BusINess February 2015

MARCH 2015

PERSONAL FINANCE ISSUE • • • •

Taxes, Costs and Benefits ACA Business Impact Q&A with WILL GLAROS Get Coverage or Pay the Price

SAVING AND INVESTMENT

• Paying for College • Retirement Someday

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Contents 6 8

COVER STORY

BIZ WORTHY SALUTE

BY THE NUMBERS

COLUMNS

12

35

COLLABORATION Matt Saltanovitz, Director of Economic Development, Northwest Indiana Forum

38

DIGITAL SECURITY Ron Bush, Consultant RonBushConsulting.com

39

TAX TECHNOLOGY Megan Marrs Marrs Media Group

How has the Affordable Care Act impacted small businesses, entrepreneurs?

Q&A with NWI benefits specialist Will Glaros. By Giles Bruce

FEATURES

17

Never too late for 529: College savings plans that pay in advance

28

What's your number?

Good reasons to catch up on retirement savings

31

It’s complicated: Figuring out your tax bill for 2014 is more difficult than ever

2 | IN BUSINESS

21

Paying for college: Good reasons to catch up on retirement savings

29

Taxing medical decision: Get coverage or pay the price

33

Tax planning: Financial experts say 2015 is a key year.

23 Saving for retirement: Choosing the right financial instruments

The Porter Regional Hospital Health At Work program provides a full suite of job-related medical services, including access to Service Coordinators 24/7. Our goals are to help prevent and reduce workplace illnesses and injuries, to avoid lost-time accidents, and lower your healthcare-related expenditures. At Porter Regional Hospital, we know a healthy workforce contributes to a healthy bottom line. To learn why more employers are choosing Porter Regional Hospital’s Health At Work program, or to schedule a consult, call 219-263-7200.

• Workers’ injury treatment and management • Pre-employment screenings • DOT exams • Drug and breath alcohol testing • Respiratory clearance exams

• Audiometric and vision testing • On-site screenings • 24/7 access to injury treatment • Preventive health and wellness services

HEALTHIER EMPLOYEES CAN MEAN A HEALTHIER BOTTOM LINE.

Portage Clinic Now Open Portage Hospital 3630 Willowcreek Road, Portage

Valparaiso Clinic

809 LaPorte Avenue, Valparaiso

Occupational cupa Health and Corporate Wellness

Porter Regional Hospital is directly or indirectly owned by a partnership that proudly includes physician owners, including certain members of the hospital’s medical staff.

Publisher’s Notes MARCH 2015

As ACA comes online , focus moves to ramifications for businesses

T

BY CHRISTOPHER T. WHITE Publisher, BusINess, The Times Media Co.

We want to hear from you Email pat.colander @nwi.com or write to BusINess Magazine, The Times, 601 W. 45th Ave., Munster, IN 46321

4 | IN BUSINESS

he dawn of the new year with tax season approaching is the perfect time to take stock of a major transition that has been coming for years. The law, unofficially known as Obamacare, has already had a seismic effect on the healthcare and insurance industries. In this issue, the coverage goes deeper on what the fuller implementation of ACA means for small businesses, ancillary professions, taxpayers, investors and those paying for education — have we missed anyone? Yes, this is a big and encompassing tent.

Taking the lead on the editorial side, Times Healthcare Business Reporter Giles Bruce zeroes in with an introduction and interview with Will Glaros, the Northwest Indiana business leader who has become a regional expert on the subject of the healthcare law and taxes. The law has had a lasting impact on the way businesses manage benefits, but also on businesses that support any and every aspect of financial reporting and tax-related issues.

When it comes to education, taxes have a credit component.

The American Opportunity refundable tax credit can provide up to $2,500 for those with eligible college expenses. The money is available to students and their parents with income of up to $80,000 per year or combined incomes of up to $160,000 for those filing joint. The Lifetime Learning Credit is similar and provides another source of support for those who are unemployed or under-employed seeking to train for skilled jobs in the modern workplace.

Then there are state-sponsored 529 college savings plans, which impact investments that grow while taxes are deferred.

Grandparents love these instruments. In some cases a portion of those contributed funds can be deducted on state taxes. (Indiana has built a national model with its education savings plan.) We include a look at similar prepaid college plans run by schools.

Also in this issue, we discuss checks, balances and fairness with regard to taxation. There are penalties for those who do not have health insurance that will kick in this year. While many people have insurance through work, Medicaid or Medicare, others must either buy individual health insurance on the open market or pay tax penalties. And those penalties will go up in coming years.

Everyone acknowledges U.S. tax code needs simplification but common ground on what that means is another matter. Credits and deductions are at the heart of the controversy we examine here.

Finally, companies with more than 100 employees are required to provide employee health insurance this year or be subject to big tax penalties. Next year their number will expand to include those companies with 50-100 employees. And even though companies are not required to provide insurance, those with fewer than 50 employees are carefully weighing all the pros (tax credits) and cons (cost) of providing employee health insurance under the Affordable Care Act. Some small to medium-size companies are starting to self-insure to save on costs. Again, this is a complex issue that touches everyone.

While we cannot predict precise outcomes, costs or savings for 2015, we have a solid basis of important information in this edition of the magazine. We know this is only the beginning of a continuing conversation.

VOLUME 11, ISSUE 1

Publisher Christopher T. White General Manager and Vice President, Sales and Marketing Deb Anselm Editor Bob Heisse BusINess Editor Keith Benman Associate Publisher/Editor Pat Colander Design Director Ben Cunningham Designer Sylvia Masuda Contributing writers Giles Bruce, Christine Bryant, Andrea Holechek, Megan Marrs, Jennifer Pallay, Joseph S. Pete, Diane Poulton, Matt Saltanovitz Lead Photographer Tony V. Martin Director of Audience Development Kim Bowers Director of Digital Advertising Joe Battistoni Advertising Managers Craig Chism, Eric Horon Advertising Publication Manager Lisa Tavoletti Business Advisory Board David Bochnowski, Peoples Bank; Wil Davis, Gary Jet Center; Nick Meyer, NIPSCO; Barb Greene, Franciscan Alliance; Tom Gryzbek, Franciscan Alliance; Susan Zlajic, ArcelorMittal Copyright, Northwest Indiana/Chicagoland BusINess, 2015. All rights reserved. Reproduction or use of editorial or graphic content without permission is prohibited.

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BizWorthy SALUTE

Unity Hospice of Northwest Indiana, based in Merrillville, recently honored Director of Clinical Services April Donald, RN BSN, of Hobart, as the 2014 shining star of the year (employee of the year). Donald has served as director of clinical services at Unity Hospice for three years, where her responsibilities consist of managing clinical field staff and overseeing the delivery of hospice care. Donald was selected from among 11 staff members to receive this honor.

HealthLinc Inc. announces that Dr. Catherine Nelson, D.O. is joining HealthLinc’s East Chicago clinic. Nelson is a board-certified family medicine physician and comes from Columbia-St. Mary’s Hospital in Milwaukee. Nelson is a Crete native and graduate of Valparaiso University.

Her medical degree is from Midwestern University: Chicago NELSON College of Osteopathic Medicine in Downers Grove.

Shawn Spaw and Melanie Yagelski are

recognized as the top listing sales associates with Coldwell Banker Porter County.

Spaw is a broker associate and team leader of the Shawn

6 | IN BUSINESS

SPAW

Spaw Team. The team specializes in online marketing and uses the most advanced platforms and marketing strategies to serve clients. Yagelski is a broker associate and lifelong Porter County resident. She is also recognized as the top selling sales associate for December.

Dawn Bernhardt is recognized as the top volume sales associate for December at Coldwell Banker. She is a broker associate who is consistently a top producer.

BERNHARDT Indiana University Northwest has appointed Margaret Skurka ,

MS, RHIA, CCS, as Chancellor’s Professor, a special SKURKA academic title conferred on senior faculty members who demonstrate “highly meritorious performance in all areas of faculty work: teaching, research or creative activity, and service.” Skurka is a professor of health information management and chair of the Department of Health Information Management within the College of Health and Human Services.

Dean Niepokoj is

YAGELSKI

the new vice president/ branch manager of Ruoff Home Mortgage

NIEPOKOJ

Association’s new Crown Point office, 216 E. Joliet St. Niepokoj most recently was assistant vice president at Fifth Third Bank.

This is Ruoff’s 13th office in Indiana and 15th overall.

John Wohadlo

retires as president/ CEO of Advance Financial Federal Credit Union. He was at the WOHADLO helm for 14 years and will continue as a member of the board of directors. Advance Financial has offices in Gary, Schererville and East Chicago.

Dan Wilburn , of R.B. Smith Co., recently attended the Business Leaders Forum 2014 in San Diego, one of two exclusive invitation-only regional events hosted by LPL Financial. LPL Financial is an independent broker-dealer.

Kelly Shikany has joined Lakeside Wealth Management as a financial adviser. Shikany has 20 years experience as a financial adviser in Michigan City and will help Lakeside increase its presence in LaPorte County.

Kari Mayer, district lighting manager for WESCO Distribution Inc. in Hammond, has successfully completed the National Council of Qualifications for the Lighting Professions — Lighting Certification Examination. The certification sets a baseline standard covering the entire scope of the lighting and illumination fields.

Porter Health Care System welcomes Pravin Gupta, M.D. to the hospital’s network, Porter Physician Group. Gupta will be seeing patients at Steel Family Health Care Center, at 2022 Kelle Drive in Chesterton.

Gupta is board certified by the

American Board of Internal Medicine and received his undergraduate and graduate degree from the GUPTA University of Delhi in New Delhi, India. He completed an internship at Lok Nayak Jai Prakash Hospital in New Delhi, India, and a three-year residency in internal medicine at Grant Hospital in Chicago.

Judy Rooney-Davis, with Stolpe Real Estate in Valparaiso, has been awarded the Seniors Real Estate Specialist designation by the Seniors ROONEY-DAVIS Real Estate Specialist Council of the National Association of Realtors. RooneyDavis joins more than 16,000 real estate professionals in North America who have earned this designation. All were required to successfully complete a comprehensive course in understanding the needs, considerations and goals of real estate buyers and sellers 55 and older.

Times Correspondent Lu Ann Franklin will receive the Friend of the Jewish Community Award from The Jewish Federation of Northwest Indiana during the group’s annual FRANKLIN meeting.

Barry Levin, president of The Jewish Federation, said Franklin will be honored for her “constant devotion in helping report on our community’s activities and programs.”

The Chicago Southland Convention and Visitors Bureau announces Juston Teach as its new Communications Manager.

Merrillville civil rights attorney, Trent A. McCain, was one of 25 lawyers to be selected to the Indiana State Bar Association’s Leadership Development Academy starting next month.

The LDA is a statewide leadership program established to empower and develop lawyers to fill significant leadership roles in bar associations, local communities and organizations.

The 25 members will participate in five sessions featuring professional facilitators and prominent speakers to inform participants about leadership principles and techniques.

Sally A. Ramirez has joined Methodist Hospitals as director of compensation and benefits. She previously served as corporate director of compensaRAMIREZ tion and benefits at Majestic Star Casino.

She holds a bachelor’s degree from Purdue University and is a member of KRAFT the Society of Human Resources Management.

Jonathan Kraft, of Valparaiso, was elected president of the Indiana Auctioneers

Association for 2015 at the association’s annual convention in Indianapolis. Indiana has the largest state auctioneers association in the United States. Kraft, 28, will be the youngest member of the IAA to serve as president.

Rieth-Riley announces Gene Yarkie has been promoted to the position of vice president of operations, assuming oversight and direction of all operations in Rieth-Riley’s markets. Yarkie has served as sales manager, area manager, group manager and regional vice president of Northern Indiana.

Adrian Johnson is the new regional vice president of Northern Indiana at Rieth-Riley.

Johnson has over 16 years of experience in the highway industry, with an extensive background in construction management, estimating, materials, plant production, and business development.

Investment adviser Marino Stath , of Stath Financial Services Inc. in Merrillville, recently attend the Greico Academy for Wall Street, a comprehensive, professional training program conducted at the New York Stock STATH Exchange for select independent financial advisers.

Stath was one of only 12 selected to attend the highly CONRAD specialized training in the first week of August.

On Nov. 7, attorneys Monica Conrad and Elizabeth Lucas Barnes, of

Church, Church, Hittle & BARNES Antrim, presented at the Indiana School Boards Association’s fall conference in Carmel, Ind., on “Current Issues in Special Education.” Conrad and Barnes spoke at this one-day seminar for superintendents, general and special education administrators, school board members and school attorneys.

Heather Ennis, Northwest Indiana Forum President and CEO, announced that Matt Saltanovitz will be the new director of Economic Development and Raeann Trakas will be the new director of Marketing & Communications for the regional economic development organization.

Previously, Saltanovitz was the Business Editor at The Times Media Co. SALTANOVITZ in Munster.

Immediately prior to joining the Forum, Trakas was special events director for the city of Hobart.

TRAKAS Methodist Hospitals’ new medical staff officers were announced at the October general medical staff meeting to lead over

600 physicians. They are Raied Abdullah , M.D., nephrologist, president; Abdul Kawamleh , M.D., ABDULLAH cardiologist, presidentelect; Thessa Robertson , M.D., emergency medicine; secretary and Amead Atassi, M.D., KAWAMLEH general surgeon, treasurer.

St. Johnbased Sachs and Hess P.C. attorney Robert M. Hess was

recently selected as ROBERTSON 2015 Lawyer of the Year for Family Law in the northern Indiana region. Only a single lawyer in each practice area and ATASSI designated metropolitan area is honored as the “Lawyer of the Year,” making this accolade particularly significant. These lawyers are selected based on voting averages received during peerreview assessments. Receiving this designation reflects the high level of respect a lawyer has earned among other leading lawyers in the same communities and the same practice areas. Hess also was named a 2015 Best Lawyer in America.

MARCH 2015 | 7

BizWorthy

Ford factory so busy automaker adds parking JOSEPH S. PETE CHICAGO | Five years ago, about 1,200

workers clocked in at the Chicago Assembly Plant in Hegewisch, which was only running a single shift at the time, so it wasn’t too tough to find somewhere to park.

Flash forward to today.

Ford invested $400 million in the 90-year-old factory on the Calumet River so it could start producing a variety of vehicles, including the hot-selling Explorer, which has been America’s top-selling midsize SUV for four straight years. Since, the factory has been bustling and running nearly round the clock with three shifts.

Around 4,000 people now work at the Chicago Assembly Plant, making it one of the region’s largest employers and creating a need for more parking.

Ford just invested more than $3 million in a 380-spot parking lot across the street and a pedestrian bridge that spans Torrence Avenue. It looks similar to the bridge that stretches over 130th Street, leading to the parking lot south of the plant.

“With the demand we’re having, it’s a good thing we’ve been able to have such high employment,” said Tony Reinhart, Ford’s regional government affairs director. “We were able to get this done, to add several hundred parking spaces to get people in and out of the buildings. It’s a positive, a sign of how much is going on at the plant.”

Ford employs around 5,000 people in the area, at the Chicago Stamping Plant in Chicago Heights and at the Hegewisch factory, which is the Dearborn, Mich.based operator’s longest continuously operated factory. Both facilities run three shifts, with 10-hour days and 10-hour nights, Reinhart said. The Chicago Assembly Plant at Torrence Avenue and 130th Street is always cranking out new vehicles, except for a brief period on Saturday night and Sunday morning.

That’s made it hard to find parking close to the factory, and the existing parking lots become difficult to get in and out of during shift changes, Reinhart said.

8 | IN BUSINESS

JOB WATCH

Employment in the Calumet Region Lake County NOV. 2014

NOV. 2013

CHANGE

Labor force

224,861

221,632

+3,229

Employed

207,043

202,738

+4,305

Unemployed

17,818

18,894

-1,076

NOV. 2013

CHANGE

Percent of workforce unemployed 7.9 percent

Porter County NOV. 2014

Labor force

84,678

83,375

+1,303

Employed

79,354

77,704

+1,650

Unemployed

5,324

5,671

-347

NOV. 2014

NOV. 2013

CHANGE

Labor force

49,006

48,876

+130

Employed

45,335

44,766

+569

Unemployed

3,671

4,110

-439

NOV. 2014

NOV. 2013

CHANGE

Labor force

2,603,272

2,608,719

-5,447

Employed

2,445,858

2,379,027

+66,831

157,414

229,692

-72,278

NOV. 2014

NOV. 2013

CHANGE

Labor force

368,087

368,312

-225

Employed

347,669

338,170

+9499

Unemployed

20,418

30,142

-9724

Percent of workforce unemployed 6.3 percent

LaPorte County Percent of workforce unemployed 7.5 percent

Cook County

Unemployed

Percent of workforce unemployed 8.8 percent

Will County Percent of workforce unemployed 5.5 percent

SOURCES: Indiana Department of Workforce Development/Illinois Department of Employment Security

BizWorthy

State health commissioner says HIP 2.0 will improve the well-being of Hoosiers Adams praises governor’s Medicaid expansion GILES BRUCE The new Healthy Indiana Plan approved by the federal government in January will not only improve the health of low-income Hoosiers but help more of them transition into the workforce, the state health commissioner said at a luncheon hosted by the East Chicago Health Department a day after the announcement.

“I could not be more excited about this happening,” Dr. Jerome Adams said at Ameristar Casino after Gov. Mike Pence announced the Obama administration had approved his plan to expand Medicaid under the Affordable Care Act. “I’m convinced it’s going to give people access, it’s going to provide better health care, and it’s going to transition our citizens ... to be able to work and better themselves as opposed to trapping them in an incomebased entitlement program.”

Under the Healthy Indiana Plan 2.0, which builds on the original HIP enacted in 2008, beneficiaries must make a monthly contribution to a health savings account or risk getting kicked out of the program.

The federal government had to give a waiver for the plan because Medicaid traditionally does not require its low-income recipients to share in the costs of their care.

HIP 2.0 is available to all Hoosiers making less than 138 percent of the federal poverty level. Nearly 350,000 Hoosiers who are currently uninsured, including 30,000 in Lake

10 | IN BUSINESS

JIM BIS, THE TIMES

East Chicago Mayor Anthony Copeland, from left, Gary Health Commissioner Roland Walker and Indiana Health Commissioner Jerome Adams talk at a luncheon hosted by the East Chicago Health Department at Ameristar Casino.

County, are eligible for HIP 2.0.

Adams said the plan will improve health outcomes and access for Hoosiers because it rewards beneficiaries for getting preventive care and gives providers higher reimbursement rates than traditional Medicaid.

He also said that because of the added personal responsibility of HIP, its users choose generic drugs at a higher rate than the privately insured and are less likely to use the emergency room than people on traditional Medicaid.

At the same time, he asserted, the health outcomes of HIP patients are the same or better than Medicaid beneficiaries.

Adams was in East Chicago to discuss his department’s top priorities, which include reducing infant mortality,

obesity and smoking, and assuring the state is prepared to fight infectious diseases.

He noted that Indiana ranks 11th in infant mortality, ninth in obesity and 12th in smoking.

Lake County is worse than the state average in all three areas, and also lags behind the rest of the state in low-birth weights, pre-term births, cancer deaths and homicides.

“We have an infant mortality problem in Indiana, but more than that we have a health disparity problem,” Adams said, explaining that getting the infant mortality rate for black Hoosiers in line with that of whites would save the lives of 90 babies a year.

He also said his department is constantly readying itself to fight infectious diseases. He noted that despite all the fear

over Ebola, that virus has caused only two deaths in America while nearly 100 Hoosiers have died from the flu since October (Lake County is tied with the Allen County for the most influenza deaths, at 10 a piece).

“It’s not too late, even now, to get the flu shot,” Adams said.

He also explained how enrolling Hoosiers into HIP 2.0 is one of Indiana’s top publichealth priorities.

“We’re going to bring down our infant mortality rates if we have healthy women before they get pregnant,” he said. “We’re going to bring down our infant mortality rates if everyone’s going to the doctor and learning about how to be healthy and having those conversations about how to have healthy families and healthy children.”

Businesses may have to dump old consumer data Hoosier lawmakers will consider whether to tighten Indiana’s data privacy laws during the 2015 session of the General Assembly.

Republican Attorney General Greg Zoeller and state Sen. Jim Merritt, R-Indianapolis, together are backing legislation mandating companies doing business in Indiana keep only a “reasonable” amount of customer data so as to minimize MERRITT the effects of a potential data breach or hack.

“The key... is making people look through their data and see

PROVIDED BY OFFICE OF INDIANA ATTORNEY GENERAL

Attorney General Greg Zoeller will work with Indiana General Assembly to protect privacy of consumer data in 2015.

whether they’re just collecting it infinitely, or whether they have a current and ongoing need,” Zoeller said. “That’s shifting the paradigm a bit so that companies have to look to protect the

consumer, as opposed to just collecting data.”

Zoeller said the state will not conduct audits of company data practices. Rather, following a data breach, businesses might face

consequences if it was determined they stored excess consumer records electronically or on paper.

Under the plan, companies also would have to more prominently display their privacy policies online.

Merritt, who said he has been the victim of email and bank account hacks, believes the Republican-controlled legislature will support the measure — despite its imposition of new business regulations — because it protects Hoosier consumers.

“All 150 legislators obviously answer to 6.6 million Hoosiers and they are probably getting questions (like) ... What are you doing to protect me against data breaches and my information going places that I don’t want it to go?” Merritt said.

Lawmakers returned to the statehouse Jan. 6 for a four-month session.

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How has the Affordable Care Act impacted

SMALL BUSINESSES AND ENTREPRENEURS?

12 | IN BUSINESS

A Q&A with NWI benefits specialist Will Glaros GILES BRUCE

W

ill Glaros has been helping Northwest Indiana businesses manage their employee benefits for more than three decades.

But he has perhaps never had a greater challenge — or opportunity — than he has right now, assisting companies navigating the

immense changes to health insurance brought on by the Affordable Care Act, the 2010 law often known as Obamacare.

Glaros, partner with the Meyers Glaros Group in Schererville, recently sat down with BusINess Magazine to discuss the myriad ways health reform has impacted small businesses and entrepreneurs.

This interview has been edited and condensed for clarity.

Glaros, partner with the Meyers Glaros Group in Schererville, recently sat down with BusINess Magazine to discuss the how health reform has impacted small businesses and entrepreneurs.

Which individuals and businesses are subject to fines for not having or providing insurance?

From an individual standpoint, other than a limited, excluded group of citizens, everyone is required to have insurance. They actually were in 2014. That continues on in 2015 and into the future. The rationale behind that is we need to get everybody into the system in order to spread the risk, and the driver behind that are the penalties, and they basically increase year by year to force the issue.

For businesses, it’s a little different. Those that are under 50 staff members are still exempt from having to provide insurance coverage for their employees. Groups that are over 50 [employees]but under 100 actually have a one-year exemption, pushed back to 2016.

Those that are over 100 will have to provide coverage in 2015.

It gets a little more complex than that.

I won’t go into the detail, but it’s basically how you count to 100 and it’s not quite as simple as saying, “We only have 50 full-time employees. We don’t have to comply until the following year.” Because if you add in part-time employees with the calculations the government’s developed, you could be well over 100 and have to comply this year.

I would say for the majority of the people, (insurance) costs are going up. There are a limited number of groups we’ve had where the costs have actually gone down. Pricing went from being done on a "partially-experienced" rating to a community rating, where people are basically rated on their geographic location, their age and whether or not they smoke.

Would you say insurance rates are going up both for individuals and businesses? If so, why?

PHOTOGRAPHY: TONY V. MARTIN

I would say for the majority of the people, the costs are going up. There are a limited number of groups we’ve had where the costs have actually gone down.

Pricing went from being done on a partially experienced rating to a community rating, where people are basically rated on their geographic location, their age and whether or not they smoke. So if you have an individual who’s rated previously for a bad health history See GLAROS, Page 14

MARCH 2015 | 13

PHOTOGRAPHY: TONY V. MARTIN

Matt and Will Glaros and Larry and Jeff Meyers are leaders of the Meyers Glaros Group. The business has grown over the past year as they help clients' businesses implement the Affordable Care Act.

14 | IN BUSINESS

CONTINUED FROM PAGE 13

landscape for small businesses and entrepreneurs?

individual insurance market is up to $100 a day, $36,000 a year.

The impact has primarily been The incentive to provide the health insurance tax, which is coverage outside a group plan or a group that’s had a bad health impacting the insurance companies isn’t there, and if you’re going to history, when their recent pricing and passed on to the individual give them money on an individual came into effect or if they moved companies. Then you have what they basis it can’t specifically be for into the individual market, they call the Patient-Centered Outcomes that reason. You’d have to just say may very well have seen a decrease Research Institute fee — that’s we’re going to give everyone an in cost. I’m going to guess about passed onto the company, passed increase, we don’t care what you 15-20 percent of groups and onto the individual in some portion. do with it: buy health insurance, individuals saw reductions. The And then the reinsurance fee. But live higher on the lifestyle basis, majority are seeing increases. primarily those are costs that are it’s up to you. But it did, we think, You asked the reason for those adding to the cost of the coverage. kind of limit the opportunity for increases: One, we’re now covering Originally the concept was the individual to pick up coverage pre-existing conditions, which that companies were going to be with that method. we weren’t covering in the past. able to offer to their people the They’ve extended coverage out for opportunity to go out and buy their Have you experienced children to the age of 26. You’ve own coverage (on the Affordable small businesses going the got preventive health care covered Care Act marketplace), and the route of giving employees at 100 percent with no copays, no company would get rid of their raises and discontinuing coinsurance. There’s no longer any group health care plan, let them their health insurance? medical underwriting, so the risk is get into the individual market and Actually not, surprisingly. The picked up immediately. Clinical trials then they would subsidize them reasons it didn’t take off quite as and experimental care that used for doing that. What the company quickly was because it became to not be covered is now a covered would do is set up a special a taxable event to the individual item in health care. And then there account they would contribute employee. So if an employer are additional penalties and taxes to and a separate account their pays for your health insurance that have been heaped on top of employees would contribute to, every month, $400 a month, that that cost to help fund the uninsured and then when the premiums comes, on a group plan, tax free to who will now be insurable with no would come due, the company the individual. The individual pays pre-existing conditions. would make those payments for their $200 on their own. the individual. Basically the IRS Well, now if the money was How are the tax and penalty shot that down. Now the penalty being paid to that individual — provisions of the Affordable on companies who pay premiums just giving them an income boost, Care Act changing the for their employees to be in the

Glaros

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not telling them how to use it, it’s up to them — that individual is going to lose about 30-plus percent of their spendable dollars because they now have to pay ordinary income tax on it, state tax, federal tax and FICA. It reduces their buying power by doing that.

Who do you think is happier about the Affordable Care Act: entrepreneurs or small businesses?

I would say entrepreneurs, and you’re probably talking to one of them at this very moment.

Everybody truly thought when that bill passed originally in 2010 that the intent was to have us out of business by the year 2020.

In fact, the complexities and the ever-changing landscape, as the government adjusts what everything means, has made our time and our expertise that much more valuable. And we’ve actually grown 30-40 percent in numbers of cases and revenue simply because of the fact that people are looking for people that can help them meander their way through See GLAROS, Page 16 Career Education AC0065

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MARCH 2015 | 15

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PHOTOGRAPHY: TONY V. MARTIN

Glaros

the process. So entrepreneurially it’s been great.

For the individual companies out there, I would say their problems have gotten a little more difficult. Because with the cost increases that happened in 2014, the options were to pay, on average, 10-25 percent more. But if you wanted the opportunity to improve the plan for your employee or to make it less costly and you went to an ACA-platform plan, you could actually end up paying 15-20 percent more on top of that. So it actually probably hurt the majority of the small employers.

How does the small business insurance exchange work, and are many small businesses using that option?

Actually last year it was kind of available, but then they closed it off. Everybody was looking with bated breath this year thinking that was an alternative. I don’t think it’s taken off that quickly. We’ve had a couple of accounts move that way because it made sense financially for them.

One of the drawbacks to the exchange, whether or not it’s on the individual or the group side, is carriers have gone to very limited networks. As an example: I’ve had Blue Cross forever. I ask my doctor, “Are you in the Blue Cross network?' Every doctor, every hospital, says, “Yes.” But when you become part of the exchange, the relationships reduce the numbers of physicians that were willing to sign their financial contract because it comes with deeper discounts.

You may go into a physician who’s been your physician for years who says, “I can’t see you under that card because we’re not part of that network.”

The SHOP (Small Business Health Options Program), I think, is a year away yet, as people get more comfortable with it and as the market stabilizes. But I think people were a little hesitant this year.

Can you think of any unintended consequences the law has had on small businesses?

I think probably the major unintended impact was, and I think this would have been one you think they should have been able to see, is when you put in place a very specific set of benefits — that 16 | IN BUSINESS

everyone has to follow these benefit guidelines — you begin to limit the amount of flexibility an employer has to pay his employees beyond employee benefits alone. He may want to pay his employees more in compensation, but that was just wiped out by this 20 percent increase — or 40 percent increase if they go to an ACA product — and I just think that time needs to settle out where people will get their handle on that and be able to think about using their financial gains to assist their employees in other ways than just offering benefits to them only. I think probably the major loss out there was flexibility by the employer.

You mentioned these ACA plans — will businesses eventually be required to go to the ACA-compliant plans (which come with a minimum set of benefits)?

T h ey w i l l i n 2 0 1 6. W h a t happened was originally everyone was to go in ’14. And that was one of the reasons why the insurance companies over a year ago gave their clients the opportunity to renew early in December of ’13, saying they would be able to defer their involvement with the ACA until December ’14. What ended up

occurring is the president decided to make a determination that groups, if they don’t change their benefits at all, can maintain those plans for one or two more years. So we think we’re good into ’15 and probably into December ’16. And by December ’16 everybody will at that point have to be in an ACA product, assuming the federal government doesn’t change anything again.

And no one knows if that’s possible because of the rapidity with which they’ve been changing things as they’ve moved forward.

Do you think the law will spur more people to become entrepreneurs and start businesses because they don’t have to stay in jobs anymore just for the insurance?

I think there’s definitely an entrepreneurial spirit, but it’s more in solving the needs that have arisen because of the health care changes, on the plans being designed with these higher and higher deductibles. We’re in the process actually right now of inputting into two of our plans video physician visits, where you can go online, pull up a doctor online. He can actually use your iPhone to examine you, looking

down your throat, looking at an injury on your leg, and diagnose you and prescribe drugs for you on that videoconference.

So this takes an individual who can’t afford, with this high deductible, to go to the doctor’s office, even at a discounted rate, and pay $100. He can go to this video camera and pay online with his credit card for $40 an office visit. This plan is actually advertised on ‘Dr. Phil,’ It’s called ‘Doctor on Demand.’ And, as I mentioned, we’re putting it in our second plan as we speak. And it’s a way to give people the opportunity to buy health care. So someone got entrepreneurial with the concept.

Another one was featured in the Times a few months back called ‘My Fast Labs,’ where people can get their laboratory testing done for 60-70 percent under the norm and which enables them to extend their buying power that way.

I think the entrepreneurship has commonly been on how to deal with the health care act. I don’t know that I’ve seen anything yet that freed people up to break away from a company to go out and start their own business. It still is costly to do that.

Why has the Affordable Care Act had such a big impact on your business?

The major reason for that impact on the Meyers Glaros Group is that we’ve always been a benefit-consulting firm, and the majority of our time was spent actually coming up with creative solutions to maintain cost control for the employers. While we still spend the vast majority of our time on that, we’ve had to expand the hours that we invest in our customers and for our customers in advanced reporting systems, updates on legislative changes because with the law have come a myriad of compliance issues that the employers have to comply with.

And with that, the impact has been significant. We have to spend an inordinate amount of time updating our knowledge on a weekly basis and then passing that on to our clients, whether or not it be seminars, webinars, email blasts.

But it has expanded the time that is actually helping them comply, taking away some of our time from the creative portion of it, which I think is where it should be spent more. But we have to deal with the time frames that we have to solve the problems of our clients.

It’s never too late for 529 College savings plans pay in advance

JENNIFER PALLAY Whether your child is still in diapers, about to graduate from high school or currently in college, experts agree it’s never too late to invest in a 529 college savings plan. In general, buyers choose a beneficiary, then put after tax money into an account where it grows tax free and is taken out tax free when used for that beneficiary’s college or graduate school expenses.

Some 529 programs, which vary by state, may also offer tax incentives for in-state contributors.

Contributions to Illinois’ 529 plan, called Bright Start (brightstartsavings.com), are deductible from Illinois state taxable income, up to $10,000 for individuals and $20,000 if married and filing jointly.

Indiana’s program, called the CollegeChoice 529 plan (collegechoicedirect.com), offers a 20% state income tax credit, up to $1,000, each year, for contributions.

Tax breaks are one reason these plans continue to grow in popularity, said Kelly Mitchell, Indiana Treasurer of State. Since Indiana installed its tax credit in 2007, the number of Indiana accounts increased more than 1,300% and assets have increased more than 1,600%.

Low fees, simple online account management and bestin-class savings have also helped the plan’s growth explode.

“The plan is a fantastic program and we consider it to be the best tax incentive program in the nation,” Mitchell said.

The Indiana Education Savings Authority, part of the State Treasurer’s office, reported that they currently have 279,644 total CollegeChoice accounts with 239,677 of them being Hoosier owned.

Any Hoosier tax payer who contributes to a 529 account is eligible, even if the tax payer does not own that particular account.

Terrence Quinn, senior vice president and chief wealth management officer of Peoples Bank in Northwest Indiana, offered more details about how the 529 college savings plans work.

See 529, Page 18

MARCH 2015 | 17

18 | IN BUSINESS

CONTINUED FROM PAGE 17

529

Grandparents and relatives and even friends can help a child save for college and take advantage of the tax credit.

There are $2.9 billion in assets under management, with $2.4 of those dollars being Hoosier owned.

Indiana’s plan, originally called Indiana Family College Savings Plan when it began in 1997, has recently decreased the minimum contribution amount from $25 to $10 in an attempt to make it accessible to all income levels. There is no requirement for how often a contribution must be made.

Encouraging saving for college is always a positive thing, Mitchell said, but people may not know all the benefits.

Students with a college savings account are more likely to graduate from high school because someone encouraged them to think into the future and dream a little bigger, she said.

CollegeChoice assets can be used in or

out of state at most accredited institutions that accept federal financial aid, including technical, vocational and training programs.

The Indiana Education Savings Authority works hard to educate Hoosiers about the program. Mitchell, who has two children in college with 529 accounts, said it’s easy to have good discussions about the program because she has first-hand experience.

“As someone who uses it, I really appreciate the ease of it. I can get online and send payments to the universities my kids are attending.”

Each 529 plan varies with some states running their entire programs in house and others using program managers. In Indiana, the Indiana Education Savings Authority oversees the plan and markets it to Hoosiers but a program manager does the investment management.

Indiana’s CollegeChoice 529 plan is frequently recognized due to its valuable tax credit, said Jodi Golden, of the Indiana

Education Savings Authority.

Forbes magazine recently recognized Indiana’s program for its tax advantages and Morningstar consistently ranks it high on its annual list of “Best 529 College-Savings Plans in the Country.”

Golden said the contribution deadline to be eligible for a tax credit is Dec. 31, meaning funds must be received in check form or electronically initiated by Dec. 31.

Terrence Quinn, senior vice president and chief wealth management officer of Peoples Bank in Northwest Indiana, offered more details about how the 529 college savings plans work.

They are treated similar to an IRA account, he said, where earnings or gains are tax deferred. When the beneficiary goes to college, as long as the money goes toward that purchase, there are no taxes on the account.

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529

If a beneficiary earns a college scholarship and ends up not needing the money, the plan owner can change the beneficiary, perhaps to a sibling, he said.

Owners also have the choice to terminate the plan at any time but similar to an IRA, they will pay taxes on the money.

Quinn said his office sees a lot of parents start 529 accounts but given household costs, it can be hard for parents to maintain contributions.

“The larger amounts we see that get invested in 529 often get invested by grandparents,” he said.

“What’s nice about it is this is a way of saving for college education without having those saving eroded by taxes along the way.”

Quinn has a plan for each of his four grandkids and contributes every year.

“We have them designated for the year they will be graduating from high school.”

An advantage for 529 donors is that they can contribute up to $70,000 in one year and not file a gift tax return.

He used the example of a doctor and his wife with three grandchildren who each 20 | IN BUSINESS

contributed $70,000 per grandchild for the year, making a $420,000 tax free contribution.

“They can’t contribute any more for five years, but they basically paid for their grandchildren’s college educations in advance.”

Like any investment, there is risk with 529s, he said.

“There are no guarantees with stocks or bonds but that’s an advantage to starting early. Even if there is a downturn in the market in a given year, you have time on your side to make it up.”

Another potential disadvantage to these types of plans is limited investment options.

“There are restrictions on how many investment options are available (in each state). In a typical plan, there are only eight or nine,” he said.

“What you don’t want to have happen is a year before they go to college, it’s all invested in stocks and stock market takes a sharp decline and you have a lot less money available.”

Robert Basile, a wealth planner at Fifth Third Private Bank, said people may not know that different 529 college savings plans come with varying risks and potential.

“Do your research and see

which one is best for you given your risk tolerance, ability to fund, and expectation of child going to college.”

In prepaid tuition plans, the buyer does not choose the investment.

“Your BASILE funds go into an investment pool and you have a credit,” Basile said.

“You deposit funds based on

a percentage of current tuition. If you pay one semester of current rate, those funds get deposited into a pool and keep pace with inflation costs.”

The college savings plan option works more like a 401K. “You deposit funds with a number of investment options.

The funds grow to whatever they grow to and when you withdraw them, you use those funds to pay college tuition expenses. You’re dealing with a different level of risk versus the prepaid plan. The state is taking the investment risk on prepaid tuition plan. You’re taking it on college savings plan.”

Paying for College Qualifying for education tax credits and deductions JENNIFER PALLAY

P

arents and college students have a lot of navigating to do when it comes to college expenses and savings opportunities.

Those who pay for college should familiarize themselves with state and federal tax credits as well as potential tax deductions to optimize their savings.

Dale Oliver, a Certified Public Accountant at Laciak Accountancy Group, P.C. with offices in Schererville and Valparaiso, said on OLIVER the state level Indiana residents may qualify for tax credits related to 529 college savings plans.

“The credit is the lesser of 20 percent of the total contributions made to all plans, the taxpayer’s adjusted gross income tax liability or $1,000,” he said.

This is a nonrefundable credit, which means it can only be applied to reduce a taxpayer’s liability to zero. Qualifying contributions must be made by Dec. 31.

Oliver said there are some issues to consider regarding this credit. First, withdrawing funds for any reason other than higher education will result in recapture of previous credits unless it is due to beneficiary death or the beneficiary receiving scholarships sufficient to cover 100% of higher education costs. Second, the credit applies only to specific 529 savings accounts administered through the Indiana Education Savings Authority.

At a federal level, credits available for college expenses include the American Opportunity Credit and Lifetime Learning Credit.

While a taxpayer may claim each of these separately, if there is more than one student eligible, they may be able to take advantage of both credits, Oliver said.

“Both credits have various restrictions and limits, which makes planning for the credit very important.”

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MARCH 2015 | 21

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College

These limits can be based on the definition of an eligible student, phase out limits based on modified adjusted gross income, the person who is actually making the education related payments and types of expenses incurred.

“All the limitations make taking advantage of these credits an extremely complicated process,” Oliver said. He encourages those who may qualify for them to contact a qualified tax

22 | IN BUSINESS

professional who can test various combinations of the credits to maximize tax savings.

The American Opportunity Tax Credit provides a $2,500 per year per eligible student credit off taxes for a tax payer’s whose modified adjusted gross income is less than $90,000 a year as an individual and $180,000 for those filing as married filing joint, according to irs.gov.

This credit applies until the first four years of postsecondary education are complete and covers students pursuing undergraduate degrees or other

recognized education credentials.

Students must be enrolled at least half time for at least one academic period beginning during the year.

The Lifetime Learning Credit, which is worth 20 percent of the first $10,000 of qualified education expenses, is another credit but it can apply to those in undergraduate, graduate and professional degree courses including courses to acquire or improve job skills. Unlike the American Opportunity Tax Credit, this one only requires students be enrolled in at least one course.

There is no limit on the number of years you can claim the credit, the site said. This credit has an annual maximum of $2,000 per taxpayer and is nonrefundable.

This credit applies to qualified tuition and related expenses paid for eligible students enrolled in an eligible educational institution.

The Lifetime Learning Credit also has an income limit.

To claim the full credit, a tax payer’s modified adjusted gross income must be $64,000 or less for an individual and less than $128,000 for married filing jointly, according to irs.gov. After those incomes, there is a reduced amount of credit that phases out.

Those income limits are what causes the most confusion for students and their parents, said Marisa Smoljan, tax manager for McMahon and Associates CPAs in Munster.

“Depending on your income tax, sometimes you might benefit more from a tuition and fees deduction,” Smoljan said.

Tuition and fees deductions offer a $4,000 deduction for people whose

adjusted gross income does not exceed $65,000 for single and $130,000 for married filing joint.

The SMOLJAN qualifying expenses can be found on the 1098T form, which students should receive from their educational institution. She said students should keep track of their book purchases with receipts.

Tuition and fees deductions and the Lifetime Learning Credit are both great for older students returning to school or students just taking one or two classes, she said.

“You’ll find a lot of people are going to back to school to get different degrees or enhancing their educations so taking advantage of those two credits is good,” she said.

She said the IRS recently extended the Opportunity Tax Credit, making it available until 2017. The tuition and fees deductions will continue at least through 2015, unless that also gets an extension, she said.

“It’s nice to see that these benefits will still be around,” Smoljan said. “They change from year to year and we always seem to be in limbo at the end of the year to see whether or not they extend these things so it makes it hard to plan for someone’s tax return.”

Preparation is key when it comes to ensuring educational expenses are handled correctly on tax returns and financial aid forms.

Smoljan said students should do their tax returns as early as possible in order to submit their annual financial aid forms on time.

Robert Basile, a wealth planner with Fifth Third Private Bank, said taxpayers should be sure to include their 1098T form when preparing their tax documents so that their preparer can look for all applicable deductions.

He said students should always fill out the free application for federal student aid, commonly known as a FAFSFA, each year, whether or not they think they will receive benefits.

Visit fafsa.ed.gov/ for more information.

Mike Mulkey at Edward Jones in Munster said if you are thinking about retiring you have to decide what you are going to spend.

Choosing the

right financial instruments

Saving for retirement accelerates

TONY V. MARTIN

DIANE POULTON

R

etirement planning starts with expectations.

“What do you plan to do in retirement and do you expect to spend more or less than you currently spend?”

Mike Mulkey, financial advisor for Edward Jones in Munster explained. “Most people want to maintain their current lifestyle so they need to determine what they are currently spending per year. Prepare a budget based on these expenditures.

Include travel expenditures if that is part of your retirement goal.”

The next step is determining where the income will come from.

“Go online to Social Security to find your income from this source.” According to Mulkey, “If you have any pensions that will pay to you, add that in and any other guaranteed sources of payments to the total. Desired income in retirement minus guaranteed payment sources equals your income shortfall or surplus — if you are lucky.”

Mulkey said the income shortfalls will have to come from all savings sources.

“Using ‘The Rule of 25’ will give you an estimate of the savings you will need to provide you with your income shortfall,” Mulkey said. “Income shortfall times 25 equals required portfolio value. This assumes you wish to keep this nest egg intact. For example, if you’ll initially need $40,000 in pre-tax income from your portfolio, you’ll need a portfolio worth $1 million. This assumes a portfolio of longterm returns over four percent.”

Mulkey said since each individual has a different starting point, ending point and risk tolerance each plan may not be this simple.

See RETIREMENT, Page 24

MARCH 2015 | 23

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Retirement

TONY V. MARTIN

Fifth Third Bank Senior Wealth Planner and Vice President Lisa Shake recommends that employees first take advantage of any company provided 401(k) plans when saving for retirement.

“We, as Americans, are not good savers,” (Lisa) Shake said. “Pensions have gone down drastically in the last 30 years. So it is our own responsibility to make sure we are saving for retirement. If you can do something pre-tax today and save yourself dollars and let it grow tax free, I think that is a huge benefit.”

24 | IN BUSINESS

“The three variables to take into consideration are: one, time — how long can you save until retirement; two, money- how much can you save; three, return — how much your investments earn. You control money and time, and your asset allocations will help determine your return potential.”

Once it is determined how much an individual needs the next step is how to save. Most financial planners recommend using tax-advantaged savings plans such as the 401(k), which is a tax-deferred account.

As an incentive, some employers provide matching funds. According to the Internal Revenue website contributions are limited to a maximum pre-tax annual amount of $18,000. Those over age 50 can contribute an additional catch-up amount of $6,000 annually. Other employer-provided definedcontribution plans include 403(b) plans, for nonprofit institutions, and 457(b) plans for governmental employers. According to the Internal Revenue Service, 401(a) plans may provide total annual additions of $52,000 per plan participant, including both employee and employer contributions.

Individual Retirement Accounts, or IRAs, are tax-deferred retirement accounts through which money can be set aside each year until withdrawals begin at age 59 ½ or later with no penalties. IRAs can be established at a savings institutions, mutual fund or brokerage firms. Only those who do not participate in a pension plan at work or who participate and meet certain income guidelines can make deductible contributions to an IRA. Contributions are taxable when withdrawn. IRA contribution limits for under age 50 are $5,500 and $6.500 after age 50.

Simplified Employee Pension accounts, known as SEP IRAs, are employerestablished retirement savings plans.

Contributions to a SEP IRA are typically 100 percent tax deductible and earnings grow tax deferred. Sole proprietorships, partnerships, LLCs and S corporations are also eligible for SEP IRAs. The IRS limits annual contributions to each employee’s SEP-IRA to not exceed the lesser of 25 percent of compensation, or $52,000 for 2014 and $53,000 for 2015.

A Roth IRA is a modified individual retirement account for setting aside after-tax income. Earnings on the account are tax free as are withdrawals made after age 59 ½. Current IRS limits on Roth IRA contributions are $5,500 for those under age 50 and $6500 for those over age 50.

Fifth Third Bank Senior Wealth Planner and Vice President Lisa Shake said the bank’s savings plans cover the gamut of retirement savings accounts including Roth IRAs, traditional IRAs, self-employment

IRAs, individual 401(k)s and for companies who offer 401(k)s to their employees an institutional group that will help administer that plan.

When saving for retirement, Shake recommends that employees first take advantage of any company provided 401(k) plans.

“Then if your income allows it, I would supplement it with a traditional or Roth IRA,”

Shake said. “If I worked for myself I would either consider a self-employment plan IRA or an individual 401(k).

“Basically if you do not work for a corporation that offers a plan for you, you can still have plenty of options,” Shake said.

Which option to choose is a matter of personal preference, Shake said.

“We, as Americans, are not good savers,” Shake said.

“Pensions have gone down drastically in the last 30 years.

So it is our own responsibility to make sure we are saving for retirement. If you can do something pre-tax today and save yourself dollars and let it grow tax free I think that is a huge benefit.”

Shake said Fifth Third Bank has advisors to help clients decide on their best retirement account options.

“If you have somebody coming

in who is worth anything over a million dollars in net worth, we would ask them to speak to a private bank wealth management advisor,” Shake said. “If your average Joe is walking in off the street we have investment executives in all the branches who will speak to them about the different account types and the pros and cons of each.”

See RETIREMENT, Page 26

MARCH 2015 | 25

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Retirement

Shake said her best advice for retirement is “to save early and save often.

“The benefit of starting a saving strategy from a retirement perspective is that starting early is expediential with interest compounding,” Shake said. “With an average eight percent rate of return, which is somewhat aggressive, if you put $1000 away

26 | IN BUSINESS

at the age of 25 it will grow to approximately $20,000 by the time you are age 65. If you wait and do it at age 35 it would grow to about $10,000.”

Shake said Fifth Third Bank uses a holistic approach to helping clients.

“If a client comes in and says they are going to open an IRA, we will probably ask them more about it and look at the IRA to make sure it is the right IRA for them,” Shake said.

Peoples Bank Senior Vice

President Terry Quinn, who heads the Wealth Management Group, said for employers the bank offers 401(k) and Profit Sharing Plans. For individuals they have traditional IRAs, Roth IRAs, Simple IRAs, and SEP IRAs. “The advantages or disadvantages depend upon the particular circumstances of the participants and how the plan will be funded,” Quinn said.

“We strongly encourage individuals to participate in their

employer’s retirement plan. If at all possible contribute enough to maximize any matching funds offered by your employer.

After that, we then recommend that they participate to the fullest extent possible in their employer’s plan. If they still have funds they want to set aside for retirement, they can then contribute after-tax dollars into an IRA. If after all of that, they still wish to invest further into a tax-advantaged account, their next choices would be annuities.”

What’s your

NUMB3R? It’s never too late to catch up on retirement savings

DIANE POULTON As retirement approaches many workers realize their savings may fall short of the income they need generated to maintain a comfortable lifestyle during their golden years.

Edward Jones Financial Advisor Mike Mulkey said most people are behind when it comes to saving for retirement for a variety of reasons.

“These reasons include the great recession, job loss or change, health care costs, paying for education and many other unexpected See SAVINGS, Page 28

MARCH 2015 | 27

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Savings

events,” Mulkey said.

Financial experts say now is the time to change spending and saving habits in order to catch up. The Federal government allows workers over age 50 increased pre-tax contributions to their retirement accounts.

Experts suggest taking a holistic approach to the matter by reviewing and cutting expenditures to maximize savings contributions.

Local economist Morton Marcus said in order to save more it is important to review expenses to see where cutbacks can be made.

Marcus suggests going through monthly credit card statements and checking account registers.

“What they have to do when they find out they are behind in retirement savings is they have to cut back drastically on their expenditures,” Marcus said. “This can be very very painful. It’s the same philosophy that people use when they exercise so they can live longer. Whenever they exercise they have to take some of the discomfort in order to be in better condition later on. It’s the same way financially.

You have to exercise restraint in your purchases so that you have more money that you can invest.”

At this stage in their lives, Marcus said, people may have to forego the curved television, eat out less, purchase a moderately-priced fuel efficient vehicle, and take lunch to work.

“These are just simple relatively low-cost ways of saving to alter your behavior in such a way that you are spending less so you can save more,” Marcus said. “That is what is necessary to get your money working for you as soon as possible. People will say we have already cut things to the bone. Most people have no idea where the bone is located.”

Marcus said purchases should be thought of in terms of “today, tomorrow and 10 years from now.”

Mulkey advised participating in a companysponsored retirement to the fullest extent possible and adding to IRAs in order to catch up on retirement savings and lower tax bills at the same time.

“If you are maxed out on these options and still have investable income there are bonds that pay federally tax free interest available and tax-deferred annuities,” Mulkey said.

According to the Internal Revenue Service website, although annual 401(k) contributions are limited to a maximum pre-tax amount of $18,000 individuals over age 50 can contribute an additional catch-up amount of $6,000 each year. For Individual Retirement Accounts, known as IRAs, contribution limits for under age 50 are $5,500 and $6.500 for those over 50. The contribution limits for Roth IRAs are $5,500 for those under age 50 and $6,500 for those over 50.

To help decide the best course of action Mulkey suggested talking to both a qualified financial professional and a tax professional.

F. Marc Ruiz, Wealth Advisor and Branch Manager at Oak Partners Inc., recommends a holistic approach to retirement planning for those over age 50.

28 | IN BUSINESS

“Planners have to get these families into a stable budget situation based upon their assets and financial habits,” Ruiz said. “Just as important as catch-up savings is debt reduction and optimization of household expenses. Many times people in their 50s are just finishing paying for college and the household balance sheet tends to be a bit weak.”

Ruiz said the first thing he recommends is to target paying off debt and creating more cash flow.

“After debt is reduced and financial habits are adjusted, we will start them using the catch-up provision of employers’ plans, 401(k) and 403(b), because these plans are payrollbased and easier for the family to adjust to,” Ruiz said. “If the family is able to save more than the maximum allowed in these plans we will target accumulating some non-tax qualified savings and then if the family qualifies from an income

perspective, not too high, we will encourage the Roth IRA as a supplemental savings vehicle.”

Fifth Third Bank Senior Wealth Planner and Vice President Lisa Shake said increasing retirement savings can involve small changes. “lf you get a raise every year put that raise towards retirement savings,” Shake said.

“Because you are already used to living on what you were living on before, it becomes a forced savings for you. One of the big things that I am very much a proponent for is to put yourself before your children in respect to your retirement accounts before you focus on college tuition. As a parent I understand but your children have a longer time period to pay back the loans whereas you have only a limited time to do so. And never ever borrow against your house for college education.”

Shake said although it is better to save early it is never too late to start.

Taxing medical decision Get coverage or pay the price

ANDREA HOLECEK Although a health care professional, Ann Piet never had given much thought to the Affordable Care Act; that is until she retired.

To date, the Affordable Care Act has provided coverage for more than 10 million Americans who previously had no coverage and millions more who were unable to get coverage because of medical conditions or whose coverage was capped.

Piet, 62, had been employed as a school nurse. With an R.N., B.A. and an advanced degree, she has worked in the health care industry for more than 40 years, and always understood the importance of having good health insurance.

But Piet never considered how Obamacare and its requirements could affect her and her spouse.

Under the Act, Americans without health insurance face penalties beginning in the 2014 tax year. Those without coverage will pay a tax penalty of $95 per adult, $285 for a family, or 1 percent of income, whichever is greater. The penalty doubles for this tax year and grows an additional 25 percent by 2016.

When she retired, Piet wasn’t surprised to discover having good health insurance is very expensive.

But she was somewhat shocked by the rigors of finding the best coverage for the best price.

Though the penalties for not having health insurance weren’t a major factor in Piet’s insurance decision, she decided to consider the Obamacare program for other reasons.

Through her job, health insurance coverage for herself and her husband, John, had been part of the benefit package offered according to the contract between her former school district and the teacher’s union.

But Piet needed to learn the eligibility requirements to receive a subsidy through the Affordable

Matt Bapple at Bapple and Bapple in Crown Point said, “A lot of accountants don’t have the answers yet because it’s so new and still being interpreted as we speak.”

TONY V. MARTIN

See INSURANCE, Page 30

MARCH 2015 | 29

CONTINUED FROM PAGE 29

Insurance

Care Act to help pay for coverage, or if coverage through the Act would be cheaper than other options.

“I decided to look into Obamacare,” Piet said. “I think we qualify because it’s a change of life situation, but trying to figure out the coverage options and whether we qualify for a subsidy is so confusing.”

The Piets, who live in unincorporated Cook County, are eligible to receive coverage through her former employers, through the Teacher’s Union’s COBRA plan or through the Illinois Teacher Retirement system.

They have decided on the latter with the cost to her of $213.15 a month, and an additional $853.59 a month for John, who is 62 years old and self-employed.

Cobra would have cost $1,300 a month, while keeping her current plan would add another $450 to their premium.

It took Piet untold hours to get quotes and answers.

“All the websites lead to Obamacare,” she said. “It’s hard to find insurance not associated with it and then it was harder to find out if we would qualify for a subsidy associated with it.”

The Piets think they are on the cusp of the income qualification for a subsidy, but don’t know yet.

“We really won’t know our income for 2015 until year’s end,” Piet said. “It depends on John’s business, if I work part-time, and a lot of other things.”

Those who were covered in 2014 through Obamacare and got a tax credit, must complete a new government form to verify they received the right amount of financial assistance.

If they underestimated their income, they may owe the government money. If it was overestimated, the reverse is true.

“For sure, we don’t want to pay a penalty,” Piet said.

Matt Bapple, owner of the Crown Point–based CPA firm of Bapple & Bapple Inc., agreed there is a lot of confusion about the Affordable Care Act, including coverage, subsidies and penalties.

“It’s been a subject for everyone in the (tax) industry,” Bapple said. “A lot of accountants don’t have the answers yet because it’s so new and still being interpreted as we speak.

Interpreting the law is a real challenge. It’s like trying to put a puzzle together with three parts missing.”

Bapple’s son, David, is a member of the 30-year-old family firm. His father gave him his first mission: to learn everything he could about Obamacare and how it affects the business’s clients. “Now we have an expert in this office, our clients can call on, and they do,” Matt Bapple said .”We did research for every one of them on how it affects them this year and how it will affect them next year.”

Federal tax forms for 2014 include a box, which taxpayers can check to indicate they

30 | IN BUSINESS

had health insurance coverage for that year.

The U.S. Department of Health and Human Services estimates 75 percent of taxpayers will be in that category.

Those who did not carry health insurance for more than three months in 2014 have to file for an exemption or pay the penalty.

Information on the subject can be found at irs.gov/aca or healthcare.gov/taxes.

Alison Flores, principal tax research analyst for H & R Block, also said her company, the largest tax preparer business in the nation, has found that people are not as informed as they should be about the law, its requirements and its penalties.

“People who aren’t covered (by health insurance) don’t know how much the penalty is or how it would affect them,” Flores said.

“As the penalty increases people will need to have a better understanding of the penalty when they make the decision to be covered.”

People can get a policy through the ACA’s marketplace, pay the full price upfront and if they have overestimated their income, they can get a refund, she said.

“If they have underestimated their income, they will need to repay the funds, Flores said.

“If you give them honest information and it’s wrong, there isn’t a penalty, but you may end up owing it.”

Because there are so many changes in the law for the 2014 and 2015 years, Flores said she would encourage everyone to seek help from a tax professional to understand how they are affected.

H & R Block provides a calculator on its website, hrblock/aca-tax-impact, where users can learn if they could face a penalty, qualify for an exemption, or may be eligible for the Advance Premium Tax Credit to help with the cost of health insurance, said company spokeswoman Annelise Wiens.

TONY V. MARTIN

Karen and Bill Wiater of Crete use a tax preparer to make sure that their returns are in compliance with the ever-changing federal tax regulations.

Figuring out your tax bill for 2014 is more difficult than ever ANDREA HOLECEK

Most Americans — about 60 percent — use some type of assistance when preparing their taxes, said Annelise Wiens, ike millions of a spokeswoman for H & R Americans, Karen and Bill Wiater annually pay Block, the nation’s largest tax preparation service. a specialist to prepare In fact, the company’s tax their income tax forms.

“It’s too complicated,” said Bill preparers, each with an average Wiater, a senior citizen who lives of eight years in the industry, in Crete. “I’ve had someone doing must take 15 hours of continuing education and 35 hours of tax mine for years and years.” education annually to keep up Who can blame him? with changes and additions to the The federal income tax code tax code. is more than 4 million words A report by Bank of America/ covering 9,000 plus pages. From Merrill Lynch said that while the 2001-2012 alone, there were complexity of the tax code may 4,600 changes, more than one continue to be discussed as a per day. major failing, few people anymore “Yes,” Bill Wiater said, “We’d expect taxpayers, or even most probably do our own taxes if it tax experts, to have a full grasp of was easier and simpler.”

L

the entire code.

“And as for simplifying the code Dave (Rep. Dave Camp, the chairman of the House committee on Ways and Means) Camp’s tax reform bill was 979 pages long,” the report said.

The last major revision of the Internal Revenue Code was in 1986.

However a report in Forbes magazine contends that the public seems unconcerned with the need to fix the tax code as a poll shows that tax reform did not make the list of the most important national problems.

David Bochnowski, chairman and CEO of Munster-based People’s Bankcorp Inc., said he would like to know “why tax forms are now so complex that

you need a professional to do them.”

“Even Turbo Tax is a form of professional help,” Bochnowski said. “It’s very hard to understand and follow it’s complexities.”

Any reform of the tax code must have “fairness and simplicity,” he said.

“We don’t have either right now,” he said. “Everyone knows the issues but no one knows how to resolve them. The current tax code is for another time. We have to look at the alternatives. What are the give ups, but what are the returns.”

The tax code is supposed to and does influence behavior, he said. Therefore, jettisoning See TAXES, Page 32

MARCH 2015 | 31

CONTINUED FROM PAGE 31

Taxes

deductions can have unintended consequences. For example, eliminating the real estate tax deduction may make it less likely people would purchase homes, Bochnowski explained.

“Simplification is good,” said Jim Thomas, an accounting professor at Indiana University Northwest. “But that’s probably not going to happen.”

There are many, many ideas on how to make the tax code simpler, but no one agrees on how to do it, Thomas said.

“There are many problems with it and many general approaches, but they all have trade-offs,” Thomas said.

Some feel the government should lower taxes to stimulate the economy, while others feel the government should only use tax increases as a last resort when the economy is faltering, he said.

“Those two groups in Congress are typically at odds on how to do either,” Thomas said.

Middle-class Americans want to keep the deduction the tax code allows, such as the interest on home mortgages, real estate taxes, and charitable contributions and would fight any attempts to remove them or any elected officials who espoused those removals, Thomas said.

A “flat tax” where everyone pays relatively the same rate has been touted.

“It sounds great,” Thomas said. “Now rates vary from 0 to 39.6 percent, With a flat tax everyone would pay in the low 20 percent range.”

But again using a flat tax would remove the deductions prized by the average American.

Plus, with a flat tax corporations wouldn’t be able to take deductions for the benefits they offer employees, such as health insurance, sick pay, vacations, making the flat tax more repugnant to the average taxpayer, according to Thomas.

There have been proposals to impose higher tax rates on the wealthy, “but people always say that takes away the money they would spend on new business investment. I think everyone agrees there’s a lot of simplification needed,” he said. “It will happen some way, but the country still has a great debt so it still has to charge taxes.”

Another approach is to limit individual and corporate deductions, he explained.

“But Congress put many deductions into the tax codes to help their contributors and neither group would want them removed.”

“Many corporations have lawyers on staff who help write the tax code and have lobbyists to see that the proposals are put into place.”

The 2014 Bank of American/Merrill Lynch report also said that one of the reasons the tax code hasn’t been simplified is that tax calculations have become automated.

“In some sense, tax reformers can be said to have been TurboTaxed,” the report says.

32 | IN BUSINESS

JOHN J. WATKINS

Chairman and CEO of Peoples Bank, David Bochnowski thinks that the tax code should not have to be as complex as it is.

“That is, the declining cost of computing software and hardware make it unnecessary to know most of what the tax code is doing…

The lack of a hue and cry among taxpayers for tax reform may be partially the result of this automation of the code. One can get a copy of TurboTax online for $27.”

President Barack Obama has offered a detailed set of tax loophole closers and measures to broaden the tax base. Observers however, doubt his proposal can win the support of the U.S. House and Senate which Republicans holding the majority in Congress.

The President proposals include “cutting tax preferences for high-income households; eliminating special tax breaks for oil and gas companies; closing the carried interest loophole for investment fund managers;

and eliminating benefits for those who buy corporate jets.”

A recent White House statement says tax reform should draw on those items, together with the elimination of additional inefficient tax breaks, to finance the reduction of marginal rates and meet the President’s other tax principles, including the Buffett Rule. The rule says, “No household making more than $1 million annually should pay a smaller share of their total income in taxes than middle-class families.”

“In the absence of fundamental tax reform, the President believes these measures should be enacted on a stand-alone basis, along with permanent extension of the middle class 2001 and 2003 tax cuts,” the White House report concludes.

Financial experts say 2015 is a key tax planning year DIANE POULTON

A

s taxpayers prepare to tackle their 1040 forms, local financial advisors and tax experts say tax planning is an important

Linda Bourrell, owner of A+ Tax and Accounting Service, said now is the perfect time for taxpayers to review their W-4 worksheet to calculate withholding amounts with a tax professional.

TONY V. MARTIN

first step.

F. Marc Ruiz, Wealth Advisor and Branch Manager for Oak Partners Inc., said 2015 is a key year for tax planning.

“Starting in 2015 the individual mandate begins to get serious for the ACA (Affordable Care Act) at two percent of income or up to $975 (penalty) per family,” Ruiz said. “If you had qualifying health insurance in 2015 your insurance carrier or employer plan will issue Form 1095. If you didn’t, you’ll need to use Form 8965 to calculate your penalty.”

Ruiz said ACA premium subsidies are also available in 2015 to taxpayers with incomes up to four times the federal poverty level, which for a family of four is $95,400. That is where tax planning comes into play.

“The subsidies can be considerable for early retirees using assets for income,” Ruiz said. “It’s a good idea to explore ways to shelter income and maybe reduce income needs in order to receive a subsidy.

It’s also important to make sure the IRS stays up to date on your family size as the subsidy guidelines are based upon the number of members in your family.”

Ruiz said another consideration this year is that the IRS has tightened up its rules regarding indirect 60-day IRA rollovers.

“The old rule allowed taxpayers to remove funds from an IRA as long as the funds were re-deposited within 60 days,” Ruiz said.

“Taxpayers were using multiple IRAs to do multiple indirect rollovers each year, essentially getting access to IRA funds without tax. The new rules allow only one indirect rollover per year See PLANNING, Page 34

MARCH 2015 | 33

CONTINUED FROM PAGE 33

Planning

per taxpayer, essentially closing this oft-abused loophole.”

Now is a good time, Ruiz said, for small business owners to set up a SIMPLE IRA plan.

“A SIMPLE IRA is an employer-sponsored plan which allows business owners to defer taxes on up to $12,500 of income,” Ruiz said.

“SIMPLE IRAs are easy to administer but must be set up before October 1 of this year to be effective for the 2015 tax year.”

Another important change which affects tax planning, Ruiz said, is the extension of the charitable IRA withdrawal for taxpayers over 70-and-a-half.

“This rule enables taxpayers over the age 70-and-a-half that are required to withdraw money from their IRA to have these required distributions paid directly to a charity,” Ruiz said.

“If the withdrawal is paid directly from the custodian to the charity the withdrawal amount does not impact the taxation of other income sources and the amount donated to charity is also fully tax deductible.”

The IRS is also allowing annual rollover of Flexible Savings Account (FSA) balances up to $500, Ruiz said. Previous rules required balances in FSAs be used or lost each calendar year.

“This new rule will make it easier to plan for healthcare expenses,” Ruiz said.

Ruiz said Indiana offers attractive tax benefits of a 20 percent state tax credit of up to $1,000 for those contributing to the Indiana 529 college savings plan.

“Credits are great tax benefits because they reduce your actual tax bill dollar for dollar,” Ruiz said.

“Contributions have to be made

by December 31, 2015 to receive the credit.”

Linda Bourrell, owner of A+ Tax and Accounting Service, said now is the perfect time for taxpayers to review their w4 worksheet to calculate withholding amounts with a tax professional.

“The reason being the worksheet does not take all factors into account when figuring how many exemptions to take,” Bourrell said. “Each year you should discuss your desired range of where you want your tax results 34 | IN BUSINESS

Timothy Rigsby, CPA, who is the Managing Principal for Laszlo Rigsby Financial Services, agrees that taxpayers should use professional services both to claim their maximum tax deductions and to avoid costly mistakes.

TONY V. MARTIN

to be as well as changes that will affect your tax return.”

Bourrell said changes for 2014 taxes include increases in the standard deductions and exemptions as well as newly-required forms relating to insurance.

Bourrell said her most important piece of advice to clients in regards to tax planning is to “invest in yourself.” Bourrell said this includes contributing the maximum percentage to your 401(k) or, at the very least, matching the employer’s’ maximum contribution. If there is no 401(k) available Bourrell recommends creating an IRA if your income is high now because it reduces the amount of taxable income.

“Presumably less income during retirement equals lower tax brackets,” Bourrell said.

If income is already taxed at a lower rate, Bourrell recommends a Roth IRA. “These contributions are deposited with after tax dollars

and all money earned inside the Roth IRA is tax free after five years,” Bourrell said.

Because tax laws change each year, Bourrell advises against preparing tax returns without the help of a professional.

“At home tax programs, such as TurboTax, can walk you through entering information on the documents but if you do not know or understand the tax laws there are situations that these programs can not address,” Bourrell said. “Recent changes to IRS’s preparer requirements require that anyone who charges a fee to prepare tax returns must register with the IRS for a pin number. The IRS has a voluntary continuing education program through which preparers who participate can be listed on the IRS web page as a Registered Tax Preparer.”

Timothy Rigsby, CPA, who is the Managing Principal for Laszlo Rigsby Financial Services, agrees with Ruiz and Bourrell that taxpayers should use professional

services both to claim their maximum tax deductions and to avoid costly mistakes.

“The United States tax code is over 75,000 pages long,” Rigsby said. “Stacked page by page, the tax code alone is approximately 12 feet tall. The tax code reads like no other document and is full of ifs and buts that are cancelled out by false positive sentences that then cancel out the last three pages of reading you just read.”

Rigsby said the tax code is constantly changing and mistakes can be extremely costly with interest and penalties adding up to more than the amount of tax owed.

“The tax code is complex and it’s very easy to misinterpret or imply meaning out of context,” Rigsby said. “A professional is more likely to save them money by finding deductions a client has no knowledge of, which in turn, reduces their tax burden.

Quite often the taxpayer’s benefits exceed the expense of professional services.”

LaPorte Mayor Blair Milo addresses the TEDx event at County Line Orchard.

JOHN J. WATKINS

Ideas worth spreading in Northwest Indiana

BY MATTHEW SALTANOVITZ

NWI Forum Economic Development Director Matt Saltanovitz is proud to be a part of a new catalyst: TEDx CountyLine Road, Northwest Indiana’s first TEDx conference, which took place Nov. 13 at County Line Orchard in Hobart.

D

o you have the courage to change the world? What about our home — Northwest Indiana? Can we gather momentum to plan smart and dream big for our region’s future?

For far too long, Northwest Indiana citizens and leaders have only concerned themselves with their own backyard. As we are now starting to work in tandem, the kinetic energy is intensifying. And a group I am proud to be a part of established a new catalyst: TEDx CountyLine Road, Northwest Indiana’s first TEDx conference which took place Nov. 13 at County Line Orchard in Hobart.

Speakers for the sold-out event included LaPorte Mayor Blair Milo, Faith Church senior pastor Bob Bouwer,

prominent economist Brian Wesbury and Excellence by Design owner Norma Williams. For those who were unable to attend this epic event, videos of their talks will be posted on the TEDx CountyLineRoad website at www.

TEDxcountylineroad.com.

The speakers inspired and provoked ways of thinking differently. Wesbury challenged the conventional tale of the events that led to the Great Recession.

He cautioned against buying into the commonly understood history of even recent events.

Williams shared her stirring story of starting her own painting company after See TEDX, Page 36

MARCH 2015 | 35

JOHN J. WATKINS, THE TIMES

Pastor Bob Bouwer talks at the TEDx event at County Line Orchard.

CONTINUED FROM PAGE 35

TEDx finding herself as a single mother with no discernable training or education. She uses her now-successful business to provide opportunities for young women who have found themselves in similar spots. “Passion is the fire that fuels our hearts. … Will you inspire change, incorporate the gifts you have and be ready to help?” she asked the audience.

Pastor Bouwer dared the TEDx audience to take what’s alive and unique in them or their business and reproduce it. “What is Northwest Indiana’s ‘wow,’ and what can it do to reproduce it?”

Bouwer asked.

Mayor Milo offered a Disney theme while tying in many of the day’s topics, and shared her passion for the region. “We’d like to create the happiest place on earth based on reality,” she said. “… How can we do that in Northwest Indiana?”

Milo’s bold message is rooted in her resolve, but also her levity. Milo proclaims LaPorte as “The Hub of Awesome.” I couldn’t agree more.

36 | IN BUSINESS

Our volunteer group of young professionals, community leaders and stakeholders from Lake and Porter counties spent six months of hard work to organize TEDx CountyLineRoad and move the needle forward in Northwest Indiana. Many of us have worked to extend the West Lake Corridor of the South Shore rail line. Many others are engaged leaders who want to be part of the solution locally. After organizing a South Shore rally, we collectively wondered what we could do next to effect change in our home.

Luckily for us, established leaders encouraged us to think big.

Northwest Indiana is more than Chicago’s little brother. We can become a global force of change, innovation and reinvention.

Once our group established the possibility of TED coming to a local venue, we knew we were on to something.

For those unfamiliar, TED is a global set of conferences where experts share “Ideas Worth Spreading.” The TEDx Program is designed to help communities, organizations and individuals to spark conversation and connection through local TED-like experiences

in their local communities. At TEDx events, a combination of live presenters and TED Talks videos sparks deep conversation and connections at the local level.

Our group was purposeful when we selected County Line Orchard for the venue. Much of our intent in bringing TEDx to our home is to bridge the gaps that divide us — including the literal and figurative gap between Lake and Porter counties – to inspire an indomitable movement in Northwest Indiana toward positive change.

Initially we were concerned the message wouldn’t reach enough people. Has TED resonated in the Calumet Region? Our fears subsided in the time it would take you to spell “TED.” TEDx rules require those organizing their first TEDx event to cap the audience at 100. We reached 65 before ticket sales were announced publicly.

Unfortunately, that meant we had to turn away some people who wanted to experience the first TED event in Northwest Indiana.

Fortunately, the inaugural TEDx CountyLineRoad was successful, and our future events no longer are limited to 100 attendees.

Our group couldn’t have

brought TEDx to the Calumet Region without some assistance.

In addition to his guidance as the show date drew near, emcee and South Shore Arts Executive Director John Cain deftly held the show together and kept the positive energy flowing in his alwaysgregarious manner.

Our generous sponsors, including The Times Media Co., Lake Area United Way, United Way of Porter County, NIPSCO, Burke Constanza & Carberry LLP and Task Force Tips, were instrumental in developing TEDx CountyLineRoad with their support. And the South Shore Convention and Visitors Authority was eager to offer space at the Indiana Welcome Center for our rehearsal.

I urge everyone to join what will be an annual experience and a continuous effort. Visit www.

TEDxcountylineroad.com for more information about the inaugural event, as well as future updates about the next TEDx CountyLineRoad.

What is your passion? What is your “wow”? Join the cause to make Northwest Indiana the happiest place on earth.

info@mcmahonpc.com www.mcmahonpc.com

10010 Calumet Avenue • Munster, IN 46321 Phone: 219.924.3450 • Fax: 219.924.1640

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Digital Security

Practicing good and simple cyber security

I

BY RON BUSH

Ron Bush consults with businesses to help them write company’s Information Security Policies and Procedures and train their employees in safe practices. He can be reached at RonBushConsulting.com.

38 | IN BUSINESS

t seems appropriate in a special issue on money and taxes that we devote some thought to cybersecurity. “What’s the connection?” may be your first question.

If so, think about it again. Do you leave your wallet or purse accessible to anyone outside of your presence? For instance, if I walked by your desk at work would I find your debit card taped to the wall next to your computer or in your unlocked right hand drawer? “Of course not!” you might respond. Well, for most people reading this article, that is exactly where I might find your password to get into your system at work.

If you keep most of your money in the bank, safely locked away from criminals who might steal it, and you keep some money with you at all times in your wallet or purse, you already know that you cannot leave money lying around without accepting the possibility that someone with less scruples than you have might take it.

Those who study criminology know that opportunity is half of the equation when thieves decide to strike.

So why would anyone leave his or her password available to another person who might decide to look for it? If we could walk into most offices in this country and could go desk-to-desk unobserved, say like a burglar might, we would find most passwords to company computers entrusted to employees pinned or taped to the wall nearby or in the top center, left or right hand drawer.

If there is a pad or calendar on top of the desk, then the passwords are probably under it.

If you work for someone or you own the business, remember that 81 percent of all breaches happen to small to medium-sized businesses (SMBs). If you depend upon your job for your livelihood — and most of us fall into that category — 60 percent of SMBs who have been breached close their doors within six months. It is in your own best interest, whether you own the company or not, to be sure the doors stay open and a simple way to help accomplish that is to keep your password safe from unwanted intruders. Memorizing the password is the best solution.

But what about your computer at home? Are your passwords readily available there? If a burglar enters your home office would he or she easily obtain access to your bank and credit card accounts online? Today’s technology affords us a great deal of freedom and convenience, but

that can quickly and easily become a liability and totally disrupt your privacy and jeopardize your financial life.

Ask anyone who has endured having his or her identity stolen.

So, what can you do? First, create strong passwords.

Use a combination of upper and lower case letters, numbers and special characters. Don’t spell any words.

Make it as random as possible. Make it at least sixteen characters.

“What?!? Sixteen characters? Why?” Because the longer your password is and the more random (less predictable) it is, the longer it will take a password cracking program to break it. There is an abundance of free software on the Internet that is used for “password recovery.”

That is the term used for recovering a lost or forgotten password. Most of us have been through that hassle.

But as with many things, the tool that can be used for helping you get back to work on your computer can also be used by a hacker to break into your system to steal your company’s data or your own personal information.

In the wrong hands, your personal data can be extremely lucrative. That information can give an identity thief potential income for months or years to come.

A cyber thief can use your information to set up loans, credit cards, run up those accounts you already have, and sell your information to other identity thieves who will do the same thing.

Don’t be a victim! Protect yourself! That begins with creating strong passwords and keeping them secure from others.

Finally, since we’re discussing taxes in this issue, remember that the two most popular scams identity thieves use are posing as FBI agents or professionals working for the IRS. Why? Because those two categories of government workers scare the daylights out of most of us so we tend to automatically do what the agent impersonator says.

If you didn’t generate the call or the online conversation, then you have no idea who you are talking with. Never, and I mean never say anything online or over the phone that you are not willing to broadcast across the whole world.

Technology

Help is a touch screen away when preparing to file taxes for 2014

I

BY MEGAN MARRS

Megan Marrs is owner of Marrs Media Group, a branding and strategic marketing company and Associate Director, Social Media at University of Chicago Booth School of Business. Megan is a graduate of Purdue University (’06) and Valparaiso University M.B.A. (’11).

t’s that time of the year again — tax season. As a small business owner you might face the question, “Can I do this myself? How much will this cost?” Or better yet, “When am I going to find time to file my taxes?”

While tax professionals provide expertise, there are multiple options to choose from if you want to file your taxes yourself. Take a look at three of the most popular software packages for small business owners: TURBOTAX TurboTax is an excellent solution if you are looking for a one-stop-shop option. TurboTax enables you to easily identify which expenses are tax-deductible. The software also assists with finding many tax write-offs that are often missed.

There is a wide range of additional tax features available with TurboTax, including to track your audit risk, check errors prior to filing, along with guidance and support for asset depreciation as well as industryspecific tax deductions. Using this software is quick and easy. Simply: • Import your previous year’s tax return to save time • Automatically import your profit and loss statements from QuickBooks. TurboTax classifies income and expense accounts into the appropriate editable tax categories. (if you do not use QuickBooks, don’t worry, they still have you covered) TurboTax’s interface is very user-friendly, so you should not have trouble navigating your way through the different categories. However, the program includes access to experts if you have any questions. This software for small businesses is $149.99 with federal e-file included. State filing add-ins cost an additional $49.

TAXACT TaxACT Small Business is a great option for small business owners looking for a straight-forward Q&A-based tax preparation experience. TaxACT uses interview questions mixed with a broad-range list of expenses that’s used to gather information. You can try TaxACT Small Business software for free on the Web or by download; however, filing costs vary.

Simply: • Identify which type of business software is best for you • Import previous year’s tax information • Answer tax-wizard questionnaire After following a few quick steps, TaxACT then automatically populates your data into the correct categories while taking into account all possible deductions. Pricing for this software ranges from zero

As a small business owner you might face the question, “Can I do this myself? How much will this cost?” Or better yet, “When am I going to find time to file my taxes?”

While tax professionals provide expertise, there are multiple options to choose from if you want to file your taxes yourself. to $69.98, which does not include the additional fees for state and federal filings. Pricing does include phone support, reconciliation of income, TaxTutor guidance and price lock guarantee.

H&R BLOCK- IPAD APP File your taxes from the convenience of your couch, favorite coffee shop, or office. H&R Block offers a fullyfeatured tax filing app. You can easily swap between your tablet and desktop to pick up where you left off with this clever design for devices. The app offers a review process that ensures there are not any issues with your filing.

The main difference between using the app as compared to using software on your desktop is that you have the convenience to work on your taxes as your busy schedule allows. Simply: • Import previous year’s tax information • Answer step-by-step Q&A • Sit back and wait for your maximum refund With H&R Block’s mobile app, it’s free to file your federal return, and $9.99 for state filings. H&R Block also offers a 5% bonus back on federal filings, and free in-person audit support, along with maximum refund guarantee.

As you can see, there are many tax helpers that offer similar features and benefits, with cost as the varying factor. I encourage you to explore which option suits your business and lifestyle best, before you begin to prepare and file your taxes with ease this season.

MARCH 2015 | 39

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DODGE

BUICK CIRCLE bUICk 2440 45th Street, Highland, IN IN. 219-865-4400 • IL. 773-221-8124 www.circleautomotive.com

CHEVROLET ARNELL ChEVROLET U.S 20 & I-94, Burns Harbor, IN 866-593-0997 www.arnellmotors.com ChRISTENSON ChEVROLET 9700 Indianapolis Blvd., Highland, IN 888-999-9141 www.christensonchevy.com SMITh ChEVROLET - hAMMONd 6405 Indianapolis Blvd., Hammond, IN 219-845-4000 www.smithautogroupusa.com SMITh ChEVROLET - LOwELL 700 W. Commerical, Lowell, IN 219-696-8931 www.smithautogroupusa.com

gRIEgERS dOdgE 1756 U.S. 30 West, Valparaiso, IN 219-462-4117 www.griegersmotors.com

FORD

HONDA

NISSAN

TEAM hONdA 4613 East Rt. 30 Merrillville, IN 219-947-3900 www.teamhondaon30.com

SOUThLAkE NISSAN rt. 30, 1 mile E. of I-65, merrillville, IN 888-471-1241 www.southlakeautomall.com

HYUNDAI wEbb hyUNdAI 9236 Indianapolis Blvd., Highland, IN 219-923-2277 www.webbhyundai.com

JEEP gRIEgERS JEEP 1756 U.S. 30 West, Valparaiso, IN 219-462-4117 www.griegersmotors.com

LAkEShORE FORd 244 Melton Rd. (US 20@I94, Exit 22A) Burns Harbor, IN 219-787-8600 www.lakeshoreford.com

KIA ARNELL kIA I-94 AutoMall, Hwy. 20 & I-94 Burns Harbor, IN 219-787-9200 www.arnellmotors.com

SMITh FORd 1777 E. Commercial, Lowell, IN 219-769-1090 www.smithautogroupusa.com

RAM gRIEgERS RAM 1756 U.S. 30 West Valparaiso, IN 219-462-4117 www.griegersmotors.com

SUBARU NIELSEN SUbARU 5020 u.S. highway 6, Portage, IN 888-503-4110 www.nielsen.subaru.com

TOYOTA LAkEShORE TOyOTA 244 Melton Rd. (US 20@I94, Exit 22A) Burns Harbor, IN 219-787-8600

SOUThLAkE kIA rt. 30, 1 mi. East of I-65 merrillville, IN 888-478-7178 www.southlakeautomall.com

wEbb FORd 9809 Indianapolis Blvd., Highland, IN 800-533-1279 www.webbford.com

GMC

MITSUBISHI

CIRCLE gMC 2440 45th Street, Highland, IN IN 219-865-4400 • IL 773-221-8124 www.circleautomotive.com

NIELSEN MITSUbIShI 5020 u.S. highway 6, Portage, IN 888-503-4110 www.nielsenmitsubishi.com

SOUTH HOLLAND

www.lakeshoretoyota.com TEAM TOyOTA 9601 Indianapolis Blvd., Highland, IN 219-924-8100 www.teamtoyotaon41.com TOyOTA ON 30 4450 E. RT 30, Merrillville, IN 219-947-3325 www.toyotaon30.com

CoNtACt Your tImES’ mEDIA CoNSuLtANt to fEAturE Your buSINESS IN thE tImES Auto DIrECtorY

ORLAND PARK

PORTAGE

VALPARAISO

MERRILLVILLE

CROWN POINT

CROWN POINT • (219) 662-5300 MUNSTER • (219) 933-3200 VALPARAISO • (219) 462-5151