Sunday, October 11, 2009

Randy Gardner, Gardner Financial Planning, Inc.; Professor, Tax and Financial Planning, University of Missouri, Kansas City

Hi. I’m Randy Gardner, Professor of Tax and Financial Planning at the University of Missouri – Kansas City, contributing columnist, with Leslie Daff, for The Journal of Financial Planning, author and editor of several books at the on-site bookstore, and President of Gardner Financial Planning, Inc. My firm performs tax and estate planning services for financial planners and their clients across the country.

The #1 thing advisors should be aware of during the next year is evolving government policy, with its opportunities and threats.

I have been advising clients over 30 years and have not seen a more proactive executive branch than in the past 8 years. Proactivity has its pluses but also its minuses.

Recently, government policy has created windfalls for our clients with 15% (and maybe 0%) dividend and capital gain rates, $250,000 immediate expensing allowances for business purchases, $8,000 refundable credits for home purchases, and “Cash for Clunkers” programs and deductible sales taxes for vehicle purchases. Act quickly though; these government giveaways do not last long.

The executive branch’s need for revenue to accomplish its goals is apparent to all, but less apparent are the heavy handed tactics the executive branch is using to increase revenue. IRS audit rates are climbing; offers in compromise are denied more frequently than ever; and, if the executive branch does not get its way with Congress or the courts, it legislates through the issuance of Regulations, not only a bad precedent, but a violation of the Constitution.

The government is about to respond to some of the critical issues facing the country – the health insurance crisis with its implications for Medicare and Medicaid, the “lack of” retirement savings crisis and Social Security, and the estate tax. What form will these responses take, and at what expense?

As a financial planner, I feel my role is evolving to that of a watchdog for my client’s resources. Some days, I am reading tax updates looking for coupons my clients can cash in. However, on most days, I am keeping the government away from my clients’ doors with solid compliance and well-executed strategies.

You can contact me through UMKC.

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