When to take Social Security

When should you take social security? You are eligible when you reach age 62. If you take benefits then, your benefit will be 75% of what you would get at age 66 the full retirement age for the baby boomer generation. However if you wait until age 70 to collect your social security benefit you will get 132% of your benefit at age 66. The benefit increases 8% for each year from age 66 up until age 70 when the increase in benefit ceases. If you are in good health and you don't need social security to make ends meet, then wait and get more for the rest of your life. Cash flow is king in retirement and social security can be a cornerstone of your strategy. Social security will be there for the boomer generation but maybe not in the same form for our children.

Tax Extenders for 2017

The following expiring provisions were extended for 2017 per a law passed this month:

1. The above the line deduction for qualified tuition and related expenses of $4,000 for joint filers with adjusted gross income up to $160,000 was extended.
2. The discharge of qualified principal residence debt was excluded from taxable income.
3. The deduction for mortgage insurance premiums was extended.
4. The $500 lifetime credit for qualified energy efficient improvements to a taxpayer's principal residence came back again.

Meals and Entertainment Expenses Accounting for 2018

If you have a business I suggest that you set up the following accounts:

Meals Expense: To record all client meals and employee business meals including travel meals. These expenses are 50% tax deductible.

Entertainment Expenses: Any cost of client entertaining other than meals. These expenses are not tax deductible anymore.

Employee Relations: To record all costs of company parties or employee meetings where all are included. Costs are 100% tax deductible.

Grocery Expenses: To record costs for coffee, soft drinks, and snacks for employees. These are 100% tax deductible.

Meals and Entertainment Expenses for 2018

The new tax act eliminates any deductions for business client entertainment such as event tickets, golf games, tickets to charity events, football games, etc. However social and recreational activities for the benefit of all employees like holiday parties and summer picnics are still 100% deductible. Business meals for all employees should fit in the 100% deductible category under the social and recreational activities for the benefit of all employees. Travel business meals for employees are 50% deductible as before. The deductiblility of client business meals is uncertain. If such meals are considered entertainment, then they are not deductible. In the absence of further guidance from the IRS or court decisions, I believe they are still 50% deductible.