Lantern Wealth Advisors, LLC
35 Pinelawn Road
Suite 101E
Melville, NY 11747
(631) 454-2000
info@lanternwealth.com
https://lanternwa.com/


Major Indexes For Week Ended 3/15/2019

Index Close Net Change % Change YTD YTD %
DJIA 25,848.87 +398.63 1.57 +2,521.41 10.81
NASDAQ 7,688.53 +280.39 3.78 +1,053.25 15.87
S&P500 2,822.48 +79.41 2.89 +315.63 12.59
Russell 2000 1,553.54 +31.66 2.08 +204.98 15.20
International 1,890.31 +51.08 2.78 +170.43 9.91
10-year bond 2.59% -0.03% -0.10%
30-year T-bond 3.02% +0.01% +0.00%
International index is MSCI EAFE index. Bond data reflect net change in yield, not price. Indices are unmanaged and you cannot directly invest in an index.


Despite Crises, Economic Fundamentals Are Strong

Europe's economy slowed sharply, a U.S.-China trade war loomed, fears of a real war with North Korea grew, while U.S. politics sank deeper into chaos, and a gunman massacred at least 49 innocents attending services at a Christchurch, New Zealand mosque, even as they prayed. It was a week of crises.

Since 1957, the internal rate of return on American stocks has been 6.9%, and there were plenty of crises all along the way.

The Standard & Poor's 500 stock index closed at 2,822.48 on Friday, up sharply from 2,743.07 a week ago, and rebounding the close of 2,803.69 two weeks ago.

A key growth investment in a broadly diversified portfolio, the S&P 500 index is volatile, unpredictable, and suffered a 19.8% plunge from September 20th's all-time closing high to the Christmas Eve closing low of 2,351.10. Despite a week when the world seemed full of crisis, U.S. stocks endured and the uncertain struggle toward progress— which can never be guaranteed— continued at its seemingly relentless pace.


This article was written by a veteran financial journalist based on data compiled and analyzed by independent economist, Fritz Meyer. While these are sources we believe to be reliable, the information is not intended to be used as financial or tax advice without consulting a professional about your personal situation. Tax laws are subject to change. Indices are unmanaged and not available for direct investment. Investments with higher return potential carry greater risk for loss. Past performance is not an indicator of your future results.


This Tax-Free Rollover Goes Right To Charity

The tax law provides a unique planning opportunity for retirees who have to take required minimum distributions (RMDs). You're allowed to transfer funds directly from your traditional IRA to a qualified charitable organization without paying any federal income tax on the distribution. Although the contribution isn't tax deductible, it does count toward your RMD for the year.

This tax break—sometimes called a "charitable rollover"—had expired and been reinstated several times. Thanks to the Protecting Americans from Tax Hikes (PATH) Act of 2015, however, the tax provision is now permanent.

Under the PATH Act, someone who's at least age 70—the age at which RMDs must begin—can instruct an IRA custodian to move up to $100,000 of funds from that person's IRA to a favorite charity. A married couple can transfer up to $200,000, assuming they're both old enough to begin taking RMDs.

Can't you accomplish the same result by taking a taxable IRA distribution and then donating that amount to charity? Not exactly. There are several other factors to consider, including annual limits on deductions for donations to charity, plus potential tax return complications. What's more, the direct rollover is valuable to non-itemizers who aren't eligible to deduct charitable contributions. And this method is simpler.

There are, however, a few more details to attend to with this approach. To qualify for the tax exclusion, the distribution must be made directly from the IRA trustee to a qualified charitable organization. You're not allowed to use the funds temporarily before transferring them to the charity's coffers.

In addition, the contribution must otherwise qualify as a charitable donation. If the deductible amount decreases because of a benefit received in return— for example, the value of a dinner at a fundraiser— or the deduction would not be allowed due to inadequate substantiation, you can't take the exclusion.

A bonus is that you're required to start taking RMDs in the year after the year in which you turn age 70. If you take a charitable rollover, you can meet this obligation without paying the usual tax on an IRA distribution.

This tax law provision also applies to Roth IRAs, though it may not be advisable to take this approach with a Roth. Roth IRA distributions to account holders over age 59 are usually tax-free, and it doesn't make sense to use money that isn't taxed to make a donation that isn't deductible. But a portion of a distribution may be taxable if your Roth hasn't been in existence for at least five years. In that case, it might be reasonable to transfer the taxable amount directly to a charity.


The above referenced information was obtained from reliable sources, however Lantern Investments, Inc. and Lantern Wealth Advisors, LLC cannot guarantee its accuracy. Opinions expressed herein are subject to change. Past performance is no guarantee of future results. Asset allocation and diversification do not assure a profit or protect against losses in declining markets. Any information given on the site is informational and illustrative but does not recommend actions as the information may not be appropriate to all situations. It is important that you consider your tolerance for risk and investment goals when making investment decisions. Investing in securities does involve risk and the potential of losing money. Links to other sites are provided for your convenience. Lantern Wealth Advisors, LLC and Lantern Investments, Inc. do not endorse, verify or attest to the accuracy of the content of the web sites that are linked and accept no responsibility for their use or content. Lantern Wealth Advisors, LLC and Lantern Investments, Inc. do not provide tax, accounting or legal advice.