Retirement Legislation May Have Significant Impact

On August 17, President Bush signed the most extensive revision of the nation's pension law in three decades. The “Pension Protection Act of 2006” is a huge tax bill that overhauls the funding and disclosure rules for pension plans and changes the rules for conversions of pension plans to cash balance plans. The legislation also makes permanent increases to IRA contribution limits that would otherwise have expired after 2010.

This legislation comes at the heels of The Tax Increase Prevention and Reconciliation Act of 2005 which President Bush signed into law on May 17th. Starting in 2010, the existing $100,000 income test for converting a traditional IRA to a Roth IRA will no longer apply. Conversions that occur in 2010 will be taxed in over two years – half in 2011 and the other half in 2012. In anticipation of this opportunity we are recommending individuals strongly consider maximizing their traditional IRA contributions.

If you have questions about how these changes impact your personal situation please give me a call.

Christopher John Colgan Hits the Big One

Christopher just celebrated his 1st birthday on August 21st. And on his birthday he took his first steps – all the way across the family room! He is a great baby and lots of fun. Here is my most recent picture of him at the Sunflower field on Clover Road.