March 2013

Why some doctors bill Medicare patients more than others

If you have original Medicare, then choosing which doctor you visit can make a big difference in how much you have to pay. Under Medicare Part B, which pays for doctor visits, once your annual deductible is met, Medicare pays 80 percent of what it considers a “reasonable charge” for the item or service. You’re responsible for the other 20 percent. However, in most cases, what Medicare calls a “reasonable charge” is less than what a

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Five things to discuss with your spouse before you retire

You may have a vision for your retirement, but does your spouse share that vision? A recent study by Fidelity Investments found that many couples are not in accord about retirement. For example, one-third of couples approaching retirement disagree about or don’t know where they are going to live after they retire, and 62 percent don’t agree on their expected retirement ages. Here are some important things to discuss with your spouse as you get ready to retire:

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Tax deductions for long-term care insurance are increased

The amount you can deduct on your taxes as a result of buying long-term care insurance has been increased by the IRS for 2013. If you itemize your deductions, you can generally deduct part of your premiums if the premiums, together with your other unreimbursed medical expenses, amount to more than 10 percent of your adjusted gross income (or 7.5 percent if you’re age 65 or older). The maximum amount of premiums you can deduct each

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Average private nursing home room is $90,520 a year

The cost of long-term care increased significantly in the past year, according to a new survey by MetLife. The cost of a private room in a nursing home jumped 3.8%, to an average of $90,520 a year. That works out to $248 a day. The cost of a semi-private room increased by 3.7% to $81,030 a year, or $222 a day. The average cost for an assisted living facility rose 2.1%, to $42,600 a year. And

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Medicare expands coverage for chronic conditions

In a major change, the federal government has agreed to provide seniors who have chronic illnesses and disabilities with Medicare coverage for many services … even if those services will simply maintain the person’s present health status and aren’t likely to improve their condition. This is very important news for people who have diabetes, heart disease, Alzheimer’s disease, multiple sclerosis, Parkinson’s disease, Lou Gehrig’s disease, arthritis, or the effects of a stroke, among other medical conditions.

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Many estates can save money by filing tax returns – even if they don’t have to

A federal estate tax return doesn’t have to be filed every time someone dies. In fact, most estates never have to file one. However, a provision in the new “fiscal cliff” tax law may make it very advantageous to file an estate tax return if the deceased person is survived by a spouse – even if a return is not legally required. Here’s why: Generally, when a person dies, his or her estate can give an

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Roth 401(k) plans get a big boost in the new tax law

The new tax law that resolved the “fiscal cliff” issue in January allows employees with a 401(k) plan at work to roll over any or all of the assets in their current plan into a Roth 401(k) plan. This is a big change, and should at least be considered by anyone who is eligible. In a traditional IRA or 401(k) plan, employees contribute pre-tax earnings to the plan. The assets grow tax-free until retirement age, at

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Annual gift tax exemption has been increased to $14,000

The annual gift tax exemption has been increased to $14,000 in 2013, up from $13,000 last year. That’s due to an adjustment for inflation. This means that you can give any person $14,000 this year without any gift tax liability at all. Making annual gifts of the exemption amount is one of the best and easiest forms of estate planning, because it transfers assets from one generation to the next without any tax liability whatsoever. If

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How the new federal tax law will affect your estate planning

In a big surprise to many people, when Congress passed a law to resolve the “fiscal cliff” in January, it retained the large ($5 million-plus) estate, gift, and generation-skipping transfer tax exemptions that had been available in 2011 and 2012. These taxes will now be 40% of amounts over this exemption. Without this new law, the exemptions would have dropped to only $1 million at the start of 2013, with a tax rate of 55%. The

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