Comprehensive Planning. Lifelong Solutions.

Filing Status for Years After Spouse’s Death

By Amanda L. Richter, CPA

Taxpayers must use one of five filing statuses when filing their individual tax return. Your filing status determines your income tax rate and the amount of your standard deduction. When selecting a filing status, you may qualify for more than one status. You will want to select the filing status that results in the lowest tax.

In the year of your spouse’s death, you can still file a joint tax return. It is your responsibility to file a final return for your deceased spouse. While you can’t file a joint return for a tax year after the year in which your spouse died, you can continue to use the joint return rates for two more years if you qualify as a “surviving spouse.” The joint return rates are more favorable than the single rates or the head-of-household rates. A surviving spouse also receives a larger standard deduction than a single taxpayer or head of household.

To qualify as a “surviving spouse,” you must meet all of these requirements:

  • You have a child who qualifies as your “dependent” for the tax year.
  • Your spouse died during one of the two years immediately preceding the tax year for which the return is being filed.
  • The child lived with you for the entire year, except for temporary absences.
  • You paid over half the cost of maintaining your home.
  • You were eligible to file a joint return with your deceased spouse for the tax year of the death (even if you didn’t actually file jointly).
  • You have not remarried before the end of the tax year for which the return is being filed.

If you do not meet the requirements for surviving spouse status and you do not have a qualifying dependent, than you will file as Single for the tax years after your spouse’s death.

Adjusting income tax withholding. As a result of your spouse’s death, you may be have to adjust the amount of income tax you have withheld or make quarterly estimated tax payments. To ensure that the correct amount of tax is withheld, you should check your withholding and, if necessary, submit a new Form W-4 with the revised information.

Remarriage. If you remarry, you won’t be able to file as a surviving spouse, but you’ll be able to file a joint return with your new spouse.

Ask Kit Kat: USDA and Cat Experiments

Hook Law Center: Kit Kat, what can you tell us about the USDA and their decision to end experiments using cats?

Kit Kat: Well, in my opinion, this decision was long overdue. The announcement was made on April 3, 2019. “The agency said cats will no longer be used as ‘part of any research protocol in any ARS (Agricultural Research Service) laboratory’ and the remaining cats in its labs are in the process of being adopted by USDA employees.” This is a huge victory for cats! As the White Coat Waste Project, an animal advocacy group, has revealed, cats used in research by the USDA were in some cases injected with parasites to learn of ways to control certain diseases like toxoplasmosis in both felines and humans. Afterwards, they were put to death once the research had been completed.  Though the goal was laudable, the means were not.

There were 14 cats remaining at USDA-ARS labs which had not been infected with parasites, and these will be adopted. It took advocacy by several animal rights organizations as well as by the US Congress to accomplish this result. It’s great to see advocacy that results in permanent change. The saying “You can make a difference,” is certainly true. (Hilary Hanson, “USDA Ends Deadly Cat Experiments, Plans to Adopt Out Remaining Cats,” The Huffington Post, April 2, 2019)

Posted on Tuesday, April 16th, 2019. Filed under Senior Law News.

Why Informed Decision-Making for Retirement Income Is So Important

By Jennifer Rossettini, CFP®

For those of us still in our working years, there are two things we are good at from a financial planning perspective: earning income and saving some of that income.  What we are not so good at as we head into our retirement years is figuring out how to turn all of that hard work and savings into an income stream that will help us live comfortably in our retirement years.  While we are working, we have a couple of things going for us. We are contributing to Social Security. Some of us (and our employers) are saving to an employer retirement plan. And some of us are saving over and above our employer retirement plans into personal savings and investments. Where many of us miss the boat is coming up with a plan to turn all that we had going for us during our working years into a secure retirement income.

Granted, there are many variables to contend with as we enter retirement. Where are we going to live? How long are we going to live? What is happening with the stock market? How high is inflation going to be? When should I begin taking Social Security? How on earth are we going to pay for health care? Fortunately, a secure retirement doesn’t necessarily require a crystal ball.  What most of us need is a financial plan that not only incorporates our income needs, contingent expenses, and legacy goals, but also addresses things like longevity, inflation, long-term care, and market risk. Being in a position to make informed decisions can improve your income dramatically. For example, just choosing the right Social Security claiming strategy can increase your retirement income by 9%.[1]  Social Security benefits can be claimed between the ages of 62 and 70, with credits provided for those who wait. Nearly one-half of Americans claim Social Security benefits at age 62, presumably because they haven’t been counseled otherwise. With the right advice and the ability to make an informed decision on when to take Social Security, you can maximize the benefits that you will receive over your lifetime.

Similarly, planning for a tax-efficient withdrawal of your assets can increase your income by an additional 3.2%. Instead of keeping the same asset allocation for both tax-deferred and taxable accounts, and withdrawing proportionately from each account during retirement, a better approach may be to spend down taxable accounts first and let the tax-deferred assets continue to grow.  Finally, instead of relying on the “4% rule” by taking 4% of your portfolio at retirement and increasing that amount by inflation in the following years, consider going through an annual process of determining the maximum withdrawal rate based on your asset allocation, time horizon and a desired probability of success. This “dynamic withdrawal strategy” could increase your retirement income by an additional 10%.

In summary, there are many important decisions to be made at retirement to turn savings into income that will last. A good financial advisor and/or financial plan will help you make informed decisions that will increase your income and improve your odds of financial success.


[1] https://www.forbes.com/sites/wadepfau/2016/05/05/the-value-of-sound-financial-decisions-from-alpha-to-gamma/#6aeaf2f655df

Ask Kit Kat: Baby Panda On the Way?

Hook Law Center: Kit Kat, what can you tell us about a baby panda watch at the National Zoo in Washington, D.C.?

Kit Kat: Well, we’ll keep your fingers crossed. Mei Xiang, a female panda at the National Zoo, was artificially inseminated on March 30, 2019. However, the zoo won’t know if the procedure was a success for 3-6 months. The zoo didn’t want to leave things to chance, because the window of fertility for a female panda is only 24-72 hours each year. Also, Mei Xiang is 21, and nearing the end of her reproductive life, perhaps. Zookeepers had been watching her hormone levels since about mid-March, because she had begun acting like she was ready to breed. She was restless, vocalizing more than normal, playing with water, and marking her scent around her pen—all typical for a female panda that was ready to mate. A male panda named Tian Tian, had also noticed. The two share a “howdy window,” which enables them to socialize, but still maintain their separate areas. He was very attentive, and didn’t want to lose sight of her. However, Mei Xiang didn’t respond to his advances in the way the zookeepers had hoped. Therefore, they took the matter into their own hands. They used his sperm, and they artificially inseminated her.

Now the wait begins. The zoo staff will periodically do ultrasounds, but that in itself is a  difficult feat on a panda. The fetus tends to be small and will only weigh about a pound at birth. Also, Mei Xiang has had false pregnancies in which she acts like she’s pregnant (nesting, eating less), but she really isn’t. In 3-6 months, they’ll know for sure. Mei Xiang has given birth at the zoo, but only 3 have survived—Tai Shan, Bao Bao, and Bei Bei. Tai Shan and Bao Bao are 14 and 6, respectively, and they have been returned to China under the terms of a placement agreement. China requires that most pandas leased to the United States be returned to China at the age of 4. Giant pandas are considered “vulnerable” by the International Union for Conservation of Nature. Worldwide, there are only 500 in captivity and about 1,800 in the wild.

So let’s hope for the best, and that Mei Xiang gets one last chance to be a mother! We’ll all enjoy it, too! (Dana Hedgpeth, “Baby panda watch hits National Zoo,” appeared in The Virginian-Pilot from The Washington Post, March 31, 2019, p. 7)

Posted on Monday, April 8th, 2019. Filed under Senior Law News.

Due Process Rights in Guardianship Proceedings

By Shannon Laymon-Pecoraro, Esq.

The 14th Amendment of the Constitution of the United States of America provides the right to due process attaches to anyone who is threatened with loss of liberty or property. In guardianship proceedings, an individual that is found to be incapacitated may lose all of his rights and property. The respondent in a guardianship may lose such things as his right to vote, the ability determine where he will live, and be denied access to his property. The loss of such rights is a deprivation of liberty and property for which a court is required to ensure due process protections are afforded.

Pursuant to Virginia Code § 64.2-2003, a guardian ad litem, a licensed attorney who has been vested with a number of statutory responsibilities and duties, must be appointed by a court in every guardianship matter. The guardian ad litem represents only the “interests” of the Respondent, and not the Respondent himself. In essence, the guardian ad litem serves as the eyes and ears of the court by investigating the case and making a recommendation. Such recommendation may, however, wholly ignore the respondent’s wishes, thus depriving the respondent of the due-process protections afforded to him. As a result, the respondent has a right to choose independent counsel to serve as an advocate during the course of the guardianship proceeding.

Additionally, Virginia Code § 64.2-2007 expressly provides a respondent with the right to request a jury trial and the ability to, “compel the attendance of witnesses, present evidence on his own behalf, and confront and cross-examine witnesses.” The right to a jury is often viewed as to application of the citizens’ perspective to the law. This right, combined with the other rights afforded to a litigant, help ensure that a respondent is afforded the right to defend against an accusation of incapacity and that there is a fair process.

Ask Kit Kat: Lucky Calf

Hook Law Center: Kit Kat, what can you tell us about a young calf that got loose in New York City?

Kit Kat: Well, this is the craziest story! Did you know that New York City has approximately 80 slaughterhouses? Neither did I, until I read an article in The New York Times about it. So, on March 19, 2019, one little, darling male calf managed to escape from the conveyance which brought him, and he was trotting along the Major Deegan Expressway near Yankee Stadium in the Bronx. He had a tag in his ear, and clearly looked bound for a slaughterhouse. The NYC police sought assistance, and they had the calf tranquilized. He was then transported to an Animal Care Centers facility in Harlem. Animal Care Centers are a nonprofit which provides animal control services across the city. Someone with a sense of humor dubbed the little calf, which was under a year old, Major Deegan, after the expressway where he had been found.

Major Deegan is not the first animal to have escaped the fate of being sent to a slaughterhouse. Already this year, Katy Hansen of the Police Department says, a lamb and two goats have appeared on city streets. In the case of one of the goats, someone had taken it to a slaughterhouse as a way to get rid of the animal. Fortunately for the goat, it was rejected, and the person who brought it there, apparently just let it fend for itself.  In all of 2018, there were only three goats, seven pigs, and one sheep taken into custody after being found wandering aimlessly, so Ms. Hansen is not sure why there is a sudden spike in farm animals being abandoned.

Major Deegan, like the goat and lamb that had been recently found, were then sent to Skyland Sanctuary in Wantage, NJ, where they could have a more natural setting. The other goat was sent to the Farm Sanctuary in Watkins Glen, NY. These creatures sure got lucky! (Liam Stack,  “Slaughter-Bound Calf Escapes on Expressway, Earning New Name and a Life of Leisure,” The New York Times, March 19, 2019)

Posted on Monday, April 1st, 2019. Filed under Senior Law News.
Like us on Facebook
Planning Guides

Sign up for our email newsletter and get access to our free planning reports.

SUBSCRIBE NOW

Ask Kit Kat: Pet advice and wisdom as Kit Kat sees it.

ASK ME