Unsolicited requests from friends or family and other red flags
Answer: Your friend just handed you a massive red flag. Please heed this warning that they may not be trustworthy.
Generally speaking, people shouldn't be asking for bequests for themselves. That's especially true when the request is unsolicited — in other words, if you didn't open the door by requesting what they might want from your estate.
Someone who feels comfortable enough to ask for a handout after your death may have no compunction about helping themselves to your money while you're still alive. Financial elder abuse is a huge problem, and the perpetrators are often people the victim knows such as friends, family and caregivers.
Please tell your daughter about this request, and consider going together to an estate planning attorney. The attorney can make sure your estate plan is in order and discuss ways you can protect yourself from schemers and fraudsters.
Dear Liz: My wife and I have health insurance through the Affordable Care Act exchange. With the enhanced tax credit ending this year, our insurance bill could go up from $500 a month to about $2,000 a month. Are there any good options or plans you can recommend? Would filing taxes separately help if my wife's income made her eligible for MediCal?
Answer: ACA premiums for next year have not been set, although the cost of coverage is expected to rise sharply after Congress ended enhanced premium tax credits that made coverage more affordable. The Peterson Center on Healthcare and KFF estimate that out-of-pocket premium payments will increase about 75% on average next year because of this change. In addition, insurers are asking for premium increases to cover rising healthcare costs and tariffs may further add to the cost of drugs, medical equipment and supplies.
Shop carefully during open enrollment, and consider a plan with a higher deductible to help control costs. You also could talk to a tax pro about ways to reduce your income in 2026, if it will help you qualify for a premium subsidy.
Just filing your taxes differently won't get your wife qualified for MediCal, which is California's Medicaid health insurance program for low-income people. MediCal looks at household income when determining eligibility. Actually being separated might work, but discuss this option with an attorney and a tax pro since it will have many legal and tax implications.
Dear Liz: Hello. I'd like to use my IRA for charitable donations when I'm required to make minimum distributions. The problem I've encountered is that I want to use a debit card for donations. I prefer to donate to small art organizations, which are set up for online donations and definitely not paper checks. I found one brokerage that offers an IRA with a debit card but when I spoke with them, they said it can't be used for charitable donations. I'm at a loss. Do you know of any way to make charitable donations from my IRA with a debit card? It's 2025! Surely someone has figured this out.
Answer: You've missed a key component of how this particular tax break works.
Qualified charitable contributions allow people 70½ and older to donate money from their IRAs directly to charity, without the money being taxed. The donations can count toward the required minimum distributions that must otherwise begin at age 73 (or 75 for those born in 1960 and later).
Note the word 'directly.' The transfers must go straight from the IRA to the charity, without passing through your hands. The IRA custodian will be the one to send the money, either through electronic transfer or check.
Liz Weston, Certified Financial Planner, is a personal finance columnist. Questions may be sent to her at 3940 Laurel Canyon, No. 238, Studio City, CA 91604, or by using the 'Contact' form at asklizweston.com.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Fast Company
3 hours ago
- Fast Company
The CBO has released estimates revealing Trump's impact on the poorest and richest Americans
President Donald Trump's tax and spending law will result in less income for the poorest Americans while sending money to the richest, the nonpartisan Congressional Budget Office reported Monday. The CBO estimates that the 10% of poorest Americans will lose roughly $1,200 a year as they experience restrictions on government programs like Medicaid and food assistance, while the richest 10% of Americans will see their income increase by $13,600 from tax cuts. Overall, American households will see more income from the tax cuts in the legislation, including middle income households, but the largest benefit will go to the top 10% of earners. The CBO's report comes as lawmakers are away from Washington, many taking their messages about the bill to voters. Republicans muscled the legislation — deemed 'the big, beautiful bill' by Trump — through Congress in July. Democrats all vehemently opposed the legislation, warning that its tax cuts and spending priorities would come at the expense of vital government aid programs and a ballooning national debt. 'This really is a big, beautiful bill for billionaires, but for the poor and the working class in this country, you are actually poorer,' said Rep. Brendan Boyle, the top Democrat on the House Budget Committee, in an MSNBC interview on Monday. Changes to eligibility for government food assistance under the law will impact millions of Americans, the CBO found. Roughly 2.4 million people won't be eligible for the Supplemental Nutrition Assistance Program under new work requirements for many recipients. Low-income Americans could also see their income reduced through further restrictions on food aid and other types of assistance included in the law. Already, more than 10 million Americans are expected to lose health insurance by 2034 due to changes to Medicaid under the law. Following release of the report, Rep. Jason Smith, the Republican chair of the House Ways and Means Committee, said he took issue with CBO's methodology, repeating criticism he has made in the past. 'CBO has a troubled track record of getting its estimates incorrect and, like Democrats, is biased in favor of more federal spending and higher taxes,' Smith said on social media. 'Don't buy it.' Republicans have been eager to sell the upsides of the legislation — arguing that the tax cuts will spur economic growth — while they are on a monthlong summer break from Washington. But those who have held townhalls in their home districts have often been greeted by an earful from voters and activists. 'Tax the rich,' the crowd in Lincoln, Neb. chanted last week as Republican Rep. Michael Flood attempted to defend the bill. Still, Trump has been undeterred. 'President Trump's One Big Beautiful Bill is putting America First like never before, delivering huge savings for hardworking families, boosting our economy, and securing our borders,' said White House deputy press secretary Abigail Jackson in a statement last week.
Forbes
4 hours ago
- Forbes
How The 2025 Budget Act Accelerates Social Security's Insolvency
The Social Security actuary projects the 2025 budget law Congress passed in July will accelerate insolvency of the program's retirement trust fund from early 2033 to late 2032. That may seem like a modest change, but it has enormous political implications. It means the program will go insolvent during the term of the president who succeeds Donald Trump. That soon. And it means that, without congressional action, scheduled benefits would automatically be cut for all recipients by roughly one-fifth right in the midst of the 2032 election campaign. My Urban Institute colleagues Rich Johnson and Karen Smith estimate that once the trust fund becomes insolvent, monthly benefits for a median income retiree would drop by nearly $500 in 2022 dollars and 3.8 million more seniors would fall into poverty. Fortunately for both Social Security and Medicare finances, the budget bill did not repeal income taxes on Social Security benefits, despite the Administration's persistent claims. Without that revenue, their prospects would be much more dire. Taxing combined income But how did the budget bill weaken the trust fund's health? Bear with me. It is complicated. The Social Security trust fund is financed by payroll taxes, the interest it earns on the government bonds it purchases, and from that tax on Social Security benefits. Up to half of Social Security benefits are taxable for single filers with income between $25,000 to $34,000 and for joint filers making $32,000 to $44,000. Up to 85 percent of Social Security benefits are subject to income tax for single filers making at least $34,000 or joint filers making $44,000 or more. And here is the important part: Income for the purposes of this benefit tax is defined as 'combined income,' which includes half (or 85 percent) of your Social Security income plus Modified Adjusted Gross Income (MAGI), which is Adjusted Gross Income (AGI) plus tax-free bond interest and a few other relatively rare income sources. How the new law weakens Social Security The budget law reduces trust fund income because it reduces taxable income, pushes some people into lower tax brackets, and lowers marginal tax rates. Several provisions lower the tax rate on benefits. First, the new law extends the rate cuts and lower tax brackets created by the 2017 Tax Cuts and Jobs Act but were due to expire at the end of this year. Second, the budget law creates a temporary $6,000 senior deduction for taxpayers aged 65 or older. It phases out starting at $75,000 for singles and $150,000 for joint filers and is gone entirely at $175,000 for singles and $250,000 for couples. Combined, these provisions reduce the tax on Social Security benefits. In the short run, that helps some older adults, especially those making between about $80,000 and $130,000 annually. But in the long run, it could be very bad for Social Security recipients, both the 55 million getting benefits today and those working-age people who hope to receive promised benefits when they reach old age. Insolvency Social Security's actuaries estimate all the budget law's changes will drain nearly $170 billion from the Social Security trust fund between 2025 and 2034. And that will be enough to speed up the Old Age and Survivors Insurance fund's insolvency date into 2032. The projected insolvency date often fluctuates based on short-term economic trends. But three current factors could accelerate insolvency even more: President Trump's tariffs, which may already be slowing the economy; his efforts to deport masses of immigrants, who contribute to Social Security by paying payroll taxes even though undocumented immigrants cannot collect benefits; and the real possibility that Congress will extend the new senior deduction, which is due to expire in 2028. Benefit reductions would have severe consequences for older adults, especially those with low incomes. Ironically, many will get little or no benefit from the tax cuts. For example, a widow with income below $17,000 under the pre-July 4 law already owed no income tax for 2025. That higher senior deduction and continued rate cuts do her no good. But she will be harmed substantially to the degree these changes result in a quicker automatic across-the-board cut in Social Security. That income loss may be exacerbated by other Trump Administration initiatives that will increase Medicare costs or limit health care access. Most retirees deduct their Medicare premiums from their Social Security benefits and higher premiums or other health care costs will leave them with less money to pay daily expenses. For now, few politicians are willing to support the tax increases and benefit reductions that will be necessary to at least delay Social Security's pending insolvency. And President Trump insists he won't touch Social Security, though the budget law he pushed clearly did, and in the wrong direction. If the Social Security actuary is right, Trump's successor won't have the option to ignore Social Security. Unless the next president 'touches' it with substantial reforms, the retirement system will fall far short of paying promised benefits. At the very least, lawmakers could stop making matters worse.
Business Wire
4 hours ago
- Business Wire
Vitable Health Expands Care-Backed ICHRA Platform to Pennsylvania, Texas, and Florida Amid Rising Demand for SMB Health Benefits
PHILADELPHIA--(BUSINESS WIRE)-- Vitable Health, the leading all-in-one health benefits platform redefining care for the American workforce, today announced the availability of its care-backed ICHRA (Individual Coverage Health Reimbursement Arrangement) services in Pennsylvania, Texas, and Florida. This expansion follows the company's successful launch in Ohio and reflects growing demand from small businesses for health benefits that actually deliver care, not just coverage. As healthcare costs rise and small businesses continue to be left behind by traditional group insurance models, ICHRA adoption is accelerating across the country. New U.S. Census Bureau data, analyzed by BenefitsPro, shows that Florida and Texas are among the states with the highest uninsured rates, underscoring the urgent need for solutions that help employers close coverage gaps. According to the most recent HRA Council report, 83.5% of employers offering an ICHRA or QSEHRA did not provide any health benefits prior—a sign of the model's potential to expand access where it's needed most. 'Legislation will always lag behind reality,' said Joseph Kitonga, CEO of Vitable Health. 'This expansion is about more than geography, it's about proving that small businesses don't need to wait for lawmakers to fix the system. Affordable, high-quality healthcare for the working class isn't theoretical. It's here, it's working, and it's only the beginning.' In many of these markets, small businesses are facing what Vitable Health calls 'coverage deserts,' where traditional plans have become cost-prohibitive or inaccessible. By combining ICHRA administration with unlimited virtual primary care, preventive screenings, diagnostic lab panels, and zero-dollar prescriptions, Vitable removes the friction that typically keeps benefits and care siloed. This integrated model simplifies compliance for employers while improving health access and engagement for employees, particularly in industries like home health, construction, and hospitality, where coverage has historically been out of reach. In Pennsylvania, where Vitable Health is headquartered, this expansion marks the next stage of growth in the company's largest and most mature market. In Texas and Florida, two of the country's most challenging benefits environments, Vitable Health is helping employers deliver a competitive edge by pairing cost-efficient ICHRA benefits with real care. 'With Ohio's HB 133 and Indiana's HB 1004 setting the tone and ICHRA bills surfacing in other states, the message is clear: change is coming,' Kitonga added. 'The employers who act now aren't just getting ahead of the curve—they're leading it.' With this multi-state expansion, Vitable Health is demonstrating what a new standard for small-business health benefits looks like: affordable, accessible, and centered on real care rather than bureaucracy. To learn more about Vitable Health's ICHRA and primary care offerings for small businesses, visit Vitable Health is the nation's leading health benefits platform, making healthcare better for business owners and employees. With a focus on real access over red tape, Vitable Health offers employers affordable, ACA-compliant health benefit solutions, including Minimum Essential Coverage (MEC) plans, MVP plans, and ICHRA and QSEHRA options, that are packaged with Direct Primary Care and can be enhanced with Vision and Dental benefits. Every plan includes access to virtual primary care visits, mental health coaching, and over 1,000 covered prescriptions and labs with zero out-of-pocket costs. To date, Vitable Health has raised $25 million from top-tier investors, including First Round Capital, Y Combinator, Cherryrock Capital, Citi Bank's Impact Fund, Commerce Ventures, Jack Altman, Michael Seibel, Immad Akhund, and SoftBank Opportunity Fund.
