Account Details

• Use this page to enter detailed account information.

• In NaviPlan, FICA calculations take the following figures into account:
• Social Security Tax - Employment
• 6.2% of income up to a given cap.
• More information about Social Security Thresholds can be found here.
• Medicare Tax - Employment
• (AGI * 1.45%) + ((AGI - Threshold to a minimum of $0) *0.9%)
• The Thresholds are as follows:
  

  Married, Filing Jointly	$250,000
  Married, Filing Separately	$125,000
  Single/Head of Household	$200,000

• FICA taxes on the NQDC transaction will be imposed in the year entered on the Distributions subtab. NQDC income will be included as Pension Income in the Income Tax Details report for the year in which FICA taxes apply.
• Unless otherwise indicated on the Distributions subtab, 100% of NQDC income is considered taxable for FICA purposes in the year received. Cash flow will be unaffected, with the exception of taxation.

• In certain instances, changes made to the associated account or annuity in the plan can invalidate the substantially equal periodic payments (SEPP) strategy. Consider the following factors when modifying plans that contain a SEPP strategy:
  • Only certain types of qualified accounts are valid for a SEPP strategy.
  • A SEPP strategy cannot be set up for accounts or annuities that are being treated as deferred compensation plans.
  • Guaranteed Withdrawal Benefit cannot be selected from the Income Option list for an annuity used in a SEPP strategy.
  • Only one SEPP strategy can be entered per account or annuity.
  • An annuity’s Annuitization Start Date cannot occur before the SEPP strategy’s start date.
  • SEPP strategies cannot be applied to inherited IRAs.

How do I setup a savings strategy?

1. Select Add Savings Strategy.
2. In the newly-created row, enter basic information for the saving strategy including the Owner, Frequency, Start Date, and End Date.
   • Use the Infl and +/- Add'l fields to index the savings strategy for inflation and/or any other value.
3. When you are satisfied with these options, click OK.

How do I completely redeem an account?

1. Select the Redeem All check box.
2. If applicable, select the Waive Early Withdrawal Penalties check box to exclude penalties if the asset is withdrawn early.
3. If applicable, select the Tax-Free Withdrawal check box to exclude any taxes on redemption.
4. In the Start Date field, enter the date of redemption.
5. When you are satisfied with these options, click OK.

How do I setup a redemption strategy for an account?

1. Click Add Redemption Strategy.
2. Select the source account from the Redeem from menu.
3. Enter the dollar value for the redemption and how often redemptions will occur in the Amount and Frequency fields.
4. If applicable, select the Waive Early Withdrawal Penalties check box to exclude penalties if the asset is withdrawn early.
5. If applicable, select the Tax-Free Withdrawal check box to exclude any taxes on redemption.
6. In the Start Date field, enter the date on which the redemption will start. In the End Date field, enter the date on which redemptions will end.
7. When you are satisfied with these options, click OK.

How do I setup a SEPP strategy for an account?

Note: Only one SEPP strategy can be added to an account or annuity.

1. Click Add SEPP Strategy.
2. Enter a Start Date and a Frequency for the SEPP.
3. Select the method of payment from the Distribution Method menu.
4. If applicable, select Pro-Rate First/Last Payments.
5. When you are satisfied with these options, click OK.

How do I enter new values for an account's rate of return?

1. Select Override.
2. Enter new values for each category, the Total fields update automatically as you work.
   Note: You can enter different values for the Retirement and Pre-Retirement periods.
3. When you are satisfied with these options, click OK.

How do I change for my account reinvestment strategies?

1. In a non-qualified, you may adjust reinvestment strategies to:
   • Reinvest After-Tax: Taxes are paid on investment growth, the remainder are then placed back into the account.
   • Reinvest All: Reinvests all investment proceeds into the account, taxes will be paid by cash flow.
   • Reinvest None: Reinvests no investment proceeds back into the account, goes directly into cash flow.
     

Note: You can enter different strategies for the Retirement and Pre-Retirement periods.

How do I define an annual fee for an account?

1. Select Override.
2. Enter basic information for the annual fee including the Annual Fee Amount, Frequency, where to Pay Fees From, and whether or not the fee is Tax Deductible.
3. When you are satisfied with these options, click OK.

How do I define distributions for Non-Qualified Deferred Compensation type account?

1. Make sure Non-Qualified Deferred Compensation is selected as the Account Type.
   This procedure will vary based on what type of distribution you want to model. Select the option below that best describes the type of distribution you want to model.

Types of Available Distributions
Lump Sum distribution with system-defined FICA taxes Lump Sum distribution with user-defined FICA taxes	Periodic distributions with system-defined FICA taxes Periodic distributions with user-defined FICA taxes

Continued steps from Lump Sum distribution with system-defined FICA taxes:

2. Select a destination for proceeds of the distribution from the Direct After Tax Proceeds To menu.
3. Select Lump Sum from the Type menu.
4. Enter the date on which the distribution is scheduled to occur in the Start Date field.
5. Define what should happen with the distribution in the event of death using the options in the At Death Option section.
6. When you are satisfied with these options, click OK.

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Continued steps from Lump Sum distribution with user-defined FICA taxes:

2. Select a destination for proceeds of the distribution from the Direct After Tax Proceeds To menu.
3. Select Lump Sum from the Type menu.
4. Enter the date on which the distribution is scheduled to occur in the Start Date field.
5. Define what should happen with the distribution in the event of death using the options in the At Death Option section.
6. Review the default entries for Year to Impose FICA taxes and % Applicable to FICA Taxes. Select the corresponding option to make changes to either field.
7. Enter any changes to the default assumptions.
8. When you are satisfied with these options, click OK.

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Continued steps from Periodic distributions with system-defined FICA taxes:

2. Select a destination for proceeds of the distribution from the Direct After Tax Proceeds To menu.
3. Select Periodic from the Type menu.
4. Select how often the distribution is to occur using the Frequency menu.
5. Define the period over which the distribution will occur using the Start Date and End Date fields.
6. Define what should happen with the distribution in the event of death using the options in the At Death Option section.
7. When you are satisfied with these options, click OK.

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Continued steps from Periodic distributions with user-defined FICA taxes:

2. Select a destination for proceeds of the distribution from the Direct After Tax Proceeds To menu.
3. Select Periodic from the Type menu.
4. Select how often the distribution is to occur using the Frequency menu.
5. Define the period over which the distribution will occur using the Start Date and End Date fields.
6. Define what should happen with the distribution in the event of death using the options in the At Death Option section.
7. Review the default entries for Year to Impose FICA taxes and % Applicable to FICA Taxes. Select the corresponding option to make changes to either field.
8. Enter any changes to the default assumptions.
9. When you are satisfied with these options, click OK.

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• NaviPlan sets certain data fields by default. In some cases, these defaults are based on system calculations; in others, they are simply good working assumptions. Select Override to make these fields editable so that you can replace any data that is inappropriate for your clients' plan.

Community Property

• If selected, defines the account as community property. In states with community property laws, any property acquired by a married couple residing in a community property state is considered to be equally owned by both parties. This check box is not available if the client’s or co-client’s tax filing status is Single or Head of household.
  
  Note: The Community Property check box does not appear for qualified accounts and UTMAs.

Inherited

• If selected, indicates that the account is inherited by someone other than the co-client on the owner’s death.
  
  Note: This check box only appears if IRA, IRA - Spousal, Roth IRA, or Roth IRA - Spousal is selected as the account type.

Decedent’s Date of Death

• Date of death of the account’s original owner.
  
  Note: This field only appears if IRA or Roth IRA is selected as the account type.

Withdrawals are Exempt from State Income Taxes

• If selected, indicates that any withdrawals from the 529 plan or Coverdell account are tax exempt. The named beneficiary can withdraw from the fund without the 10% penalty on gain.
  

Reinvestment Strategy

• Indicate whether after-tax income should be reinvested or sent to cash flow for the pre-retirement and retirement periods.