Karl Frank, Certified Financial Planner ®, MSF, MBA, MA, is the President of A&I Financial Services LLC, a local business that specializes in wealth management, insurance planning, and retirement planning. Karl cares for business owners and the businesses that care for them. Learn More about Karl.

Tax Benefits of Aging

The IRS offers some creative ways to give birthday presents to our aging population. Here are three of them: 1) larger medical expense deductions, 2) larger standard deductions and 3) a larger tax credit for the elderly who are permanently and totally disabled.*

Medical Expense Deductions

Here's a great benefit, if you're over 65 years of age. You get to deduct all your medical expenses in excess of 7.5% of your adjusted gross income, while the rest of us only get to deduct expenses over 10% of our AGI. This includes an annual physical exam, a full-body electronic scan and a pregnancy test. I'm not sure how many 65 year olds require pregnancy tests!

Standard Deductions Over Age 65

Meanwhile, back on the real-world side of the IRS, the standard deduction for folks age 65 and older is $1,500 greater than it is for the rest of us. That is a benefit that may be more useful and widespread.
You either itemize or take the standard deduction, but not both.

Disability Benefits Over Age 65

We may be living longer, but not necessarily living longer in great health. If a person is permanently and totally disabled, up to 15% of the disability income could be a tax credit (as long as it's not greater than the tax burden). If you know of a person in this situation, perhaps a friend or relative, ask them to talk to their tax preparer about the credit for the elderly and permanently disabled.

*These ideas are examples and do not constitute tax advice. Consult a qualified tax professional to obtain tax advice based on your specific situation.

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Guest Blogger: US News and World Report - Pay Less in Taxes

Recently, Kimberly Palmer from US News & World Report interviewed Karl and wrote a feature story on how to pay less in taxes.* Here are the first few paragraphs. For the complete story, visit their website by clicking here or on the link below.

Karl Frank's new book, "Go Tax Free," might be a hyperbole, but he says almost all taxpayers can take steps to significantly reduce the amount of money they hand over to Uncle Sam every year. "Most people pay more than we have to, and that's a shame. It doesn't take a whole lot of planning and foresight to reduce your tax burden, but you have to do the work," says Frank, a certified financial planner and president of A&I Financial Services LLC in Englewood, Colo.

Now, with plenty of time before the end of the year, is the time to figure out how. Frank says the group that's most primed to cut their taxes are professionals, which he describes as "folks who are already spending below their means and who don't need budgeting help, but who aren't so wealthy that they can hire a team of advisers."

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Go Tax Free

A&I Financial Services - Karl Frank Book - Go Tax Free






An assortment of tools and strategies that give readers of all backgrounds a clear, specific action plan for obtaining the maximum allowable control over when and how they pay taxes.
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