VISTA Wealth Strategies LLCJudy L. Redpath, CFP®, AIF®California Insurance License#0C1889512020 Sunrise Valley DriveSuite 180Reston, VA 20191703-295-9322Fax: (703) 552-3030jredpath@vistaws.comwww.vistaws.com

Summer 2019Key Estate Planning Documents

Charitable Giving After Tax Reform

Do I need to get a REAL ID when Irenew my license?

Is a vehicle subscription service in yourfuture?

Ten Money-Saving Travel Tips

See disclaimer on final page

We've experienced the changes inincome tax laws that took effect for2018. A number of our clients haveadjusted tax withholdings orestimated tax payments as aconsequence. If your tax situationhas changed, please give us a callfor a review. We anticipate changesin the retirement plan laws this year,which - if passed - will create anopportunity for us to revisit yourestate plans and beneficiarydesignations.

In the meantime, enjoy summer'sfine weather and a few mid-yearplanning ideas.

Exploring the worldsounds fun andexciting, but it canbe expensive totravel. However,there are ways toexperience the tripof your dreams on abudget. Follow thesemoney-saving tipswhen planning your

next vacation to help make it more affordable.

1. Join a frequent flyer program. It willprobably take time to accumulate frequent flyerpoints, but the perks can be worth it. Dependingon the program, rewards can include cheaperfares, upgrades, free companion tickets, andmore.

2. Be flexible with scheduling. Timing yourticket purchases wisely can help you save big.Aim to travel during days of the week whenairfare tends to be cheaper. Similarly, try to flyat unpopular hours (e.g., early morning orred-eye flights) for more affordable pricing.Avoid traveling during peak holiday seasonsand school breaks, and be aware of big eventssuch as conferences or trade shows that tendto make hotel prices soar.

3. Comparison shop. Research online to findthe cheapest flights to your desired destination.Mix and match your airlines and airports for thebest rates — you might discover that twoone-way tickets are cheaper, overall, thanpurchasing one round-trip ticket. Considerall-inclusive options, since the up-front priceyou pay is usually the total cost of your trip.

4. Pack smart. Checked baggage fees canrack up quickly, especially if you exceed anairline's weight limit. Try to stick with carry-onluggage or just remember to pack lightly toavoid paying extra for overweight bags.

5. Consider alternatives to hotels. Lower-costlodging options can include hostels,home-exchange programs, B&Bs, and vacationrentals. But they do require careful research.Find a match that best suits your needs bynarrowing down potential options according to

your budget, number of guests, length of stay,and space requirements. Look at ratings andreviews to determine whether a particularlocation and property will work for you.

6. Download apps to your smartphone. Takeadvantage of free travel apps that can help yousave money on things like gas, car rental,airfare, hotels/accommodations, and more. Findand download messaging apps that your familyand friends also have so you don't have to payfor text messages you send/receive whiletraveling.

7. Reduce mobile roaming charges. After arelaxing vacation, you probably won't want tocome home to an expensive phone bill due todata roaming charges. Fortunately, manymobile networks offer data roaming deals, socheck with your phone's carrier to learn aboutpackages and discounts that may be availableto you. And before you embark on your travels,adjust settings on your phone to disable dataroaming as well as software downloads. Appand phone updates are important, but most canwait until you are connected to Wi-Fi, which isavailable for free at many places.

8. Find free activities. Regardless of whereyou're traveling, it's likely that there are plentyof fun and free or low-cost activities.Sightseeing, walking, browsing stores, andattending local concerts/fairs/cultural events aregreat ways to explore a new place withoutspending too much (or any) money.

9. Act like a local. Blend in with the locals bydining out and shopping at stores located awayfrom popular tourist streets. Prepare your ownfood when it's practical, and don't shy awayfrom street food — it's less expensive than asit-down restaurant.

10. Save on car rental. If possible, stick withpublic transportation on your trip. But if youmust rent a car, book the cheapest option youcan find online. You can save even moremoney by choosing to forego car rentalinsurance, but you'll want to review yourexisting auto insurance policy first to see if itcomes with some form of coverage for rentals.

Page 1 of 4

Key Estate Planning DocumentsEstate planning is the process of managing andpreserving your assets while you are alive, andconserving and controlling their distributionafter your death. There are four key estateplanning documents almost everyone shouldhave regardless of age, health, or wealth. Theyare: a durable power of attorney, advancemedical directives, a will, and a letter ofinstruction.

Durable power of attorneyIncapacity can happen to anyone at any time,but your risk generally increases as you growolder. You have to consider what would happenif, for example, you were unable to makedecisions or conduct your own affairs. Failing toplan may mean a court would have to appoint aguardian, and the guardian might makedecisions that would be different from what youwould have wanted.

A durable power of attorney (DPOA) enablesyou to authorize a family member or othertrusted individual to make financial decisions ortransact business on your behalf, even if youbecome incapacitated. The designatedindividual can do things like pay everydayexpenses, collect benefits, watch over yourinvestments, and file taxes.

There are two types of DPOAs: (1) animmediate DPOA, which is effective at once(this may be appropriate, for example, if youface a serious operation or illness), and (2) aspringing DPOA, which is not effective unlessyou become incapacitated.

Advance medical directivesAdvance medical directives let others knowwhat forms of medical treatment you prefer andenable you to designate someone to makemedical decisions for you in the event you can'texpress your own wishes. If you don't have anadvance medical directive, health-careproviders could use unwanted treatments andprocedures to prolong your life at any cost.

There are three types of advance medicaldirectives. Each state allows only a certain type(or types). You may find that one, two, or allthree types are necessary to carry out all ofyour wishes for medical treatment.

• A living will is a document that specifies thetypes of medical treatment you would want,or not want, under particular circumstances.In most states, a living will takes effect onlyunder certain circumstances, such as aterminal illness or injury. Generally, one canbe used only to decline medical treatment

that "serves only to postpone the moment ofdeath."

• A health-care proxy lets one or more familymembers or other trusted individuals makemedical decisions for you. You decide howmuch power your representative will or won'thave.

• A do-not-resuscitate (DNR) order is a legalform, signed by both you and your doctor,that gives health-care professionalspermission to carry out your wishes.

WillA will is quite often the cornerstone of an estateplan. It is a formal, legal document that directshow your property is to be distributed when youdie. If you don't leave a will, disbursements willbe made according to state law, which mightnot be what you would want.

There are a couple of other important purposesfor a will. It allows you to name an executor tocarry out your wishes, as specified in the will,and a guardian for your minor children.

The will should be written, signed by you, andwitnessed.

Most wills have to be probated. The will is filedwith the probate court. The executor collectsassets, pays debts and taxes owed, anddistributes any remaining property to the rightfulheirs. The rules vary from state to state, but insome states smaller estates are exempt fromprobate or qualify for an expedited process.

Letter of instructionA letter of instruction is an informal, nonlegaldocument that generally accompanies your willand is used to express your personal thoughtsand directions regarding what is in the will (orabout other things, such as your burial wishesor where to locate other documents). This canbe the most helpful document you leave foryour family members and your executor.

Unlike your will, a letter of instruction remainsprivate. Therefore, it is an opportunity to say thethings you would rather not make public.

A letter of instruction is not a substitute for awill. Any directions you include in the letter areonly suggestions and are not binding. Thepeople to whom you address the letter mayfollow or disregard any instructions.

Take steps nowLife is unpredictable. So take steps now, whileyou can, to have the proper documents in placeto ensure that your wishes are carried out.

There are four key estateplanning documents almosteveryone should haveregardless of age, health, orwealth: a durable power ofattorney, advance medicaldirectives, a will, and a letterof instruction.

Page 2 of 4, see disclaimer on final page

Charitable Giving After Tax ReformTax reform changes to the standard deductionand itemized deductions may affect your abilityto obtain an income tax benefit from charitablegiving. Projecting how you'll be affected bythese changes while there's still time to takeaction is important.

Income tax benefit of charitable givingIf you itemize deductions on your federalincome tax return, you can generally deductyour gifts to qualified charities. However, manyitemized deductions have been eliminated orrestricted, and the standard deduction hassubstantially increased. You can generallychoose to take the standard deduction or toitemize deductions. As a result of the changes,far fewer taxpayers will be able to reduce theirtaxes by itemizing deductions.

Taxpayers whose total itemized deductionsother than charitable contributions would beless than the standard deduction (includingadjustments for being blind or age 65 or older)effectively have less of a tax savings incentiveto make charitable gifts. For example, assumethat a married couple, both age 65, have totalitemized deductions (other than charitablecontributions) of $15,000. They would have astandard deduction of $27,000 in 2019. Thecouple would effectively receive no tax savingsfor the first $12,000 of charitable contributionsthey make. Even with a $12,000 charitablededuction, total itemized deductions of $27,000would not exceed their standard deduction.

Taxpayers whose total itemized deductionsother than charitable contributions equal orexceed the standard deduction (includingadjustments for being blind or age 65 or older)generally receive a tax benefit from charitablecontributions equal to the income taxes saved.For example, assume that a married couple,both age 65, have total itemized deductions(other than charitable contributions) of $30,000.They would be entitled to a standard deductionof $27,000 in 2019. If they are in the 24%income tax bracket and make a charitablecontribution of $10,000, they would reduce theirincome taxes by $2,400 ($10,000 charitablededuction x 24% tax rate).

However, the amount of your income taxcharitable deduction may be limited to certainpercentages of your adjusted gross income(AGI). For example, your deduction for gifts ofcash to public charities is generally limited to60% of your AGI for the year, and other gifts tocharity are typically limited to 30% or 20% ofyour AGI. Charitable deductions that exceedthe AGI limits may generally be carried overand deducted over the next five years, subjectto the income percentage limits in those years.

Year-end tax planningWhen making charitable gifts during the year,you should consider them as part of youryear-end tax planning. Typically, you have acertain amount of control over the timing ofincome and expenses. You generally want totime your recognition of income so that it will betaxed at the lowest rate possible, and to timeyour deductible expenses so they can beclaimed in years when you are in a higher taxbracket.

For example, if you expect that you will be in ahigher tax bracket next year, it may makesense to wait and make the charitablecontribution in January so you can take thededuction next year when the deduction resultsin a greater tax benefit. Or you might shift thecharitable contribution, along with otheritemized deductions, into a year when youritemized deductions would be greater than thestandard deduction amount. And if the incomepercentage limits above are a concern in oneyear, you might consider ways to shift incomeinto that year or shift deductions out of thatyear, so that a larger charitable deduction isavailable for that year. A tax professional canhelp you evaluate your individual tax situation.

Qualified charitable distribution (QCD)If you are age 70½ or older, you can maketax-free charitable donations directly from yourIRAs (other than SEP and SIMPLE IRAs) to aqualified charity. The distribution must be onethat would otherwise be taxable to you. Youcan exclude up to $100,000 of these QCDsfrom your gross income each year. And if youfile a joint return, your spouse (if 70½ or older)can exclude an additional $100,000 of QCDs.

You cannot deduct QCDs as a charitablecontribution because the QCD is excluded fromyour gross income. In order to get a tax benefitfrom your charitable contribution without thisspecial rule, you would have to itemizedeductions, and your charitable deduction couldbe limited by the percentage of AGI limitations.QCDs may allow you to claim the standarddeduction and exclude the QCD from income.

QCDs count toward satisfying any requiredminimum distributions (RMDs) that you wouldotherwise have to receive from your IRA, justas if you had received an actual distributionfrom the plan.

Caution: Your QCD cannot be made to aprivate foundation, donor-advised fund, orsupporting organization. Further, the gift cannotbe made in exchange for a charitable giftannuity or to a charitable remainder trust.

Some of the recent changesto the standard deductionand itemized deductionsmay affect your ability toobtain an income tax benefitfrom your charitablecontributions. Incorporatingcharitable giving into youryear-end tax planning maybe even more importantnow. If you are age 70½ orolder and have a traditionalIRA, you may wish toconsider a qualifiedcharitable distribution.

Page 3 of 4, see disclaimer on final page

VISTA Wealth Strategies LLCJudy L. Redpath, CFP®, AIF®California Insurance License #0C1889512020 Sunrise Valley DriveSuite 180Reston, VA 20191703-295-9322Fax: (703) 552-3030jredpath@vistaws.comwww.vistaws.com

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2019

Securities and Advisory Servicesoffered through CommonwealthFinancial Network, MemberFINRA/SIPC, a RegisteredInvestment Adviser. Fixedinsurance products and servicesoffered by VISTA WealthStrategies LLC or CES InsuranceAgency. VISTA Wealth StrategiesLLC does not provide legal or taxadvice. Please consult with a legalor tax professional regarding yourindividual situation. CaliforniaLicense # 0C18895.

Is a vehicle subscription service in your future?Automakers and start-upcompanies are betting thattoday's generation of driverswill embrace a new model oftemporary ownership called a

vehicle subscription service.

A vehicle subscription service offers analternative to buying or leasing. You don't haveto sign a long-term contract or commit to justone vehicle. Once you join, you typically pay anall-inclusive monthly or sometimes weekly feethat covers the cost of using the vehicle youchoose, including insurance, routinemaintenance, roadside assistance, and awarranty. You then have the option of swappingout your vehicle periodically, depending on theterms of your subscription.

For example, perhaps you've been temporarilytransferred to a new city and want afuel-efficient car for the six months you're livingthere. Maybe you need a second car onlyduring the summer when your child is homefrom college. Or you might want the flexibility todrive whichever vehicle suits your needs at thetime — a luxury sedan for day-to-day driving,then a minivan for a family trip. If your needschange, you can return your vehicle and get

another, or end your subscription. Plans vary,but many subscription services require only ashort one- to two-month minimum commitment,with the option to renew. Subscription servicesare often app-based, making it easy to find andswap vehicles, and your newest ride may bedelivered to you via a concierge service.

Of course, flexibility and convenience come at acost, which is often substantial, so if you areinterested in subscribing to your next vehicleyou'll need to carefully assess your options.Prices depend on the subscription service, thevehicle selected, and other factors such asmileage and extras. You may also be requiredto pay a sign-up fee.

Vehicle subscription services are evolving andare still not available everywhere. Manyservices are in the testing phase, and mosthave been launched primarily in majormetropolitan markets such as Los Angeles, SanFrancisco, and New York, with a few offered inother cities. But vehicle subscription servicesare gaining traction, increasing the likelihoodthat they will someday be available in mostareas.

Do I need to get a REAL ID when I renew my license?If you need to renew yourdriver's license, you may wantto get a REAL ID. The REALID Act, passed by Congress in2005, enacts the 9/11

Commission's recommendation that the federalgovernment set minimum security standards forstate-issued driver's licenses and identificationcards.

Beginning October 1, 2020, residents of everystate and territory will need to present a REALID-compliant license/identification card, oranother acceptable form of identification (suchas a passport), to access federal facilities, enternuclear power plants, and board commercialaircraft. Although implementation has beenslow, states have made progress in meeting theREAL ID Act's recommendations. A majority ofstates and territories, along with the District ofColumbia, have complied with all REAL IDrequirements. The remaining noncompliantjurisdictions have been granted a temporaryextension from the Department of HomelandSecurity.1

To obtain a REAL ID, you must apply in personat your state's department of motor vehicles (orother approved service center). Your picture will

be taken and signature captured electronically.You must provide more documentation thanyou would normally need for a standard driver'slicense or identification card. A REAL IDrequires that you show (in original or certifiedform) proof of identity and lawful presence (e.g.,U.S. passport, birth certificate), state residency(e.g., mortgage statement, utility bill), andSocial Security number (e.g., Social Securitycard, paystub). In addition, if your current namedoesn't match the one on your proof of identitydocument, you must prove your legal namechange (e.g., marriage certificate).

When states first implemented REAL IDrecommendations, applicants were faced withdelays and long wait times. However, manystates have since streamlined the process byallowing applicants to start the applicationprocess online. For more information onapplying for a REAL ID, you can visit yourstate's department of motor vehicles website ordhs.gov/real-id.1 Department of Homeland Security, REAL IDCompliance Extension Updates, October 2018

Page 4 of 4