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                                   Understanding you income taxes

2008 can't end soon enough for most of us. The economy decided not to wait for New Year's to start binge
drinking, and promises to usher 2009 in with one monumental hangover. The economic news isn't just
getting worse, it's getting weird. Case in point: apparently, the new status symbol in New York is getting
ripped off by Bernie Madoff -- with the "status," of course, being the clout that investors needed to get in
on Madoff's Ponzi scheme in the first place. Weird!

“The hardest thing in the world to understand is the income tax.” - Albert Einstein

The bad news is, the tax code is so complicated even Albert Einstein couldn’t understand it. The good news
is you don’t have to be Einstein to cut your taxes. You just have to know how the system works for you –
your job or business, your investments, and your family.

At Great Lakes Tax Advisors, our planning offers you strategies to do just that. All of us know what we
have to do to figure our taxes: add taxable income from all sources, subtract “adjustments to income”,
subtract standard or itemized deductions and personal exemptions, consult table of tax brackets to figure
your tax and subtract any available credits to figure your refund, or tax bill. That’s really most of what you
need to know, the real issue isn’t the numbers.

The real issue to reducing, or controlling your taxes is what you have to include in your income, what you
get to deduct from that income, and where you invest to receive income that is not required by IRS law to
be recorded at all. That part isn’t as simple. It’s also where most people slip up! And that’s just on the
income side!

The Declaration of Independence says that all men are created equal. But not all income is created equal.
Pay attention to these important exceptions to the general tax rates:

   Self-employment income from proprietorships, partnerships, and limited liability companies is taxed at
15.3% up to the Social Security wage base ($102,000 for 2008) and 2.9% on income above that base. This
is on top of regular income tax and replaces Social Security for self-employed taxpayers.

  Long-term capital gains from the sale of property held more than 12 months are generally taxed at no
more than 15%.

  “Qualified corporate dividends” are taxed at no more than 15%, regardless of your tax bracket.

  “Kiddie tax” is a special tax at your marginal rate on unearned income over $900 paid to children and
grandchildren under age 19 (or full-time students under age 24).

  Alternative minimum tax is a parallel tax intended to stop “the rich” from escaping tax entirely.

  Don’t forget state and local taxes!

If you can plan ahead and pro-actively minimize the “negative” impact of these tax rates, and/or maximize
their “positive” impact, you will save yourself, your business, and/or your family an enormous amount of
money over the long term. That is what our Pro-Active tax planning approach is meant to do.

At Great Lakes Tax Advisors, our tax advisors specialize in personal tax planning, family
legacy/partnerships, and small business tax planning and bookkeeping. To learn more about how our
advisors can positively impact your taxes, call us today to schedule a complimentary consultation:
 (800) 801-0091.
                                           Your Fiscal Health

          When was the last time you looked at your life insurance coverage?

          ow long has it been since you sat down with a calculator and considered your loved one’s

H         financial needs? If it’s been a while, you’re in good company. Most of us craft our life insurance
          programs with care when purchasing a policy, then forget to revisit the subject as times change. Of
          course, it’s only natural to avoid thinking about the possibility of our death. Still, the payoff can be
worth the extra effort it takes to perform a periodic review.
Staying Current. If it’s been more than five years since your last life insurance checkup, you may be
missing opportunities to take advantage of newer life insurance policies that are more cost-effective and
competitive. Policies purchase years ago may not be capable of fulfilling your current needs. Changes in
the life insurance industry in recent years should inspire you to review your coverage. Interest rates that are
being credited to your old whole and universal life policies may have decreased, making your current
policy less cost-effective than newer policies that could possibly provide equal coverage with lower
premiums. However, with a new policy you will face a new suicide clause and incontestability period. You
don’t want to leave your heirs legal and tax problems that could have been avoided. Beneficiary
designations will override a will, so it is important to review your beneficiary designations on your life
insurance policies.
Rule of Two. Use the “Rule of Two” when naming your beneficiaries. Name TWO backup beneficiaries
for every person named. If the primary beneficiary dies before the insured, failure to name a contingent
beneficiary may cause the assets to go into probate where there is a risk of higher costs and creditor access.
Many life insurance policies lack a contingent beneficiary or simply have the estate as the beneficiary.
Tax Advantages. One of the major planning errors of a life insurance policy is improper ownership. This
error can possibly result in higher estate taxes being levied. Your life insurance professional can show you
ways to exclude your life insurance death benefit proceeds from estate taxes.
Check up Triggers. Review your existing life insurance policies and investment accounts if you have
experienced any of the following:
    Marriage
    Loss of a spouse
    Marriage or divorce of one of your heirs
    Birth or adoption of a child or grandchild
    Retirement
Benefits of a Check up.
    The opportunity to take advantage of newer and more cost-effective life insurance
    Ensure appropriate and accurate beneficiary designations.
    Realign your insurance needs with your current life situation
    Ensure your policy doesn’t lapse because of drastic change in interest rates.

If you have life insurance that is older than 5 years old, Call today for a review of your
coverage and policy limitations.

Best Wishes,
Carl                                           Jason
Carl Cryderman                                 Jason F. Cryderman

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