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Richard Feldman was quoted in the South Florida Business Journal. To read Susan R. Miller’s article titled “Nonprofits can benefit from IRA donations” please click here.

Frank was interviewed by the Director of Personal Finance at Morningstar at this Years Investment Conference. To see the whole interview click http://bit.ly/bCDsr3

For more, click here http://bit.ly/bRX442

To read more on critical tax issues click http://bit.ly/9Pxzoi

May’s almost 1000 point “Flash Crash” brought back memories of the bad old days. We may never know what spooked the market, but calmer heads prevailed and the world did not end. In fact by the end of the trading session, much of the decline had recovered, none of which kept May from being a dreary month indeed. In fact, it was the worst month in a very long time.

Investors had plenty to think about during the month, and it made them cranky.

But, on the other hand, economic news is generally good, interest rates are low, employment is slowly rising, consumers are more confident, and there are signs that even housing may be stabilizing. The world hasn’t ended and isn’t likely to end soon. Long term investors need to ignore the market’s gyrations and stick to their plans and have faith that over time they will be rewarded for supplying capital to the world’s economy. Otherwise their own behavior is the greatest risk that they face.

Market declines are always disconcerting but part of the investment process. After the huge run up stock market recovery, it would be surprising indeed if the market never “corrected” before going on to new highs.

Investors that missed out on the great buying opportunities of 2007-2008 may have another chance to put some of that $3 Trillion dollars parked in money market funds to work. Eventually, investors will tire of zero returns, re-discover their taste for risk, and a then good portion of those funds will find their way back into the stock market inevitably raising the market. It’s only a question of who will be on board to benefit when it happens.

The mess in Europe opened up the possibility of sovereign defaults, the collapse of the Euro, Massive Bailouts, expulsion of weak countries from the European Union, or withdrawal of strong countries from the EU. None of this bodes well for economic growth in Europe, which will inevitably retard global growth. The resulting decline in the value of the Euro hammered any foreign investment held by US citizens, compounding global investor’s misery.

Of course, we shouldn’t be surprised that Goldman Sachs arranged currency swaps for Greece over the last decade that allowed Athens to raise funds to reduce its budget deficit while pushing payments well into the future. Those transactions were not classified as loans, report the New York Times, and not made known to Brussels officials. That’s just another example of leading edge financial chicanery from Wall Street’s wonder children.

Who needs terrorists when we have BP? The economic and environmental damage of the Gulf Oil Spill may mount higher than from a few well placed atomic weapons. As of today no one has the foggiest notion of how to contain the oil, and there is no end in sight. Americans are again confronting government agencies and regulators that are incompetent, inept, and possibly corrupt. Meanwhile, only the guys that got us into this mess have any resources to correct it. Sound familiar?

As if that’s not enough, the two Koreas edged toward war, the Middle East Peace Process is destroyed, and the UN thinks Iran has enough enhanced uranium to make two bombs.  

With memories of 2007-2008 fresh in their minds, investors headed for the doors. The results were dismal indeed. Every asset class was punished in May, but of course, foreign holdings were impacted adversely by the decline of the Euro. REITS and Commodities suffered right along with their more traditional stock market relatives.

The May results swamped any gains from April, leaving only REITS with a nominal positive return. 

Year to date, the domestic returns are positive, REITS are positive, foreign returns negative, and Commodities negative, leaving the equities portfolio with a small net loss.

April 15^th is rapidly approaching which means most individuals will be finishing their 2009 income tax return over the next week and a half.  Individual retirement accounts are a great way to save for retirement and can also lower your tax bill.  With the Bush tax cuts getting ready to retire and the new tax healthcare tax coming in 2013 retirement accounts are a great way to shelter assets from taxation.  To follow is a breakdown of the eligibility requirements of Individual Retirement Accounts and who is eligible to contribute to them.

Traditional and Roth IRA Account Limits

The aggregate 2009 contribution limit for traditional and Roth IRA contributions is the lesser of $5,000 or earned income.  For individuals more than 50 years of age, an additional $1,000 catch up contribution is allowed.  Traditional IRAs are also known as deductible IRAs because, under certain circumstances, contributions you make can be deducted on your Form 1040.  If an individual does not contribute to a retirement plan at work, the full amount under this type of IRA is deductible.  However, for individuals who participate in an employee sponsored retirement plan (i.e., 401k), the following phaseouts apply:

• If your filing status is Married Filing Jointly, contributions are deductible if your Adjusted Gross Income (AGI) is below $89,000.  Between $89,000 and $109,000, only a partial deduction is allowed.  If it is in excess of $109,000, it is not deductible. 

• For single individuals the range is between $55,000 and $65,000.

• For Married Filing Separate, individuals with AGI above $10,000 are not allowed a deduction for a Traditional IRA contribution.

Unlike Traditional IRA contributions which may be deductible, Roth IRA contributions never are.  However, when the time comes to take distributions from a Roth IRA account, they are done so tax free.  In contrast, to the extent that you received a deduction on your taxes for Traditional IRA contributions, upon drawing from your account, those monies will be taxed at your then ordinary income tax rate.  Whereas you pay current income taxes on Roth contributions, you, in essence, defer taxes on (deductible) Traditional contributions until they are withdrawn.

Roth IRA contributions can be made even when a taxpayer participates in their employer sponsored retirement plan.  However, income limits apply to Roth IRA contributions.  They are as follows:

• For single taxpayers, a full Roth IRA contribution can be made if Adjusted Gross Income (AGI) is below $105,000.  A reduced contribution is allowed for AGI between $105,000 and $120,000.  For individuals with AGI in excess of $120,000, Roth contributions are disallowed.

• If your filing status is Married Filing Jointly, contributions to a Roth IRA are allowable if your Adjusted Gross Income (AGI) is below $166,000.  Between $166,000 and $176,000, only a partial deduction is allowed.  If it is in excess of $176,000, it is not allowed. 

Spousal IRA

A great “loophole” with regard to IRA contributions is that of the spousal contribution.  Typically, IRA contributions are limited to $5,000 (for 2009) plus $1,000 catch up provision if you are over 50 years old or earned income.  For spouses not employed outside of the home with no earned income to speak of, the IRS allows them to piggyback on their working spouses earned income.  This allows both spouses to contribute to their own IRAs and help save/contribute to their retirement nest egg. The spouses must file jointly to take advantage of the spousal contribution.   

There are income limitations on spousal IRA contribution limits if your spouse is a participant in a corporate retirement plan.  The phase-out range for 2009 is $166,000 – $177,000.  If you file married-separate, your phase out range is $0-$10,000.

Contribution Deadline

Contributions made to traditional, Roth, and Spousal IRAs must be postmarked by April 15^th in order to be deducted from your 2009 taxes.  Filing an extension does not extend the time period for IRA contributions to be made to your account.

Workers are finally catching on to and resisting high fee 401(k) plans. And, the courts, SEC and DOL are siding with them. Plan sponsors that continue to turn a blind eye on the outrageous, imprudent and unwarranted fees that their participants pay do so at their peril. Read “Earlier Retirement: Beating Back the High Fees” in the Wall Street Journal, by clicking here.

Frank was quoted in Fox Business’ “When to Borrow From Your 401K”. To read the article, click here.

WalletPop’s Lan Nguyen chats with Frank on what people in their 20s and 30s need to do to save for retirement. To listen, please click here.

Frank was quoted on CBS’ Money Watch on “What to Do with Your 401(k) Now. To read the full article, click here.