11.21.09
Posted in Uncategorized at 1:45 pm by Eric
I’ve often wondered: With seven minor children, what’s the maximum amount my family would receive from Social Security if I died? The bad news is, I don’t get any credit for children four through seven. Benefits max out at three children. The good news is, based on my Average Indexed Monthly Earnings, my family would receive $4,424 per month. This would continue for about ten years (total pay-out: over $500,000), at which point my fifth child would reach age 19 and the monthly payment would start to decrease. When my youngest child reaches age 19 (fifteen years from now), it would end.
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11.12.09
Posted in Uncategorized at 1:07 am by Eric
Answer to a question we field occasionally: An IRS tax lien is good for ten years from the date of the IRS assessment. If you signed a waiver, the lien might be good for even longer.
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11.11.09
Posted in Uncategorized at 1:51 pm by Eric
If you’re a creditor of a corporation and you’re not getting paid, don’t forget that many corporations have included a compromise provision in their articles of incorporation. The following provision has been a part of the State of Michigan pre-printed form for decades, and although it’s perfectly permissible for corporations to cross it off before filing the form, the vast majority of corporations leave it in, and therefore the provision is binding on the corporation and people dealing with the corporation:
When a compromise or arrangement or a plan of reorganization of this corporation is proposed between this corporation and its creditors or any class of them or between this corporation and its shareholders or any class of them, a court of equity jurisdiction within the state, on application of this corporation or of a creditor or shareholder thereof, or on application of a receiver appointed for the corporation, may order a meeting of the creditors or class of creditors or of the shareholders or class of shareholders to be affected by the proposed compromise or arrangement or reorganization, to be summoned in such manner as the court directs. If a majority in number representing 3/4 in value of the creditors or class of creditors, or of the shareholders or class of shareholders to be affected by the proposed compromise or arrangement or a reorganization, agree to a compromise or arrangement or a reorganization of this corporation as a consequence of the compromise or arrangement, the compromise or arrangement and the reorganization, if sanctioned by the court to which the application has been made, shall be binding on all the creditors or class of creditors, or on all the shareholders or class of shareholders, and also on this corporation.
It might offer you an avenue that’s not often considered.
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11.02.09
Posted in Uncategorized at 12:12 pm by Eric
Health Savings Accounts are neat vehicles. If you’re covered by a high-deductible health insurance plan, you can deposit money into a health savings account and receive a tax deduction for the contribution. If you later take a distribution from the HSA to reimburse or pay medical expenses (dental, optical, prescriptions, whatever), you don’t have to recognize the distribution as income. If you have family coverage, you can deposit $5,950 annually into the HSA. Because many families don’t burn through that much in medical expenses, the unused portion accumulates and earns income.
And that’s where the money-making opportunity comes in. Someone manages those funds. Places like UnitedHealth Group earn money doing it, but the previous arrangements weren’t profitable enough for them, so they took advantage of regulatory changes last January and tripled the annual fees . . . to the detriment of their customers:
UnitedHealth Group controls roughly 15% of the market for HSAs, which it offers through OptumHealth Bank, a wholly owned subsidiary. Until late last year its HSA clients had 11 mutual fund choices from Vanguard Group. Annual fees ranged from 18 cents to 35 cents per $100 invested.
By late 2008 Optum had yanked the Vanguard options for new customers. Funds on the menu now hail from firms like Munder and Thornburg; fees range from 76 cents to $1.37 per $100.
Why the switch? No coincidence, perhaps, that regulatory changes this January enabled entities like OptumHealth and their consultants to start pocketing a cut of fund management fees. Nor, perhaps, is it purely random that many fund firms popping up in HSAs these days kick back fees to plan managers. Vanguard does not pay kickbacks.
Link.
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