As part of our ongoing objective to provide you with the highest-quality financial services, the Tax Center will be updated with the latest news and analysis. Check here often for updates and additional information.

Year-End Tax Planning: Be Knowlegeable and Nimble (October 2009)
The turmoil and uncertainty in the financial markets over the past two years have caused many individuals and families to reevaluate their financial plans. However, against the backdrop of likely changes in tax law, you may be perplexed as to how to plan effectively. With year-end fast approaching, our advice is to be knowledgeable and nimble.

In "Year-end Tax Planning: Be Knowledgeable and Nimble," Northern Trust Tax Strategist Grace Allison recommends that you and your advisors assess the likely income and transfer tax outcomes, identify the various alternatives and build an up-to-date wealth transfer plan. Read this paper to learn about particular strategies you may wish to consider.

Income Tax Provisions of the American Recovery and Reinvestment Act of 2009
On February 17, 2009, President Obama signed into law the $787 billion American Recovery and Reinvestment Act of 2009 (the “Act”).  Among $301 billion in tax cuts made by the Act are income tax provisions directly affecting individual taxpayers.
Highlights of the major tax law provisions directly affecting individuals are set forth in this Tax News You Can Use.

Important Message Regarding 2009 Required Minimum Distributions (RMDs)
On December 23, 2008, the Worker, Retiree and Employer Recovery Act of 2008 was signed into law. The legislation, which waives required minimum distributions for the 2009 tax year from IRAs and employer-sponsored defined contribution retirement plans, is designed to provide investors some relief given the recent market downturn.

The waiver applies to all IRA owners subject to RMD rules, plan participants and beneficiaries of deceased IRA owners. For living IRA owners, if you are age 70½ or older in 2009, your next required RMD is due by December 31, 2010. However, IRA owners who turned 70½ in 2008 must still take their 2008 RMDs by April 1, 2009, to meet 2008 tax year requirements.

We encourage you to speak with your tax advisors to determine whether you should take a distribution when one is not required.

Personal Tax Changes Buried in Housing Act. . . (August, 2008)
On July 30, 2008, President Bush signed into law the Housing and Economic Recovery Act of 2008. The Act includes a wealth of tax provisions, including benefits for multi-family low-income housing, incentives for single family housing and various reforms relating to the taxation of REITs (real estate investment trusts). It also includes a series of revenue raisers scored to offset fully the estimated $15 billion cost of those benefits, incentives and reforms.

The opinions expressed here are those of the authors and do not necessarily reflect those of the Northern Trust Corporation or its subsidiaries. The information has been obtained from sources believed to be reliable, but its accuracy and completeness are not guaranteed. Any opinions expressed herein are subject to change at any time without notice. Any person relying upon this information shall be solely responsible for the consequences of such reliance.

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