Charlene G Moffatt, PC

10/07/2026

📋 A retiree's Medicare bill can jump in a year when nothing about their health changed, because of a tax return filed two years earlier.

Medicare's income surcharge, IRMAA, looks at your modified adjusted gross income from two tax years back, so your 2024 return sets your 2026 premiums.

For 2026, going over $109,000 single or $218,000 joint by even one dollar triggers the first surcharge, and it applies to both Part B and Part D.

Most of what shows up on the front page of a tax return counts: wages, pensions, traditional IRA and 401(k) withdrawals, capital gains, and the taxable part of Social Security.

Two items catch people off guard. Municipal bond interest is free of federal income tax, yet IRMAA adds it back. And a Roth conversion counts in full in the year you convert.

The other column is where the planning room is. Qualified Roth withdrawals, HSA money spent on medical costs, and loan proceeds, including a reverse mortgage, don't count.

If you're 70½ or older, a qualified charitable distribution can send up to $111,000 from an IRA straight to charity in 2026 without counting, and it can also satisfy a required minimum distribution.

Home sales split in two: gain inside the $250,000 single or $500,000 joint exclusion stays out, and gain above it counts.

The two-year lag is what to plan around. A large conversion this year lands on the bill two years from now, so deciding to convert is also deciding what you'll pay for Medicare later.

If your income drops because you retire, cut back work, lose a spouse, or divorce, Form SSA-44 lets you ask Social Security to use a more recent, lower year instead.

Which item on this list surprised you most?

P.S. Once a week, I email the best money article I read, with my take on this week's top Facebook posts and what's new on the Ways to Wealth blog. It's free, and you can sign up on the Ways to Wealth home page.

R.J. Weiss, CFP®



The content shared here is for educational and informational purposes only. It is not personalized investment, tax, legal, or financial advice. Consult a licensed professional before making decisions based on your specific situation.

10/06/2026

Here in Texas both spouses get the step up. When selling the primary residence you can use the spousal exclusion of $500,000 if sold within 24 months. After 24 months it reverts to $250,000.

🏡 Two surviving spouses each sell a vacation home they owned with their late spouse. Both homes cost $200,000 decades ago, and both sell for $600,000 soon after the death. One survivor owes tax on $200,000 of gain. The other owes nothing. The difference is state property law.

When someone dies, most of what they leave behind gets a "step-up," meaning its tax basis resets to its value at death and the gain built up before then stops counting. It works in reverse too: property that lost value steps down.

For married couples, state law decides how much gets reset. In the nine community property states, Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin, property that counts as community property gets a step-up on both halves when the first spouse dies.

Everywhere else, property a couple owns jointly usually gets a step-up only on the half that belonged to the spouse who died. The survivor's half keeps its original basis. In the example, that leaves a $400,000 basis instead of $600,000, and $200,000 of taxable gain on the sale.

Five states, Alaska, Florida, Kentucky, South Dakota, and Tennessee, let couples opt into community property by placing assets in a special trust, and Alaska also allows a written agreement. Some of these states let couples from elsewhere use them. The trade-offs can include weaker protection from one spouse's creditors, and the IRS has never formally confirmed that these trusts get the step-up on both halves.

Two things this rule never changes: IRAs and 401(k)s get no step-up in any state, and separate property doesn't become community property just because you live in one of the nine states. How property is titled matters, so check your deed and account titles before assuming which rule applies to you.

If you've moved between states, community property generally keeps that status after the move. That's worth raising with whoever drafts your estate plan.



P.S. Once a week, I email the best money article I read, with my take on this week's top Facebook posts and what's new on the Ways to Wealth blog. It's free, and you can sign up on the Ways to Wealth home page.

R.J. Weiss, CFP®

The content shared here is for educational and informational purposes only. It is not personalized investment, tax, legal, or financial advice. Consult a licensed professional before making decisions based on your specific situation.

10/05/2026

Which birthday after 50 can cost you money if you ignore it? On this list, only three.

The other nine are permissions. Nothing happens if you let them pass. You've simply gained an option you can use when you're ready.

At 50, the IRS lets you save more: an extra $8,000 in a 401(k) and an extra $1,100 in an IRA for 2026. From 60 through 63, the 401(k) extra climbs to $11,250, then drops back to $8,000 in the year you turn 64.

At 59½, the 10% penalty on retirement account withdrawals goes away. At 62, Social Security becomes available, though claiming then means a check about 30% smaller than at full retirement age for anyone born in 1960 or later.

At 70, the growth stops. Social Security's delayed credits end, so there's no reason to wait past that birthday. At 70½, you can give to charity straight from an IRA.

The three red ages are different. They're deadlines.

If you don't have health coverage from a current job, missing your Medicare sign-up around 65 brings a Part B penalty that lasts as long as you have Part B.

Your first required minimum distribution comes at 73 if you were born from 1951 through 1959, or at 75 if you were born in 1960 or later. Skipping one can cost 25% of the amount you should have taken, or 10% if you correct it within the correction window, generally two years.

One more note on 65: the $6,000 senior deduction applies for 2025 through 2028 and shrinks once income passes $75,000 for single filers or $150,000 for married couples.



P.S. Once a week, I email the best money article I read, with my take on this week's top Facebook posts and what's new on the Ways to Wealth blog. It's free, and you can sign up on the Ways to Wealth home page.

R.J. Weiss, CFP®

The content shared here is for educational and informational purposes only. It is not personalized investment, tax, legal, or financial advice. Consult a licensed professional before making decisions based on your specific situation.

10/04/2026

🙏 If you put money in the offering plate every week but take the standard deduction, those gifts haven't lowered your taxes in years.

That changes with your 2026 return.

A new law lets people who don't itemize deduct cash gifts to charity on top of the standard deduction: up to $1,000 for single filers and $2,000 for married couples filing jointly.

For a couple in the 22% bracket who gives at least $2,000, that's $440 less in federal tax.

The gifts have to be cash, check, or card, and they have to go directly to a qualifying charity, like your church, a food bank, or a hospital foundation. Bags of clothes dropped at a thrift store and gifts to a donor-advised fund don't count toward this deduction.

Keep your records. The usual rules still apply, including a written acknowledgment from the charity for any single gift of $250 or more.

If you itemize, the rules moved the other way. Only the part of your giving above 0.5% of your adjusted gross income is deductible now, so a household with $100,000 of income loses the deduction on its first $500 of gifts.

Itemizers who give steadily may come out ahead by combining two or three years of giving into one year, then taking the standard deduction plus the new $1,000 or $2,000 in the years between.

If you're 70½ or older and have a traditional IRA, giving straight from the IRA to the charity still sidesteps all of this. That gift never counts as income, up to $111,000 a year, and it can count toward your required minimum distribution.



P.S. Once a week, I email the best money article I read, with my take on this week's top Facebook posts and what's new on the Ways to Wealth blog. It's free, and you can sign up on the Ways to Wealth home page.

R.J. Weiss, CFP®

The content shared here is for educational and informational purposes only. It is not personalized investment, tax, legal, or financial advice. Consult a licensed professional before making decisions based on your specific situation.

09/08/2026

A good discussion on gifting.

09/06/2026

Food for thought.

📊 Updated version of one of our most-discussed posts this summer, with the two questions the comments kept asking answered right on the image.

Your Social Security check is based on what you earned, not what you paid in, and it uses your 35 highest years, not your last few and not your best quarter.

If you have fewer than 35 years of covered earnings, the missing years count as $0, and wages above the 2026 cap of $184,500 do not count at all.

Those 35 years are indexed to wage growth through the year you turn 60, then divided by 420 months to get your AIME.

The 2026 formula pays 90% of the first $1,286 of AIME, 32% of the amount from $1,286 to $7,749, and 15% of anything above that.

A worker with $2.5 million in lifetime indexed earnings has an AIME of $5,952, which never reaches the 15% tier and produces $2,650 a month at full retirement age.

Claiming at 62 cuts that to $1,855 for life, while waiting to 70 raises it to $3,286.

Your Medicare Part B premium comes out of that check before it reaches you, so the deposit is smaller than the benefit.

The formula is built to replace a larger share of a low earner's wages than a high earner's, which is the part people either call fair or unfair. Which side are you on?

P.S. Once a week, I email the best money article I read, with my take on this week's top Facebook posts and what's new on the Ways to Wealth blog. It's free, and you can sign up on the Ways to Wealth home page.

R.J. Weiss, CFP®



The content shared here is for educational and informational purposes only. It is not personalized investment, tax, legal, or financial advice. Consult a licensed professional before making decisions based on your specific situation.

09/03/2026

🏥 Updated version of a post from June, with the questions from that thread folded in: whether IRMAA is permanent, whether the income line is before or after the standard deduction, and what to do after you retire or lose a spouse.

Past $109,000 of income for a single filer, or $218,000 for a married couple filing jointly, the 2026 Medicare Part B premium stops being the same for everyone and climbs through six tiers.

The surcharge is called IRMAA, and it runs on modified adjusted gross income, which is your adjusted gross income plus tax-exempt interest, measured before the standard deduction.

At the first tier, the Part B premium rises from $202.90 to $284.10 a month, with a $14.50 Part D surcharge added on top.

IRMAA is a cliff, so one dollar over a bracket raises your premium for all twelve months of the year.

It runs on a two-year lookback, so your 2026 premium comes from the income on your 2024 return, and it is charged per person, so a couple with both spouses enrolled can pay it twice.

It is not permanent: Social Security recalculates it every year from a new return, and if your income dropped because you retired, cut your hours, or lost a spouse, Form SSA-44 asks them to use your current income instead.

A large Roth conversion or capital gain can raise your Medicare cost two years later, which makes the timing of that income worth planning.

Which tier are you closest to, and was it a one-time event or your normal income that put you there?

P.S. Once a week, I email the best money article I read, with my take on this week's top Facebook posts and what's new on the Ways to Wealth blog. It's free, and you can sign up on the Ways to Wealth home page.

R.J. Weiss, CFP®



The content shared here is for educational and informational purposes only. It is not personalized investment, tax, legal, or financial advice. Consult a licensed professional before making decisions based on your specific situation.

08/25/2026

📋 Medicare premiums are set from your tax return two years back, so income at 63 decides your Part B premium at 65.

That single lookback is why the five years before retirement are a tax planning window rather than a savings window.

The bridge account is the one missed most often. Retire with everything inside a 401(k) and every dollar you spend is taxable income, which leaves no room to convert at a low rate.

The years between your last paycheck and your first required distribution are often the lowest bracket you will ever see.

You can still convert after RMDs start. The required amount just comes out first and cannot be converted, so the cheapest conversion years are the ones before that.

None of this requires a large balance. It requires knowing which account each dollar comes from and in which year.

Two limits worth naming: Form SSA-44 can reset an IRMAA surcharge after a life-changing event like retiring, and conversion math depends on your bracket now versus later, which is not the same answer for everyone.

Which of the five is the one you had not thought about?

P.S. Once a week, I email the best money article I read, with my take on this week's top Facebook posts and what's new on the Ways to Wealth blog. It's free, and you can sign up on the Ways to Wealth home page.

R.J. Weiss, CFP®



The content shared here is for educational and informational purposes only. It is not personalized investment, tax, legal, or financial advice. Consult a licensed professional before making decisions based on your specific situation.

08/23/2026

🧱 A couple who are both 65 or older take a $35,500 standard deduction in 2026, and a survivor filing alone takes $18,150.

That is the standard deduction only, and separate from the temporary senior deduction of up to $6,000 per person that some people 65 and older can also claim through 2028.

The drop is not automatic for everyone, because a surviving spouse with a dependent child can generally use qualifying surviving spouse status for two years after the year of death, which holds the joint rates and the larger deduction in place.

The house has its own clock: a surviving spouse can generally use the $500,000 capital gains exclusion only if the sale closes within two years of the death, the other ownership and use tests are met, and there has been no remarriage before the sale.

Sold after that window, the usual individual exclusion of up to $250,000 is what remains.

Nothing forces a sale, and staying put is the right call for plenty of people, but the tax cost of waiting should be a decision rather than a surprise.

Inherited retirement money has a fork worth understanding: rolling the account into your own IRA is the usual move, while keeping it titled as an inherited IRA can preserve penalty-free access for a survivor who is under 59 1/2 and needs to draw on it.

Beneficiary designations generally control retirement accounts, life insurance, and payable on death titles regardless of what the will says, so every one of those forms deserves a review, even if the contingent beneficiary already names the right person.

Medicare is the piece most people miss, because 2026 premiums are set from a 2024 return that still shows joint income, while the surcharge tiers for a single filer start above $109,000 rather than $218,000.

The death of a spouse is a qualifying life-changing event, and Form SSA-44 asks Social Security to recalculate that surcharge using your lower income instead.

Which of these caught you or someone you know off guard?

P.S. Once a week, I email the best money article I read, with my take on this week's top Facebook posts and what's new on the Ways to Wealth blog. It's free, and you can sign up on the Ways to Wealth home page.

R.J. Weiss, CFP®



The content shared here is for educational and informational purposes only. It is not personalized investment, tax, legal, or financial advice. Consult a licensed professional before making decisions based on your specific situation.