Mountain Views News, Combined Edition Saturday, January 18, 2020

MVNews this week:  Page 7


Mountain Views-News Saturday, January 18, 2020 


Washington, D.C. — Today, Rep. Adam Schiff (D-CA), the Chairman of the 
House Permanent Select Committee on Intelligence, released the following 
statement after Speaker Nancy Pelosi announced the House Managers for the 
Senate impeachment trial of President Donald J. Trump:


“I am humbled by the responsibility of serving as the lead House Manager in 
the Senate impeachment trial of President Donald J. Trump, and thank Speaker 
Pelosi for the trust she has place in me and our team. It is a solemn responsibility 
and one that I will undertake with the seriousness that the task requires.


“The House of Representatives was compelled by our duty to Constitution 
and country to hold President Trump accountable for his wrongdoing. President 
Trump abused the power of his office by pressing a foreign government 
to interfere in our elections, while withholding a highly sought-after White 
House meeting and vital military aid to an ally at war with Russia. When he 
was caught, President Trump obstructed – in an unprecedented and sweeping 
fashion – the House impeachment inquiry.


“The overwhelming evidence and testimony presented against the President 
led to his impeachment last month, and since that time, more documents have 
come to light, and witnesses have come forward willing to testify.


“Americans overwhelmingly want a fair trial in the Senate, fair to the President 
and fair to the people. Senators must demand to see and hear the full evidence, 
including the documents and witnesses the President has blocked. Only then 
can they faithfully discharge their own Constitutional duties to be fair and impartial jurors.


“Trump’s abuse of power is a clear and present danger to our democracy and national security interests. The House upheld our 
Constitutional duty. Now it’s up to the Senate to do the same.


“In this next phase, I look forward to working closely with my fellow Managers on behalf of the American people and in defense 
of our Constitution.”



On January 1, 2020, the Setting Every Community Up for Retirement Enhancement 
Act (SECURE Act) went into effect, and it could have big implications for both 
your retirement and estate planning strategies—and not all of them are positive. 
Last week, I gave you a general overview of the SECURE Act’s most impactful provisions. Under 
the new law, your heirs could end up paying far more in income taxes than necessary when they 
inherit the assets in your retirement account. Moreover, the assets your heirs inherit could also 
end up at risk from creditors, lawsuits, or divorce. And this is true even for retirement assets held in certain protective trusts designed 
to shield those assets from such threats and maximize tax savings. 

Here, we’ll cover the SECURE Act’s impact on your financial planning for retirement, offering strategies for maximizing your 
retirement account’s potential for growth, while minimizing tax liabilities and other risks that could arise in light of the legislation’s 
legal changes.
Tax-advantaged retirement planning

If your retirement account assets are held in a traditional IRA, you received a tax deduction when you put funds into that account, 
and now the investments in that account grow tax free as long as they remain in the account. When you eventually withdraw funds 
from the account, you’ll pay income taxes on that money based on your tax rate at the time.

If you withdraw those funds during retirement, your tax rate will likely (but not always) be lower than it is now. The combination 
of the upfront tax deduction on your initial investment with the likely lower tax rate on your withdrawal is what makes traditional 
IRAs such an attractive option for retirement planning. 
Thanks to the SECURE Act, these retirement vehicles now come with even more benefits. Previously, you were required to start 
taking distributions from retirement accounts at age 70 .. But under the SECURE Act, you are not required to start taking 
distributions until you reach 72, giving you an additional year-and-a-half to grow your retirement savings tax free. 

The SECURE Act also eliminated the age restriction on contributions to traditional IRAs. Under prior law, those who continued 
working could not contribute to a traditional IRA once they reached 70 .. Now you can continue making contributions to your 
IRA for as long as you and/or your spouse are still working. 

From a financial-planning perspective, you’ll want to consider the effect these new rules could have on the goal for your retirement 
account assets. For example, will you need the assets you’ve been accumulating in your retirement account for your own use during 
retirement, or do you plan to pass those assets to your heirs? From there, you’ll want to consider the potential income-tax consequences of each scenario. 
Your retirement account assets are extremely valuable, and you’ll want to ensure those assets are well managed both for yourself and future generations, so you should discuss these issues with your 
financial advisor as soon as possible. If you don’t already have a financial advisor, we’ll be happy to recommend a few we trust most. 
And if you meet with us for a Family Estate Planning Session (or for a review of your existing plan) to discuss your options from a legal perspective, we can integrate your financial advisor into our 
meeting. Together, we can look at the specific goals you’re trying to achieve and determine the best ways to use your retirement-account assets to benefit yourself and your heirs. 

Here are some things we would consider with you and your financial advisor:

Converting to a ROTH IRA

In light of the SECURE Act’s changes, you may want to consider converting your traditional IRA to a ROTH IRA. ROTH IRAs come with a potentially large tax bill up front, when you initially transition 
the account, but all earnings and future distributions from the account are tax free. 
Life insurance trust options

Given the new distribution requirements for inherited IRAs, we can also look at whether it makes sense to withdraw the funds from your retirement account now, pay the resulting tax, and invest the 
remainder in life insurance. From there, you can set up a life insurance trust to hold the policy’s balance for your heirs.
By directing the death benefits of that insurance into a trust, you can avoid burdening your beneficiaries with the SECURE Act’s new tax requirements for withdrawals of inherited retirement assets as 
well as provide extended asset protection for the funds held in trust.

Charitable trust options

If you have charitable inclinations, we can consider using a charitable remainder trust (CRT). By naming the CRT as the beneficiary of your retirement account, when you pass away, the CRT would make 
monthly, quarterly, semi-annual, or annual distributions to your beneficiaries over their lifetime. Then, when the beneficiaries pass away, the remaining assets would be distributed to a charity of your 

The decision of whether to transition your traditional IRA into a ROTH IRA now, or cash out and buy insurance, or use a CRT to provide for your beneficiaries is a solvable “math problem.” Using the 
specific facts of your life goals as the elements that go into solving the problem, we can team up with your financial advisor to help you do the math and solve the equation.

Adjusting your plan
While the SECURE Act has significantly altered the tax implications for retirement planning and estate planning, as you can see, there are still plenty of tax-saving options available for managing your 
retirement account assets. But these options are only available if you plan for them. 
If you don’t revise your plan to accommodate the SECURE Act’s new requirements, your family will pay the maximum amount of income taxes and lose valuable opportunities for asset-protection and 
wealth-creation as well. You’ve worked too hard for these assets to see them lost, squandered, or not pass to your heirs in the way you choose, so put this planning at the top of your new year’s resolution 

Dedicated to empowering your family, building your wealth and defining your legacy, A local attorney and father, Marc Garlett is on a mission to help parents protect what they love most. His office 
is located at 55 Auburn Avenue, Sierra Madre, CA 91024. Schedule an appointment to sit down and talk about ensuring a legacy of love and financial security for your family by calling 626.355.4000 
or visit for more information.

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