|
President's Message
|
Dear association members,
2010 is here! I cannot speak for all of you, but I am sure glad that 2009 is finally in the past. The last
year and a half has been interesting. We all were affected by the industry changes in one way or another. Some
have lost their jobs, while others had to take on extra responsibilities with no additional resources.
François de la Rochefoucauld’s famous quote “The only thing constant in life is change” is still true to this
day. I am a firm believer that change is for the best. We just have to find a way to see our next adventure in
life. The past 18 months have been called everything from “crisis” to “next depression.” I just call this time
challenging.
It is during this challenging time that a true nature in each of us prevails. I call upon all of you to challenge
yourselves to make a difference in 2010: whether by mentoring others, volunteering, involving others in
your charity work, or simply having an open mind to new ideas.
I look forward to seeing all of you during monthly lunch meetings and at the LA Expo 2010! Let’s make it a great
year!
Zoya Lieberman, CTP, MBA
|
|
SCAFP Updates
|
SCAFP Website – We have made some changes to our website. A Calendar of events has been added with links to
upcoming meetings and other educational opportunities.
We have also added a Member Directory with secure login access for members only. In this section you can view a
member roster, view your profile, change your password and renew your membership.
To login to the website press the 'login' link in the Members' Only box at the top of the page. At the login page
type in the email address you gave SCAFP and your password. If you do not know your password click on the 'Forgot
your password' link, and it will be immediately emailed to you. You might have to check your junk mail or spam
folder.
SCAFP also has a Group Profile on LinkedIn. To register please request to be added as a member under SCAFP -
Southern California Association For Financial Professionals. On our LinkedIn profile you can create a discussion,
post job opportunities and network with colleagues.
Save The Date. The 29th Annual Expo LA 2010 will be held in Long Beach again this year. The two day event will be
held May 6,7 2010. You can register at www.scafp.net For Speaker Opportunities
please contact Celeste Caulfield, CTP, KB Home, 310-893-7437
ccaufield@kbhome.com For Sponsorship Opportunities please contact Randy
Gehres, CTP, Travelex Global Business Payments, 310-277-7800 randy.gehres@travelex.com
|
|
Toys for Tots
|
The USC NROTC individuals attended our 2009 holiday lunch and received several toys from SCAFP members.
 The goal of the USC NROTC program is to train and develop midshipmen in order to become officers in the Navy and
Marine Corps. We attend classes like regular students but also have numerous activities, classes, and training
sessions throughout the year and during the summer to develop technical and leadership skills. Upon graduation
we have an obligation to serve 4 years active duty and 4 years reserve duty.
The mission of the U. S. Marine Corps Reserve Toys for Tots Program is to collect new, unwrapped toys during
October, November and December each year, and distribute those toys as Christmas gifts to needy children in the
community in which the campaign is conducted. The program is conducted all over the country and is responsible
for the collection and distribution of thousands of toys to those in need.
|
|
Hello, World: ACH Goes Global
|
In September 2009, all financial institutions complied with the National Automated Clearinghouse Association’s
(NACHA) ruling that distinguishes between transactions received from outside the United States and international
transactions.
Source: www.skymarx.com
All international payments made via the ACH Network will be identified as International ACH transactions using
a new Standard Entry Class (SEC) Code – IAT. This rule also requires that IAT payments include specific data
elements defined by the Bank Secrecy Act’s (BSA) Travel Rule.
According to NACHA, there are international ACH payments that receiving depository financial institutions cannot
identify. Many payments initiated internationally enter the U.S. ACH Network through correspondent banking
relationships. As a result, a number of international payments are formatted as domestic transactions, making it
difficult for depository institutions to identify these transactions to comply with U.S. law.
It is worth noting that the International Payment Format (IPF) affects only the Euro and Dollar, with other
currencies to follow. Another area that won’t be affected by the IPF is foreign exchange, as this subset of
global commerce consists of bilateral agreements between parties.
NACHA says that this rule will help banks comply with BSA regulations since the new ACH standard requires more
specific documentation to accompany each payment, per the BSA Travel Rule. As a result, depository institutions
should find it easier to comply with OFAC guidance.
As a side benefit, banks will be able to distinguish between consumer and business ACH transactions. Effective
September 18, 2009, U.S. ACH Network formats will become more consistent with other network formats, such as
wire transfer formats, that currently carry the Travel Rule information to comply with BSA. The change is also
consistent with the field lengths in SWIFT formats to ensure efficient mapping of data.
Currently, some of the international ACH entries within the ACH network look like domestic entries and are
identified with the existing Standard Entry Class (SEC) codes such as PPD, CCD, or CTX. However, in the future
it may be appropriate to identify the entries with the IAT code based on the international ACH definition.
NACHA has developed several representative scenarios to represent an assessment of situations that which might
give rise to a determination of an IAT versus a domestic ACH transaction.
Penalties for non-compliance with OFAC’s regulations can be severe. While financial institutions can contract
with other parties for ACH processing services, these institutions cannot contract away their liabilities
related to OFAC compliance.
OFAC penalties for non-compliance can be both criminal and civil. Penalties can vary from fines per count
(corporate and individuals), ranging from $10,000 to $100,000 per count, to imprisonment, with sentences ranging
from 10 to 30 years. Forfeiture of property is another possible OFAC penalty.
|
|
Tax Planning for 2010
|
This article is contributed by David A. Paddock, CPA
Now that 2009 year-end tax planning is behind us, it is time to start thinking about tax planning for 2010. This
article highlights some of the tax law provisions for the New Year.
Alternative minimum tax (AMT) will hit many more taxpayers. The AMT exemption amount for 2010 is $33,750 ($45,000
if married filing jointly or a qualifying widow(er); $22,500 if married filing separately). The AMT exemption
amount for 2009 was $46,700 ($70,950 if married filing jointly or a qualifying widow(er), $35,475 if married
filing separately).
Additionally, many personal nonrefundable credits are allowed only to the extent that their aggregate amount does
not exceed the excess of: (a) the taxpayer's regular tax liability, over (b) the tentative minimum tax, determined
without regard to the AMT tax foreign tax credit. In other words, for 2010, many personal tax credits cannot offset
the AMT. For 2009, personal nonrefundable credits could offset the alternative minimum tax. Congress will deal with
the AMT problem either through another one-year patch, as it has several times before, or by revising the AMT in
the context of an overall tax reform bill.
Required minimum distributions (RMDs) return. RMDs must be made for calendar year 2010 from IRAs and
employer-provided qualified retirement plans that are defined contribution plans. RMDs for calendar year 2009 were
waived.
For 2010 and thereafter, the rule that barred taxpayers with more than $100,000 of modified AGI from converting
traditional IRAs to Roth IRAs is eliminated. Additionally, married taxpayers filing a separate return may convert
amounts in a traditional IRA into a Roth IRA (before 2010 they were barred from doing so). Additionally, for such
conversions made in 2010, any amounts that would be included as income as a result of the conversion will be
included in income in equal amounts in 2011 and 2012, unless the taxpayer elects to include the entire amount in
income in 2010.
For 2010, taxpayers with higher levels of AGI will no longer face a phase-out of their deduction for personal
exemptions or a reduction in their itemized deductions. For 2009, the personal exemption phase-out began when AGI
exceeded these threshold amounts: $250,200 (joint return or surviving spouse), $208,500 (head of household),
$166,800 (single) and $125,100 (married filing separately). And the itemized deduction reduction began when AGI
exceeded $166,800 ($83,400 for married filing separately).
Recapture of first-time homebuyer credit. Taxpayers who claimed a first-time homebuyer credit (FTHTC) for homes
bought after Apr. 8, 2008 and before Jan. 1, 2009, must begin repaying the credit in 2010. The FTHTC must
generally be recaptured (i.e., repaid) in equal installments over a 15-year period. Recapture is accelerated if a
taxpayer disposes of his residence or it ceases to be his and his spouse's principal residence before the end of
the 15-year recapture period. The homes purchased after December 31, 2008 and before May 1, 2010, taxpayers are
not required to repay the credit. Also, a $6,500 credit is allowed for long-term residents.
As part of the estate tax repeal that applies for individuals dying in 2010, the income tax basis rules for
property acquired from a decedent in 2010 are similar to the gift tax carryover basis rules but with many
opportunities for heirs to get increases in basis. For example, it is possible to increase the basis of assets
received from an individual dying in 2010 by $1.3 million and by an additional $3 million for assets going to a
spouse. The step-up in basis rules return for 2011.
In general, personal casualty or theft losses for the tax year generally are allowable only if they exceed a
dollar limitation per casualty or theft. In addition, aggregate net casualty and theft losses generally may be
claimed as an itemized deduction only to the extent they exceed 10% of an individual's adjusted gross income (AGI).
For 2010, the dollar limitation per casualty or theft is $100; it had been $500 for 2009.
Unless Congress acts to retroactively revive them, all of the following tax breaks for individuals won't be
available this year because they expired at the end of 2009.
- The ability to exclude part of unemployment compensation benefits. For 2009, up to $2,400 of unemployment
compensation benefits received in 2009 was excluded from gross income.
- The election to take an itemized deduction for State and local general sales taxes instead of the itemized
deduction permitted for State and local income taxes.
- The additional standard deduction for State and local real property taxes, limited to the lesser of the amount
allowable as an itemized deduction for real property taxes or $500 ($1,000 on a joint return).
- The additional standard deduction for disaster losses. Also, taxpayers who have suffered losses as a result
of a federally declared disaster may no longer calculate their casualty loss deduction without regard to the usual
10%-of-AGI limit.
- The ability to claim either an itemized deduction or an increased standard deduction under for state or local
sales or excise taxes on the purchase of a new motor vehicle.
- The ability to claim additional personal exemptions for housing for Midwestern disaster area displaced persons.
- The above-the-line tax deduction for qualified tuition and related expenses.
- The $250 above-the-line tax deduction for teachers and other school professionals for expenses paid or incurred
for books, certain supplies, computer equipment, other equipment, and supplementary materials used by the educator
in the classroom.
- The rule allowing taxpayers who are age 70 1/2 or older to make tax-free distributions to charity from an
Individual Retirement Account (IRA) of up to $100,000 per taxpayer, per tax year.
Over the last several years, tax laws have been changing frequently. The New Year will prove to be another year of
many law changes. It is possible that some of the rules mentioned above will change by the end of 2010. The biggest
change will come from new health care legislation, if passed by Congress, and a change to the estate tax regime.
Please contact me if would like to discuss tax and financial planning opportunities for the New Year.
David A. Paddock, MT, CPA
Income Tax Adviser and Financial Planner
www.paddockcpa.com
david@paddockcpa.com
310-622-7090
|
|
Officers and Directors
|
President - Zoya Lieberman, CTP, Informa Research Services
Tel: (818) 961-8627; zlieberman@informars.com
Secretary/Treasurer - Susan Farbenbloom
susan.farbenbloom@sbcglobal.net
Immediate Past President - Shannon Wexler, Bank of America
Tel: (213) 621-4939; shannon.wexler@baml.com
Director at Large - Dick Ercole
Tel: (714) 330-8834; Richard.ercole@k-fish.net
Director at Large - Lynne Shulim, CTP
Tel: (310) 344-1951; lshulim@aol.com
Meeting Programs Chair - Celeste Caulfield, CTP, KB Home
Tel: (310) 893-7437; ccaulfield@kbhome.com
Communications Chair - Randy Gehres, CTP, Travelex Global Business Payments
Tel: (310) 277-7800; Randy.Gehres@Travelex.com
Education Chair - Morgyn Taylor, CTP
morgynt@hotmail.com
Major Events Chair - Susan Quan Mah, Univ. of Southern California
Tel: (213) 740-5417; mah@usc.edu
Membership Chair - Sharon Miller Hull, CCM, First Bank & Trust
Tel: (626) 299-7643; sharon.hull@fbol.com
External Relations Chair - Michael Hards, CTP, Bank of America
Tel: (714) 327-4521; michael.r.hards@baml.com
|
|
|
