Currently, the federal estate tax exemption for an individual is $11,580,000 and $23,160,000 for married couples. While this federal exemption will increase with inflation until 2025 if Congress does not renew this bill, the estate tax exemption limit will fall to around $3,500,000 per individual. The following are three simple steps you might consider now to reduce or avoid the federal estate taxes.

1. Gift Assets While you are Alive either to a family member or charity

Minimize your estate tax liability by gifting or transferring some of your assets while you are still alive. You can also donate any amount to charity and receive tax breaks for these contributions. You are permitted to gift up to $15,000 per donor and per recipient tax-free each year.

2. Buy Life Insurance Now and Use the Benefit to Pay the Tax

The earlier you purchase this insurance, the better as you can secure a death benefit amount to cover the majority of any estate taxes you may have to pay. Though this estate planning strategy does not help you avoid estate taxes, it makes paying the tax easier for your family.

3. Set up a Donor Advised Fund

A Donor Advised Fund is a great estate planning tool as any assets you put in this trust are not counted towards your total estate value. This account allows your investments to grow tax-free as they are set aside for a charity. However, unlike a normal trust, you remain in control of the money in this account until you decide you want to donate it.

Privileged & Confidential
Douglass Financial Services – Substitute Notice
March 8, 2022

NOTICE OF DATA SECURITY INCIDENT

Douglass Financial Services (“Douglass Financial”) recently learned about a data security incident that may have impacted your personal information. Specifically, the incident in question may have resulted in the disclosure of your personal information including, but not limited to name, address, date of birth, driver’s license number, Social Security number, medical information, and financial account information. Douglass Financial is an independently owned financial consulting firm serving clients in Central Illinois. At Douglass Financial, we respect the privacy and security of all information within our control, and sincerely apologize for any concern this may cause you.

What happened?

On September 29, 2021, Douglass Financial learned of suspicious activity associated with one of its corporate email accounts. As soon as Douglass Financial learned of the incident, it began an internal investigation and hired a third-party vendor to conduct an in-depth review of the email account to determine what personal information may have been located in the account, and to extract contact information of potentially affected individuals. This review was completed on January 28, 2022, at which point Douglass Financial identified that the personal information of individuals may have been located in the corporate email account at issue. While Douglass Financial has no evidence that any personal information has been misused it is providing this notice out of an abundance of caution.

What information was involved?

The categories of personal information that may have been impacted include first and last names, addresses, date of birth, driver’s license number, Social Security number, financial information, and medical information.

What are we doing?

To help reduce the risk of fraud or identity theft, we are offering complimentary credit monitoring and identity monitoring services for one year, at no charge.

Additionally, in response to this incident, Douglass Financial has taken steps to increase the security of its systems including, resetting passwords, enabling multi-factor authentication across all Douglass Financial corporate email accounts.

What can you do?

It is always a good idea to carefully monitor your bank account and other financial statements, and immediately contact your financial institution if you identify any suspicious activity. All adults whose Social Security numbers may have been involved in this incident are being offered complimentary identity protection services through Kroll for 12 months. We encourage you to contact Kroll with any questions and, if your information was present in the impacted dataset, take full advantage of the Kroll service offering. To determine whether you were affected by this incident, please call 1-855-541-3553, Monday through Friday from 8 am – 5:30 pm Central Time.

For more information:

If you have any questions or concerns, please call 1-855-541-3553, Monday through Friday from 8 am – 5:30pm Central Time. Your trust is our top priority, and we deeply regret any inconvenience or concern that this matter may cause you. Individuals can also contact the Federal Trade Commission at 600 Pennsylvania Avenue NW, Washington, D.C. 20580, 1-877-ID-THEFT (1-877-438-4338); TTY: 1-866-653-4261 or visit www.ftc.gov/idtheft/ for more information on protecting their identity.

The IRS's Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs offer free basic tax return preparation to qualified individuals.

The VITA program has operated for over 50 years. VITA sites offer free tax help to people who need assistance in preparing their own tax returns, including:

• People who generally make $58,000 or less

• Persons with disabilities; and

• Limited English-speaking taxpayers

In addition to VITA, the TCE program offers free tax help, particularly for those who are 60 years of age and older, specializing in questions about pensions and retirement-related issues unique to seniors.

While the IRS manages the VITA and TCE programs, the VITA/TCE sites are operated by IRS partners and staffed by volunteers who want to make a difference in their communities. The IRS-certified volunteers who provide tax counseling are often retired individuals associated with non-profit organizations that receive grants from the IRS.

VITA/TCE services are not only free, they are also a reliable and trusted source for preparing tax returns. All VITA/TCE volunteers who prepare returns must take and pass tax law training that meets or exceeds IRS standards. This training includes maintaining the privacy and confidentiality of all taxpayer information. In addition to requiring volunteers to certify their knowledge of the tax laws, the IRS requires a quality review check for every return prepared at a VITA/TCE site prior to filing. Each filing season, tens of thousands of dedicated VITA/TCE volunteers prepare millions of federal and state returns. They also assist taxpayers with the preparation of thousands of Facilitated Self-Assistance returns.

Bloomington Housing Authority
104 E. Wood Street
Bloomington, IL 61701
309-830-4832
Volunteer Prepared Taxes
Get Directions and Service Details
January 31 - April 9, 2022

Normal Township ARC
600 East Willow St.
Normal, IL 61761
309-888-9099
Volunteer Prepared Taxes
Get Directions and Service Details
February 11 - April 8, 2022

We have been reading a lot about what the experts think might be in store for 2022, and it seems that many remain cautiously optimistic (even in light of the challenging start!). They feel that the backdrop remains in place for the economy to continue to bounce back and heal from COVID, with relatively low interest rates and strong consumer spending.

Of course, everyone is keeping an eye on how inflation could impact that and how well the Fed will manage the need to raise interest rates from these historically low levels. And no one quite knows how this next phase of the pandemic will play out or whether other factors, like geopolitical threats (e.g. the Russia/Ukraine situation) or the ongoing polarization in Washington, will be bigger impediments to economic growth than expected.

The good news is that managers are still finding pockets of the market where they think money can still be made without taking outsized risk. That might be more challenging in the fixed income markets, but we will look to our trusted partners in that space to help us manage through. We will continue to provide our perspective as we move through the year and encourage you to reach out as you have questions or concerns.

Since I (Darrell) turned 50 last year, I am now keenly aware of the changes to catch up provisions allowed by IRAs, Roth IRAs & 401k/other employer retirements plans. One of the perks of getting older I guess!

For 2022, here are the allowable contributions to those plans:

• Traditional IRA: $6,000 + $1,000 Catch Up if Age 50 or older

• Roth IRA: $6,000 + $1,000 Catch Up if Age 50 or older

• SIMPLE IRAs: $14,000 + $3,000 Catch Up if Age 50 or older

• 401k/403b/457: $20,500 + $6,500 Catch Up if Age 50 or older *

  * for 403b and 457, catch up may be capped

The start of the year is a great time to assess whether you can increase your retirement deferrals or contributions, especially if you have reached that magic Age 50 threshold.

Here’s to a great start to the year!!!!