Atlantic Capital Management,Inc.William C. Newell, CFP®President and Senior Financial Advisor851 Washington St.Holliston, MA 01746Ph (508) 893-0872Fax (508) 893-8087bnewell@acminc.org

March 2020Is It Time to Review Your IRA Estate PlanningStrategies?

Spring Cleaning Your Way to Better Finances

Is there any way to stop getting unwantedrobocalls?

How can I avoid becoming a victim of a socialengineering scam?

Due Date Approaches for 2019 Federal Income Tax Returns

See disclaimer on final page

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Tax filing season ishere again. If youhaven't done soalready, you'll wantto start pulling thingstogether — thatincludes getting yourhands on a copy ofyour 2018 tax returnand gathering W-2s,1099s, and

deduction records. You'll need these recordswhether you're preparing your own return orpaying someone else to prepare your tax returnfor you.

Don't procrastinateThe filing deadline for individuals is generallyWednesday, April 15, 2020.

Filing for an extensionIf you don't think you're going to be able to fileyour federal income tax return by the due date,you can file for and obtain an extension usingIRS Form 4868, Application for AutomaticExtension of Time to File U.S. IndividualIncome Tax Return. Filing this extension givesyou an additional six months (to October 15,2020) to file your federal income tax return. Youcan also file for an extension electronically —instructions on how to do so can be found in theForm 4868 instructions.

Filing for an automatic extension does notprovide any additional time to pay your tax.When you file for an extension, you have toestimate the amount of tax you will owe andpay this amount by the April filing due date. Ifyou don't pay the amount you've estimated, youmay owe interest and penalties. In fact, if theIRS believes that your estimate was notreasonable, it may void your extension.

Note: Special rules apply if you're living outsidethe country or serving in the military and onduty outside the United States. In thesecircumstances, you are generally allowed anautomatic two-month extension (to June 15,2020) without filing Form 4868, though interestwill be owed on any taxes due that are paidafter the April filing due date. If you served in acombat zone or qualified hazardous duty area,you may be eligible for a longer extension oftime to file.

What if you owe?One of the biggest mistakes you can make isnot filing your return because you owe money.If your return shows a balance due, file and paythe amount due in full by the due date ifpossible. If there's no way that you can paywhat you owe, file the return and pay as muchas you can afford. You'll owe interest andpossibly penalties on the unpaid tax, but you'lllimit the penalties assessed by filing your returnon time, and you may be able to work with theIRS to pay the remaining balance (options caninclude paying the unpaid balance ininstallments).

Expecting a refund?The IRS is stepping up efforts to combatidentity theft and tax refund fraud. New, moreaggressive filters that are intended to curtailfraudulent refunds may inadvertently delaysome legitimate refund requests. In fact, theIRS is now required to hold refunds on all taxreturns claiming the earned income tax credit orthe additional child tax credit until at leastFebruary 15.

Most filers, though, can expect a refund checkto be issued within 21 days of the IRS receivinga tax return.

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Is It Time to Review Your IRA Estate Planning Strategies?The Setting Every Community Up forRetirement Enhancement (SECURE) Act,which was passed in December 2019 as part ofa larger federal spending package, included aprovision that warrants special attention fromthose who own high-value IRAs. Specifically,the "stretch" IRA provision — which permittednonspouse beneficiaries who inherited IRAs tospread distributions over their lifetimes — hasbeen substantially restricted. IRA owners maywant to revisit their estate planning strategies tohelp prevent their heirs from getting hit withhigher-than-expected tax bills.

The old "stretch" rulesUnder the old rules, a nonspouse beneficiarywho inherited IRA assets was required to beginminimum distributions within a certain timeframe. Annual distributions could be calculatedbased on the beneficiary's life expectancy. Thisability to spread out taxable distributions over alifetime helped minimize the annual tax burdenon the beneficiary. In the past, individuals coulduse this stretch IRA strategy to allow large IRAsto continue benefiting from potentialtax-deferred growth for possibly decades.

Example: Consider the hypothetical case ofMargaret, a single, 52-year-old bankingexecutive who inherited a million-dollar IRAfrom her 85-year-old father. Margaret had tobegin taking required minimum distributions(RMDs) from her father's IRA by December 31of the year following her father's death. Shewas able to base the annual distribution amounton her life expectancy of 32.3 years. Since shedidn't really need the money, she took only theminimum amount required each year, allowingthe account to continue growing. UponMargaret's death at age 70, the remainingassets passed to her 40-year-old son, who thencontinued taking distributions over theremaining 13.3 years of Margaret's lifeexpectancy. The account was able to continuegrowing for many years.

The new rulesAs of January 2020, the rules for inherited IRAschanged dramatically for most nonspousebeneficiaries.1 Now they generally are requiredto liquidate the account within 10 years of theaccount owner's death. This shorter distributionperiod could result in unanticipated andpotentially large tax bills for high-value inheritedIRAs.

Example: Under the new rules, Margaret wouldhave to empty the account, in whateveramounts she chooses, within 10 years. Sinceshe stands to earn her highest-ever salariesduring that time frame, the distributions could

push her into the highest tax bracket at both thefederal and state levels. Because the accountfunds would be depleted after 10 years, theywould not eventually pass to her son, and hertax obligations in the decade leading up to herretirement would be much higher than sheanticipated.

Notable exceptionsThe new rule specifically affects mostnonspouse designated beneficiaries who aremore than 10 years younger than the originalaccount owner. However, key exceptions applyto those who are known as "eligible designatedbeneficiaries" — a spouse or minor child of theaccount owner; those who are not more than 10years younger than the account owner (such asa close-in-age sibling or other relative); anddisabled and chronically ill individuals, asdefined by the IRS. The 10-year distributionrule will also apply once a child beneficiaryreaches the age of majority and when asuccessor beneficiary inherits account fundsfrom an initial eligible designated beneficiary.

A word about trustsIn the past, individuals with high-value IRAshave often used what's known as conduit — or"pass-through" — trusts to manage thedistribution of inherited IRA assets. The trustshelped protect the assets from creditors andhelped ensure that beneficiaries didn't spenddown their inheritances too quickly. However,conduit trusts are now subject to the same10-year liquidation requirements, so the newrules may render null and void some of theoriginal reasons the trusts were established.

What can IRA account owners do?IRA account owners should review theirbeneficiary designations with their financial ortax professional and consider how the newrules may affect inheritances and taxes. Anystrategies that include trusts as beneficiariesshould be considered especially carefully.Other strategies account owners may want toconsider include converting traditional IRAs toRoths; bringing life insurance, charitableremainder trusts, or accumulation trusts into themix; and planning for qualified charitabledistributions.1 For account owners who died prior to December 31,2019, the old rules apply to the initial beneficiary only(i.e., successor beneficiaries will be subject to the10-year rule).

The SECURE Act ushered inchanges that may have adramatic impact on IRAestate planning strategies.Account owners may wantto review their plans withtheir financial professionals.

There are costs andongoing expensesassociated with the creationand maintenance of trusts.

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Spring Cleaning Your Way to Better FinancesSpring is a good time to clean out the cobwebs,and not just in your home or apartment. Yourpersonal finances can benefit from a goodspring cleaning, too. Here are some questionsto ask yourself regarding your budget, debt,and taxes.

Is there room in my budget to savemore?A budget is the centerpiece of any goodpersonal financial plan. After tallying yourmonthly income and expenses, you hopefullyhave money left over to save. But... is thereroom to save even more? Review your budgetagain with a fine-tooth comb to see if you mightbe able to save an additional $25, $50, $100, or$200 per month. Small amounts can add upover time. If you participate in a workplaceretirement plan, you might not even notice yourslightly smaller paycheck after you increaseyour contribution amount.

If your expenses are running neck and neckwith your income, try to cut back ondiscretionary spending. If that's not enough,look for ways to lower your fixed costs orexplore ways to increase your current income.Budgeting software and/or smartphone appscan help you analyze your spending patternsand track your savings progress.

Do I have a strategy to reduce debt?When it comes to your personal finances,reducing debt should always be a priority.Whether you have debt from student loans,credit cards, auto loans, or a mortgage, have aplan to pay down your debt as quickly aspossible. Here are some tips.

• Credit cards. Keep track of your credit cardbalances and be aware of interest rates andhidden fees; manage your payments so youavoid late fees; pay off high-interest debt first;and avoid charging more than you can pay offat the end of each billing cycle.

• Student loans. Are you a candidate forincome-based repayment? You can learnmore at the Federal Student Aid website.

• Additional payments. Making additionalloan payments above and beyond yourregular loan payments (or the minimumpayment due on credit cards) can reduce thelength of your loan and the total interest paid.Online calculators can help you see theimpact of making additional payments. Forexample, if you're halfway through a 30-year,$250,000 mortgage with a fixed 4.5% interestrate, an additional principal payment of $150a month can shave two years off yourmortgage. An extra $250 a month can shaveoff three years!

• Refinancing. If you currently have consumerloans, such as a mortgage or auto loan, takea look at your interest rate. If you're paying ahigher-than-average interest rate, you maywant to consider refinancing. Refinancing to alower interest rate can result in lower monthlypayments and potentially less interest paidover the loan's term. Keep in mind thatrefinancing often involves its own costs (e.g.,points and closing costs for mortgage loans),and you should factor these into yourcalculation of how much refinancing mightsave you.

• Loan consolidation. Loan consolidationinvolves combining individual loans into onelarger loan, allowing you to make only onemonthly payment instead of many.Consolidating your loans has severaladvantages, including saving you time on billpaying and record keeping and making iteasier for you to visualize paying down yourdebt. In addition, you may be able to get alower interest rate.

• Paying down debt vs. investing. To decidewhether it's smarter to pay down debt orinvest, compare the anticipated rate of returnon your investment with the interest rate youpay on your debt. If you would earn less onyour investment than you would pay ininterest on your debt, then using your extracash to pay off debt may be the smarterchoice. For example, let's say you have$2,000 in an account that earns 1% per year.Meanwhile, you have a credit card balance of$2,000 that incurs annual interest at a rate of17%. Over the course of a year, your savingsaccount earns $20 interest while your creditcard costs you $340 in interest. So paying offyour credit card debt first may be the betterchoice.

Do my taxes need some fine-tuning?Spring also means the end of the tax filingseason. You might ask yourself the followingquestions:

• Am I getting a large tax refund or will I owetaxes? In either case, you may want to adjustthe amount of federal or state income taxwithheld from your paycheck by filing a newForm W-4 with your employer.

• What else can I learn from my tax return?Now is also a good time to assess taxplanning opportunities for the coming year,when you still have many months left toimplement any strategy. You can use lastyear's tax return as a reference point, thenmake any anticipated adjustments to yourincome and deductions for the coming year.

When it comes to yourpersonal finances, reducingdebt should always be apriority.

All investing involves risk,including the possible lossof principal, and there is noguarantee that anyinvestment strategy will besuccessful.

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Atlantic CapitalManagement, Inc.William C. Newell, CFP®President and Senior FinancialAdvisor851 Washington St.Holliston, MA 01746Ph (508) 893-0872Fax (508) 893-8087bnewell@acminc.org

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2020

IMPORTANT DISCLOSURES

Broadridge Investor CommunicationSolutions, Inc. does not provideinvestment, tax, legal, or retirementadvice or recommendations. Theinformation presented here is notspecific to any individual's personalcircumstances.

To the extent that this materialconcerns tax matters, it is notintended or written to be used, andcannot be used, by a taxpayer for thepurpose of avoiding penalties thatmay be imposed by law. Eachtaxpayer should seek independentadvice from a tax professional basedon his or her individualcircumstances.

These materials are provided forgeneral information and educationalpurposes based upon publiclyavailable information from sourcesbelieved to be reliable — we cannotassure the accuracy or completenessof these materials. The information inthese materials may change at anytime and without notice.

How can I avoid becoming a victim of a socialengineering scam?Imagine that you receive anemail with an urgent messageasking you to verify yourbanking information by clicking

on a link. Or perhaps you get an enticing textmessage claiming that you've won a freevacation to the destination of your choice — allyou have to do is click on a link you were sent.In both scenarios, clicking on the link canaccidentally result in revealing your sensitivepersonal and financial information to acybercriminal.

In a social engineering scam, a cybercriminalpsychologically manipulates victims intodivulging sensitive information. Cybercriminals"engineer" believable scenarios designed toevoke an emotional response (curiosity, fear,empathy, or excitement) from their victims. As aresult, people often react without thinking firstdue to curiosity or concern about the messagethat was sent. Since social engineering scamsappear in many forms and appeal to a variety ofemotions, they can be especially difficult toidentify.

Fortunately, there are steps you can take toprotect yourself from a social engineeringscam:

• If you receive a message conveying a senseof urgency, slow down and read it carefullybefore reacting. Don't click on suspicious orunfamiliar links in emails, text messages, andinstant messaging services.

• Never download email attachments unlessyou can verify that the sender is legitimate.Similarly, don't send money to an email thatrequests charitable help unless you canfollow up directly with the organization.

• Be wary of unsolicited messages. If you getan email or a text that asks you for financialinformation or passwords, do not reply, deleteit.

• Remember that social engineering scams canalso be used over the phone. Use healthyskepticism when you receive phone calls thatdemand money or request sensitive personaland financial information.

Is there any way to stop getting unwanted robocalls?Whether it's a helpfulannouncement from yourchild's school or anappointment reminder from adoctor's office, getting

robocalls has become an everyday occurrence.Unfortunately, robocalls are also used bycriminals to collect consumers' personal andfinancial information and/or conduct variousscams.

The good news is that consumers have wonadditional protections against unwantedrobocalls under the Telephone Robocall AbuseCriminal Enforcement and Deterrence(TRACED) Act. One of the main goals of thelaw is to make it easier for consumers to avoidunwanted robocalls by:

• Requiring all carriers to implement caller-IDtechnology at no additional cost to consumers

• Making it easier for law enforcement toprosecute illegal robocallers and increasingpenalties for robocall violations

• Creating an interagency task force to studyand improve government prosecution ofrobocall violations

Even when these new protections areimplemented, it will take some time to eliminateunwanted robocalls. In the meantime, here aresome things you can do to protect yourself:

• Don't answer calls when you don't recognizethe phone number.

• If you pick up an unwanted robocall, hang upright away and avoid answering "yes" or "no"questions, providing personal information, orpressing a number to "opt out."

• Consider signing up for a robocall blockingservice. Many phone service providers nowoffer robocall blocking solutions at noadditional charge, or you can downloadadditional robocall protection through athird-party app.

• Register your phone number on theNational Do Not Call (DNC) Registry, whichremoves your number from the call lists usedby legitimate telemarketing companies. Keepin mind that registering with the DNC Registrywill result in your getting fewer calls fromlegitimate telemarketers, but it won't stopillegal robocallers from contacting you.

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