ES Payment Reminder … Confirming another “NEW” RMD (Required Minimum Distribution) age of 73 … First Week in the Books … Was a busy but good one!

Attention all ES IRS payment filers….January 17th is our due date this year for our Q4 2022 Estimated taxes!

With continued slow mail, we still like to direct everyone to the electronic filings of your state and the Federal payments system.

Tax Due Dates

Payment Due Dates


You can pay all of your estimated tax by April 18, 2022, or
in four equal amounts by the dates shown below.
1st payment . . . . . . . . . . . . . . . . . April 18, 2022
2nd payment . . . . . . . . . . . . . . . . June 15, 2022
3rd payment . . . . . . . . . . . . . . . . . Sept. 15, 2022
4th payment . . . . . . . . . . . . . . . . . Jan. 17, 2023*

  • You don’t have to make the payment due January 17,
    2023, if you file your 2022 tax return by January 31, 2023,
    and pay the entire balance due with your return.

Electronic Payment of ES Taxes

Here is the IRS tax website link, which is very easy to make electronic estimated taxes. Be sure to follow the instructions carefully as there are a lot of different options for making payments to taxes, and be sure to carefully enter your personal information so the IRS knows it’s you.

RMD Changed (again) this time to 73

As mentioned earlier, those turning 72 in the year of 2023, your new RMD age starting time is now 73! yay…. boy do they keep moving this target… at least farther out!

Hope you had a Great first week of the year… we were busy as expected, thanks for your patience on any delays!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

December 2022 Financial Planning and Capital Market Review – Secure Act 2.0 – By John Kvale CFA, CFP

Hello and Welcome to our December 2022 … Financial Planning and Capital Market Update!

If you are too busy to read, feel free to listen as we describe our post and thoughts in friendly podcast audio format as well as Video!

Newbies –

We like to articulate our thoughts and review on a Monthly basis our Financial Planning Tips, Capital Markets thoughts and current events!

Hope you enjoy!

December 2022 Video


YouTube

Financial Planning Tip(s)

Secure Act 2.0 – Passed on 12-27-22 Quietly …. Shhhhh we are working through the details

On December 27, 2022 a HUGE bill … over 4000 pages, was passed…. while not sweeping in our neck of the woods, there is one main adjustment….

RMD – Required Minimum Distributions are pushed out again to age 73! Not Kidding!

Capital Market Comments

Rate Increase – Fed Raised rates for the Holidays

In December the FOMC (Federal Open Market Committee) led by Jerome Powell raised rates, but only by .50% … but it was a raise…

Have a Great Day, Talk to You at the End of January – Happy 2023!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

Happy New Years! A Simple Start to 2023!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

Q1 2023 J.K. Financial, Inc. Newsletter … Estate Tax Law change Heads Up …. Higher Rates for Longer from Stubborn Lagging CPI Inputs … Personal Reflection … By John Kvale CFA, CFP …

Welcome to our Video and Audio Podcast Review of our Q1 2023 Newsletter. For those on the road or just unable to grab the time to read, our podcast type review gives you the behind the scenes insight to our thoughts, observations and deep views of the entire Newsletter.

Click the Download button below, for a direct link to an electronic version (an early peek-good ole fashion paper versions are on their way to you shortly) and here for our Newsletter page

Let’s get going! We hope you enjoy!

Q1 2023 Newsletter

(YouTube)

Personal Reflections –

Entering the 36 year in the Financial and Capital Markets world, a lesson was learned this year (see below) we want to thank everyone for their well wishes, patience and confidence as we went through a unique “Changing of the Tiger Stripes” event this year!

Higher Rates – Longer – CPI Stubbornly High

CPI Causes Tiger Stripes to Change?

Very Lagging Rent and Shelter Numbers keep pushing CPI

Estate Tax Laws Set to Change – Heads Up

At the end of 2025, putting January 1, 2026 into play, without any tax law adjustments the Estate Tax level will adjust back down to somewhere between a $7 to $8 million or $14 to $16 million for couples level. 

While Estate Tax is not a huge revenue earner for the IRS, in our opinion Estate tax is in purpose is to affect the very largest of the states think  $100 million and up. 

Additionally the IRS is having trouble completing regular federal tax returns, by some estimates some 15 to 20 thousand taxpayers are still waiting on their regular federal returns to be blessed by the IRS from 2020 to present.  Lowering the Estate Tax level to an extreme low, while may sound good in the headlines, impracticality, it will likely create a huge bottleneck and more trouble than money earned. 

Bottom Line – We are on this in advance!

Happy New Years and a Great Start to 2023!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

REVIEW REWIND REPLAY – Shrinking the Balance Sheet Explained, Bulking and Lowering too

This post is clearly dated…. BUT it is actually what current chair Jerome Powell is doing today in addition to raising rates! Enjoy the replay review!

Last Wednesday Janet Yellen, FOMC (Federal Open Market Committee) chairperson released comments on their duty as Federal Reserve members but also introduced a term that may be new to many.

“Shrinking the Balance Sheet”

What is the Balance Sheet

Much to the happiness of all those bookkeeper, accountants, CPA’s and the like, present party included, entries must balance.  Even the US Government as huge as it is, runs by the old adage

Assets = Liabilities + Equity

A basic accounting principal, that MUST always work…

If a change is made, it must be counted somewhere else, even on the USA’s balance sheet.

Bulking up the Balance Sheet

Post “Great Recession of 07-09” FOMC members smartly embarked on a successful but unknown effort at the time, of infusing banks and capital markets with Greenbacks aka $ Dollars!

The Federal Reserve led by FOMC members, with the click of a button created money in their checking account and created a contra account for balancing purposes then went out to capital markets and bought bought bought in HUGE quantities various capital instruments, but for the most part US Bonds of all maturities.

Their goal, again unchartered territory at the time was to infuse money into the system and also lower interest rates.

By  purchasing large quantities of instruments the FOMC were putting dollars directly into the system … there were other programs as well, but for the sake of simplicity, their buys pushed money into, at the time, a much needed financial system.

The numbers of this chart are not as important as the line and dates.

img_0874

As the FOMC clicked and bought and clicked and bought again in keeping their books “Balanced” the Federal Reserve Bank Assets Grew and Grew.

Finally the Sizzle, Shrinking the Balance Sheet

Take a peek at the far right of the line in the chart… Come on now you can do it …. this is important, and you have come this far …

What do you see? It’s flat lining….

Since most of the FOMC purchases were bonds of various types, and bonds mature, that line should begin to decrease. The FOMC holds such a huge portfolio of bonds, maturity occurs almost constantly.

Until now, the FOMC has re-invested or repurchased maturing bonds with new bonds, thereby holding that line flat. Yellen and crew are now signaling they may NOT re-invest those maturing bonds, which would lead to a VERY SLOW decline in the FOMC balance sheet or a …

“Shrinking of the Balance Sheet”

These words have been carefully chosen. Eventually the FOMC may actually sell their bonds back into the capital markets, reversing the stimulus applied in the “Great Recession of 07-09” more quickly. That would not be called “Shrinking” that would be called lowering, reducing, or something similar, look for this type of cryptic rhetoric in the future …. for now, shrinking simply means letting the maturing bonds mature and NOT re-investing … Shrinking the Balance Sheet !

There you have it, this post turned longer than expected, but the background should have made for a clearer picture … if you made it this far, pat yourself on the back… You now know the current “Shrinking” step along with likely future announcements by the FOMC and committee members!

Have a Great “Deciphering Cryptic FOMC Rhetoric” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

Seasons Greetings, Happy Holidays, Merry Christmas …. Financial stuff “Heads Up” Secure Act 2.0!

Wishing everyone a Season’s Greeting, Happy Holidays and a Merry Christmas!

As a “Heads Up” in the Financial world, there is a Bill (Secure Act 2.0 aka HR 2954) going through Congress that is likely to pass before years end … Recall in late December of 2019 Secure Act 1.0 was passed and signed into law, only to be lost in the multitude of laws around the virus and relief…

While not into law yet…. a few high points include:

Another increase in RMD (Required Minimum Distributions) age to 73 – currently age 72

401k and other similar increased contribution levels

Will keep you posted… but wanted to let you know we are watching closely!

Best Wishes and Have a Safe and Happy Holidays!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

YEAR END REPLAY – Fastest Interest Rate Increases Ever, and that’s a long time … Friends at Visual Capitalist!

Wanted to replay this post as it is unusual to have a “Never Before” Event this day and age !

From our friends at Visual Capitalist

This is pressure for now, but pleasure as our income from our fixed pays out more!

When the Fixed Income market breathes, rates typically go down in a slowdown…. even with the Fed raising short term rates… actually especially when they raise short term rates…

Have a Good “Temporary Pressure Eventual Pleasure” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

YEAR END REPLAY REMINDERS – 8.7% Social Security COLA, Peripheral Effects, Pension COLA Reminder, SSA Neat Fact Sheet …

Last year we penned the following … in this post

HUGE Social Security COLA … 5.9% to Be Exact, Wow…. COLA Pension Recipients Check Your Benchmark

Looks like that was just the dress rehearsal… here is this years release…

Dall – E

With much talk of Inflation costs this year, the SSA (Social Security Administration) release this week of an 8.7% COLA (Cost of Living Adjustment) was not a huge surprise..

Important Items Associated with this Adjustment

Pensions – Folks with Pensions that have COLA adjustments should also watch for a similar increase – Your benchmark and adjustment will likely differ from SSA as they use the CPI-W three month average as noted here in our pre-post last year

Pre-Retirees – Those nearing Social Security, according to this neat fact sheet,

Maximum Social Security Benefit: Worker Retiring at Full Retirement Age goes from $3,345/mo. to $3,627/mo.

New Social Security Tax Base – Those still working, understand this COLA also filters into the SSA base income tax rate, again as mentioned in the press release

“Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $160,200 from $147,000.”

Have a Great “COLA Reminder” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

Happy Holidays … Gentleman’s Agreement Held? Will see … Mostly Out of Office Over the Holidays … Link to TV Post …

Happy Holidays ….. Over the remaining days of the year, there is a “Gentlemen’s Agreement” to basically do no harm…. this agreement was violated in 2018 by Guess who? Non other than an aggressively increasing rates FOMC (Federal Open Market Committee)

Not sure if you caught the news on Wednesday but the afore mentioned FOMC raised rates by .50% this week…

Not sure how this plays out, but Jerome Powell (FOMC chair) may not be bringing presents….

Holidays Out of the Office

While we will have electronics… (we always have electronics) …. we are planning on being out of the office most of the Holidays …

For the safety of the streets, with all of our gangs getting out mid day, we will also be out mid day…

Oh… here is the link to Wednesdays post here on our blog….forgot Youtube embeds do not make it through email servers these days….

Happy Holidays and Seasons Greetings!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

Most Popular TV Series 1986-2022 – Great Observation … A Challenge … From Data is Beautiful … Animated

While today is a Jerome Powell raise rates day…. we promised a lighter run into the end of the year unless otherwise necessary….

Couple of Challenges on this one … takes a while to get through the entire animation… but if you do, take note of a few items… this from Data is Beautiful YouTube Website

Check out the tone/subject matter of the early 90’s versus 2020 and to current?

Had no idea how popular NCIS was… Wow!

Did you figure out the difference between early years and now? In the late 80’s and early 90’s most popular Series were Comedy…. today, very hard core serious along with lots of death…. hmmmm… Good ole days!

Have a Great “Lighter Most Popular TV Series” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents