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2013: A Taxing Situation
Perplexed by changes that will be wrought by the government’s solution to the fiscal cliff? “What makes the situation more confusing,” says Jerold E. Rothkoff, “is that there were a lot of numbers tossed around in a variety of proposed tax increases, and during the presidential campaign, it was hard to keep track of who was telling the truth about what. And none of it exactly mattered because any changes had to get approved by Congress. On top of that, health care changes are going to begin in 2014. So, there’s a lot going on.”
Indeed. Rothkoff is the principal of the Rothkoff Law Group, where he specializes in elder law, asset protection, veterans benefits, estate planning, and long-term care planning and advocacy. And, as 2012-2013 president of the Life Care Planning Law Firm Association, a national organization of geriatric care and elder law attorneys, Rothkoff is right in the thick of changes that will effect millions of Americans.
While politicians speak in big, round numbers and percentages, Rothkoff says that Americans should think in micro, not macro, terms. “I encourage people to figure out what these changes mean specifically for them,” he explains. “Don’t worry about the politics or what you hear on TV. Focus on how the changes will affect four areas of your life: annual taxes; estate planning; health care coverage including Medicare and Medicaid; and long-term care planning.”
Other changes — the birth of grandchildren, death of a spouse, remarriage, retirement — are also reasons to re-evaluate your financial plans. “Some people find this overwhelming, and I understand that, but I don’t want anyone to delay their planning,” Rothkoff says. “After all, that’s kind of how Congress got into this fiscal cliff situation. You know, lots of people see the new year as a time to lose weight. I think the new year — especially this one — is a great time to worry about not just your physical health, but also your financial health.