about 30% of its total workforce.  Employees that are eligible will receive an offer and be under a deadline to determine if they will accept the offer.

If you, friends, family members, or colleagues have recently received a buy-out offer from DTE or any other company and would like to discuss the details with one of our team’s Certified Financial Planners, please feel free to reach out, and we’d be happy to arrange a time to chat. Our team has nearly four decades of experience helping clients navigate significant life transitions such as this – we’d be honored to serve as a resource for you. 

Also, if you would like to attend a live seminar about this buyout and what you should consider when making this decision, please look out for an invitation to a live event at the end of February. 

Office Line: 248-948-7900

Website Contact Inquiry: https://www.centerfinplan.com/contact 

If you’d like to receive a copy of our “Should I roll over my 401k to an IRA?” checklist, please click HERE! 

Source: https://www.freep.com/story/money/business/michigan/2024/01/10/dte-energy-buyout-offer-voluntary-separation-incentive-employees/72173895007/

CENTER FOR FINANCIAL PLANNING, INC is not affiliated with DTE Energy.

Michael Brocavich, CFP®, MBA is a CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® He has an extensive background in both personal and corporate finance.

The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Please note, changes in tax laws may occur at any time and could have a substantial impact upon each person's situation. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional.

Toyota Announces Buyout Offer

Contributed by: Michael Brocavich, CFP®, MBA

Toyota North America recently offered some employees a voluntary severance package. Employees received offers dated December 11th, 2023, and must apply for the offer and have received an acceptance or rejection by January 25th. Not all employees will be able to qualify, and the offer is very limited compared to other recent offers from the Detroit Big Three. 

Employees who are approved for the severance offer will receive payments based on salary and years of service. Employees with 15 years or greater of service could receive up to two times their salary. Employees with years of service between 10 and 14 years could receive up to a year and a half of salary, while employees with five years of service to nine years could get up to one full year of salary.  

Over the past several years, the ‘Big Three’ have all offered similar buyouts, and many of our clients have come to us for guidance to ensure they make an informed decision. Above is a webinar recently hosted by partner and Senior Financial Planner Nick Defenthaler, CFP®, RICP®. During this educational session, Nick discusses five important considerations when going through a layoff or a recent job transition: 

Timestamps:

• Cash Flow Planning - 6:01

• Health Care & Insurance Guidance - 11:49

• Tax Considerations - 18:19

• Retirement Account & Pension Decisions - 23:41

• Putting It All Together - 35:21

If you, friends, family members, or colleagues have recently received a buy-out offer from Toyota North America and would like to discuss the details with one of our team’s Certified Financial Planners, please feel free to reach out, and we’d be happy to arrange a time to chat. Our team has nearly four decades of experience helping clients navigate significant life transitions such as this – we’d be honored to serve as a resource for you. 

Office Line: 248-948-7900

Website Contact Inquiry: https://www.centerfinplan.com/contact 

If you’d like to receive a copy of our “Should I roll over my 401k to an IRA?” checklist, please click HERE!

CENTER FOR FINANCIAL PLANNING, INC is not affiliated with Toyota North America.

Michael Brocavich, CFP®, MBA is a CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® He has an extensive background in both personal and corporate finance.

The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Please note, changes in tax laws may occur at any time and could have a substantial impact upon each person's situation. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional. Unless certain criteria are met, Roth IRA owners must be 59½ or older and have held the IRA for five years before tax-free withdrawals are permitted. Additionally, each converted amount may be subject to its own five-year holding period. Converting a traditional IRA into a Roth IRA has tax implications. Investors should consult a tax advisor before deciding to do a conversion.

Stellantis Announces Buyout Offer

Contributed by: Nick Defenthaler, CFP®, RICP®

Stellanits, the European automaker that builds vehicles for the US market under Jeep, Ram, Dodge, and Chrysler brands, recently announced that it is offering buyouts to half of its salaried US staff in a cost-cutting move. Over the past several years, the ‘Big 3’ have all offered similar buyouts, and many of our clients have come to us for guidance to ensure they make an informed decision. Above is a webinar recently hosted by partner and Senior Financial Planner Nick Defenthaler, CFP®, RICP®. During this educational session, Nick discusses five important considerations when going through a layoff or a recent job transition: 

Timestamps:

• Cash Flow Planning - 6:01

• Health Care & Insurance Guidance - 11:49

• Tax Considerations - 18:19

• Retirement Account & Pension Decisions - 23:41

• Putting It All Together - 35:21

If you, friends, family members, or colleagues have recently received a buy-out offer from Stellantis and would like to discuss the details with one of our team’s Certified Financial Planners, please feel free to reach out, and we’d be happy to arrange a time to chat. Our team has nearly four decades of experience helping clients navigate significant life transitions such as this – we’d be honored to serve as a resource for you. 

Office Line: 248-948-7900

Website Contact Inquiry: https://www.centerfinplan.com/contact 

If you’d like to receive a copy of our “Should I roll over my 401k to an IRA?” checklist, please click HERE! 

Nick Defenthaler, CFP®, RICP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® Nick specializes in tax-efficient retirement income and distribution planning for clients and serves as a trusted source for local and national media publications, including WXYZ, PBS, CNBC, MSN Money, Financial Planning Magazine and OnWallStreet.com.

The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Please note, changes in tax laws may occur at any time and could have a substantial impact upon each person's situation. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional. Unless certain criteria are met, Roth IRA owners must be 59½ or older and have held the IRA for five years before tax-free withdrawals are permitted. Additionally, each converted amount may be subject to its own five-year holding period. Converting a traditional IRA into a Roth IRA has tax implications. Investors should consult a tax advisor before deciding to do a conversion.

State Pension Tax Relief for All Coming Soon!

Contributed by: Kali Hassinger, CFP®, CSRIC™

In early March of 2022, Michigan’s Gov. Gretchen Whitmer signed the Lowering MI Costs plan into law. This legislative change includes an update that will phase out state tax on pensions (both public and private) and other retirement income for many Michigan residents! Like past rules, the amount that can be deducted depends on when you were born and is adjusted incrementally over the next four years. 

For those born in 1945 and before, there is no change. The maximum allowed deduction can still be claimed each year. In 2023, that amount is $56,961 for single filers and $113,822 for joint filers. This maximum deduction amount is adjusted for inflation each year.  

2023

• For those born between 1946 and 1952:  Taxpayers will choose between claiming the current exemption of $20,000 for single filers or $40,000 for joint filers, or, under the new law, can deduct up to 25% of the max 2023 deduction amount (Single Filers: $56,961 x .25 = $14,240.25; Joint Filers: $113,922 x .25 = $28,480)

• For those born between 1953 and 1958: Single filers can deduct up to 25% of the 2023 amount of $56,961 ($14,240.25), Joint Filers can deduct up to 25% of the 2023 amount of $113,922 (28,480). Under previous law, there was no deduction allowed. 

• For those born in 1959 and after:  No deduction allowed 

2024  

• For those born between 1946 and 1952:  Taxpayers will choose between claiming the current exemption of $20,000 for single filers or $40,000 for joint filers, or under the new law, Single and Joint filers can deduct up to 50% of the 2024 maximum deduction amount

• For those born between 1953 and 1962:  Can deduct up to 50% of the maximum deduction allowed in 2024

• For those born in 1963 and after: No Deduction allowed

2025

• For those born between 1946 and 1952:  Taxpayers will get to choose between claiming the current exemption of $20,000 for single filers or $40,000 for joint filers, or under the new law, Single and Joint filers can deduct up to 75% of the 2025 maximum deduction amount

• For those born between 1953 and 1966:  Can deduct up to 75% of the maximum deduction allowed in 2025

• For those born in 1967 and after: No Deduction allowed

2026 

• For all taxpayers: Full Deduction allowed

This change is estimated to reduce state tax paid by an average of $1,000 for each household affected.

Kali Hassinger, CFP®, CSRIC™ is a Financial Planning Manager and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® She has more than a decade of financial planning and insurance industry experience.

The information contained in this letter does not purport to be a complete description of the securities, markets, or developments referred to in this material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Kali Hassinger, CFP®, CSRIC™, and not necessarily those of Raymond James. Expression of opinion are as of this date and are subject to change without notice. There is no guarantee that these statement, opinions or forecasts provided herein will prove to be correct. Investing involves risk and you may incur a profit or loss regardless of strategy selected, including diversification and asset allocation. Individual investor’s results will vary. Past performance does not guarantee future results. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation.

Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services are offered through Center for Financial Planning, Inc. Center for Financial Planning, Inc. is not a registered broker/dealer and is independent of Raymond James Financial Services.

Raymond James does not provide tax advice. Please discuss these matters with the appropriate professional. This document is a summary only and not meant to represent all provisions within the Lowering MI Cost plan.

Surprise, Surprise – Oil & Global Geopolitical Showdowns

We have mentioned in past commentaries the surprise turn in US energy production over the last several years. It turns out energy markets aren’t done with surprises as a combination of pressure from Saudi Arabia to reduce oil prices, lower demand at home and abroad, and a variety of other factors has resulted in a precipitous decline in oil prices. Six months ago, crude oil traded near $100. Today (as of January 12th) oil is trading around $46 (source: Bloomberg.com).

This surprise has had a real impact on markets with both winners and losers. You can probably feel the “win” at the pump as your gas bills have likely been cut almost in half. This is a real bonus in US consumer pockets and in the past it has meant good things to our consumer-driven economy.

It may not be a surprise that oil was about to throw us a loop when you consider that commercials were starting to infiltrate CNBC and Bloomberg suggesting that you can buy your own oil well. This reminds me of direct to consumer gold infomercials a few years back. Oil-rich areas of the country and energy-specific stocks will be calculating new scenarios for the future with significant changes to their assumptions. It will take a while to muddle through the winners and losers with the new energy prices, but stock markets have been wary of the decline which has been welcomed by volatility and down days.

Other surprises have been geopolitical in nature. Ukraine-Russia conflict, terrorism in Europe, two Malaysian air tragedies, these just touch the surface of headlines that have touched our psyche and somewhat rattled markets. Studies of market returns after geopolitical events such as wars and military actions have shown that stocks as measured by the S&P can initially dip but typically recover in a short but unpredictable period of time (Sources: Talha Khan, Capital Markets Group; Mark Haefele, UBS, S&P Capital IQ).

Disciplined investors can take advantage of disruptive forces in markets. Maintaining investments and rebalancing offer opportunities to stay the course and buy low while selling high. If you’d like to discuss specific scenarios and events, please don’t hesitate to reach out to your planner or our investment team.

Melissa Joy, CFP®is Partner and Director of Investments at Center for Financial Planning, Inc. In 2013, Melissa was honored by Financial Advisor magazine in the Research All Star List for the third consecutive year. In addition to her contributions to Money Centered blogs, she writes investment updates at The Center and is regularly quoted in national media publications including The Chicago Tribune, Investment News, and Morningstar Advisor.

Financial Advisor magazine's inaugural Research All Star List is based on job function of the person evaluated, fund selections and evaluation process used, study of rejected fund examples, and evaluation of challenges faced in the job and actions taken to overcome those challenges. Evaluations are independently conducted by Financial Advisor Magazine.

Required Disclaimers: Information provided is general in nature, and is not a complete statement of all information necessary for making an investment decision, and is not a recommendation or a solicitation to buy or sell any security. Information contained in this report was received from sources believed to be reliable, but accuracy is not guaranteed. Past performance is not indicative of future results. Investing always involves risk and you may incur a profit or loss. No investment strategy can guarantee success. International investing involves additional risks such as currency fluctuations, differing financial accounting standards, and possible political and economic instability. Investments in the energy sector are not suitable for all investors. Further information regarding these investments is available from your financial advisor. Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize or sponsor any of the listed web sites or their respective sponsors. Raymond James is not responsible for the content of any web site or the collection or use of information regarding any web site's users and/or members. C15-001751

Shutdown Showdown

Americans seemed to be more interested in television’s Breaking Bad finale than Washington proceedings last weekend, but we turned the calendar to October only to welcome the first government shutdown since 1996. With negotiations tied to blockage of new insurance exchanges, it is difficult to see how Republicans and Democrats will ultimately come to agreement and open up America for business as usual.

Here are our economic and investment thoughts on the shutdown:

• Where only chaos sparks results: You have to wonder if Congress was looking for a very bad reaction to the shutdown in order to spark an incentive to start negotiating with each other. Crisis policy seems to have had the most reliable results when it comes to any semblance of political leadership in the past five years. Our leaders didn’t get such a crisis as US stock markets opened higher on the first day of shutdown (Tuesday, October 1st).
• Unpopular politics: Voter frustration can be measured in poll results which show that the health care law is unpopular but the government shutdown is even less desirable. Bloomberg reported Tuesday that 72% of American’s opposed a shutdown tied to ObamaCare in a Quinnipiac University poll.
• The hit to GDP: Growth numbers in the US have already been stymied by fiscal austerity in the form of higher taxes and less spending this year. The biggest impact to those who don’t cash a paycheck from the government or have a trip to a national park planned may be a hit to the US GDP. The 800,000 employees who were sent home represent a workforce larger than Target, Exxon Mobil, General Motors, and Google combined (Tom Keane, Bloomberg Radio, 10/2/13). We should note that the hit might have been higher in past shutdowns as US employment in government jobs has been falling. I tried to pull the exact numbers by accessing the US Census Bureau, but the site was down due to the government shutdown.
• Silver lining: All the rotten tomatoes being thrown at Congress mask the surprising statistic that the US government budget deficit has been falling rapidly in the last twelve months with an even larger decline anticipated. This does not excuse a failure of governance and does not balance the books overall, but it should be noted as we mourn the loss of decorum or certainty in the function of business in Washington DC.
• Avoid at all costs: The government shutdown seems to be a prelude to another debt ceiling standoff which many market watchers consider to be much more threatening. It seems absurd that US policymakers would manufacture a crisis rather than providing the ability to pay bills. Given the beltway dysfunction, though, never say never. We’ll keep you posted with our upcoming quarterly investment commentary.

All this bad news masks a US economy whose private sector continues to grow and a growing chorus of statistics that seem to support global recovery from recessions, especially in Europe. Our advice for investors right now is not to let the political tail wag your investment dog. Excepting short-term cash-flow needs, focusing on the long-term may benefit reward investors by using dips as buying opportunities rather than selling to duck and cover.

Melissa Joy, CFP®is Partner and Director of Investments at Center for Financial Planning, Inc. In 2011 and 2012, Melissa was honored by Financial Advisor magazine in the inaugural Research All Star List. In addition to her frequent contributions to Money Centered blogs, she writes frequent investment updates at The Center and is regularly quoted in national media publications including The Chicago Tribune, Investment News, and Morningstar Advisor.

Financial Advisor magazine's inaugural Research All Star List is based on job function of the person evaluated, fund selections and evaluation process used, study of rejected fund examples, and evaluation of challenges faced in the job and actions taken to overcome those challenges. Evaluations are independently conducted by Financial Advisor Magazine.

The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Melissa Joy and not necessarily those of Raymond James.

Sequestration Frustration

After a debt-ceiling reprieve, the US government’s next big hurdle is the March 1st Sequester. What is sequestration and how does it affect you?

During the debt ceiling showdown in the summer of 2011, a group of arbitrary across-the-board spending cuts deemed unacceptable to both Democrats and Republicans was drafted to ensure action on deficit reduction. It wasn’t a solution, it was just a way to buy time and it’s called a sequester. Through a series of compromises, the deadline for the sequester has been moved to March 1, 2013 and separated from other components of the “fiscal cliff”.

When totaled, the sequester’s automatic spending cuts reduce government spending in 2013 by $85 billion (source: JP Morgan Market Bulletin, 2/19/13). Here’s a breakdown of cuts mapped out in the legislation through 2021.

What does the sequester mean to you as a citizen and investor?

Fiscal drag.The Congressional Budget Office estimates the initial impact to GDP in 2013 of around 0.56% if the sequester lasts from March through the end of the year (source: Washington Post, “The Sequester”, 2/20/2013).  This could mean uneasy stock markets, less hiring, and more muted recovery.

Arbitrary cuts. The punitive nature of across the board cuts may have an impact for you in other ways. Those most affected probably work within the government. Some could lose their jobs and those that don’t could find themselves working in a very constricted environment. For the average citizen,  daily encounters with the government may be slowed or changed. Some examples? Fewer food safety inspections, flight back-ups due to cuts at the FAA, slower federal court systems with lighter dockets meaning delays to cases, cuts to federally-funded scientific research, defense contracts, and reduced military benefits.

Market disruption.The idea of a sequester is popular with almost no one. This could translate into less confidence in stock markets and increased volatility. In the longer term, the failure to address debt and deficit issues could have even larger implications.

We can’t predict how everything relating to a spending sequester will fall out. Markets so far this year have turned the other cheek whether from fatigue with politically-inspired deadline drama or positive reaction to other news. We’ll keep you posted as Capitol Hill sorts things out in the coming weeks and months.

Required Disclaimer: The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Any opinions are those of Melissa Joy, CFP® and not necessarily those of RJFS or Raymond James.

Barclay's, LIBOR, and What it Means for You - 3rd Quarter 2012

Just what the world needs today: another financial scandal involving banks and your money! An investigation initiated in 2007 has culminated in a nearly half billion dollar fine from Barclay’s and the possibility of an ever-expanding scandal.

The London Interbank Offered Rate (also known as LIBOR) is a common benchmark for financial instruments based upon the cost of borrowing between large banks around the world. If you read financial headlines, the last time you may have been thinking about LIBOR rate was in 2008 when the cost for borrowing between banks went through the roof. But, whether or not you’re following LIBOR, it’s not obscure. In fact, LIBOR is linked to more than $700 trillion in financial instruments around the world including adjustable mortgages, student loans, and car loans.

It turns out that Barclay’s (and quite probably other banks) were padding their own wallets leading up to the financial crisis by boosting LIBOR rates. This meant that derivatives on their books were paying off for the banks. They could also collect more on the loans they issued linked to LIBOR. It made their operations more profitable, possibly at the expense of your loan costs if you had adjustable rate loans. Another big victim may have been your local government as many municipalities have contracts tied to LIBOR.

That’s not all! Just as it helped to boost the LIBOR in 2007, it was very useful to report lower LIBOR rates amidst the global meltdown. Why? Well, lower borrowing meant you might be a stronger financial institution. This is a good thing if you’re trying to stay in business and prevent a bank run. Again, this goes back to the bank’s profitability with little regard for the victims of such a scam. And fudge those numbers they did!

How, you may ask, could they get away with this? LIBOR is managed based upon a glorified honor system. Banks are expected to look in the mirror each day and report their inter-bank borrowing costs. This self-reporting system seems to have lots of cracks, and many are saying that Barclay’s getting caught is just the tip of the iceberg.

Want to learn more? Here are some resources that further explore this unfolding topic:

• LIBOR for Mortals Marketplace Radio

• The Rotten Heart of Finance The Economist

• Infographic: The LIBOR Scandal Explained AccountingDegree.net via BusinessInsider.com 

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The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Melissa Joy, CFP® and not necessarily those of RJFS or Raymond James. Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize or sponsor any of the listed websites or their respective sponsors. Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users.