IN THE KNOW
Monthly Newsletter
July 2020
At ML&R Wealth Management , we want to ensure our clients are In The Know.

In this month's newsletter we are looking at 529 Plans and possible tax risks due to COVID-19. We are also sharing helpful COVID-19 resources from our parent company, Maxwell, Locke & Ritter, and relevant investment articles and videos from Dimensional.

We are a firm that understands that managing your assets is about more than money. It is about empowering your future. At ML&R Wealth Management, we focus on you.
Rachel Roth , Wealth Management Advisor Associate

The college experience was redefined in the Spring of 2020 as classes went online and dormitories closed due to Coronavirus concerns. Many colleges and universities issued a partial refund of tuition and room and board. If you used your child’s 529 plan to pay these expenses in the Spring of 2020 and your student was issued a refund, the IRS says it needs to be put back into your 529 account or the account owner could face tax penalties at the end of the year. Since the refund is not being used for qualified expenses, it could be recharacterized as taxable income to the account owner (usually a parent). This could mean a 10% penalty and income taxes on the earnings portion of the returned distribution amount.  

Financial Wellness Q&A
In this section we will address common personal finance questions. Email  wealth@mlrpc.com  if you have a question you would like answered.

Question:  What if my child doesn’t go to college or vocational school?

Answer:   You can change the beneficiary of your account to another family member - a sibling, cousin, grandparent, aunt, uncle or even yourself. If your child changes their mind later down the road, as the account owner, you can convert it back. You can also take a non-qualified distribution at any time for any reason (taxes and penalties will apply). 


Question: Do I have to use my home state’s plan?

Answer:  No. You are free to choose any state plan. We recommend you look for plans that offer state income tax incentives and low program and mutual fund fees. 

As the novel coronavirus (COVID-19) continues to spread in the U.S. and across the world, our priority at Maxwell Locke & Ritter is the safety and well-being of our people, clients, families, and community. We are monitoring daily updates and recommendations from the CDC. Additionally, we are minimizing the impact that COVID-19 could have on our services and are staying abreast of all filing deadline adjustments. We understand that in this time of uncertainty you may have growing concerns for the financial health of yourselves and your businesses, employees and families. We have curated some helpful resources for you and will continue to update this page as new information and updates occur.


Dimensional research suggests investors should look beyond venues’ fees and rebates to get a complete picture of trading costs.

Dimensional’s approach to trading seeks to reduce implementation costs by participating in the natural trading that occurs in markets each day. “Blending in” requires expertise in pricing, sizing, timing, and routing orders. As markets and technology evolve, we continually conduct rigorous research on different aspects of market microstructure in order to improve our trading algorithms.


We can’t control crises, but we can control our response to them. Dimensional Founder David Booth reinforces the importance of preparing for the unexpected.

David Booth reflects on the pain of history repeating itself and offers hope that this may be the moment when the future bends to the side of justice.

The murder of George Floyd is the most recent in a long line of injustices against the black community in our country. While reflecting on what our firm can do to help, I came upon something my friend and colleague Bill Bradley said nearly 30 years ago on the Senate floor. A jury had just returned the Rodney King verdict, which acquitted four police officers who were caught on videotape beating King with their batons 56 times for 81 seconds.


Crisis brings out the best — and worst — in people. Some dishonest people have already turned the coronavirus (COVID-19) pandemic to their advantage by preying on unsuspecting victims and exploiting their fears.
“History has shown that criminals take every opportunity to perpetrate a fraud on unsuspecting victims, especially when a group of people is vulnerable or in a state of need,” said IRS Criminal Investigation Chief Don Fort.
Here’s an overview of six COVID-19-related scams and practical advice on how to avoid them.

1. Fake Charities
When a catastrophe like COVID-19 strikes, philanthropists flock to donate cash and other assets to help relieve the suffering. But, before making a donation, be aware that opportunistic scammers may set up fake charities to benefit from your generosity.

Fake charities often use names that are similar to legitimate charitable organizations. So, be sure to do your homework before making a contribution. Donors aren’t the only victims to these scams — those in need also lose out.

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What's Happening in Austin This Month

While we know there are no in-person events for the next month, we wanted to share virtual events and activities.
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About ML&R Wealth Management:
At ML&R Wealth Management, we take investing personally. Your ML&R Wealth Management advisor will work to develop a lasting relationship with you, keeping in touch to understand your changing goals and to provide an asset management strategy to help achieve them. Whenever you need sound financial advice, you have a direct line to a trusted advisor.

For over 20 years, we have served individuals, families, businesses, and nonprofits with wealth management services, custom retirement and 401(k) plans, and portfolio management.

We believe in accountability and transparency and operate as a fee-only advisor with fees calculated solely on assets under management.
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