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Volume 3, Issue 8, November 2005

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Congratulations to the University of Southern
Indiana! Winners of the 2005 Indiana CPA Society Case Study Competition

Kemper CPA Group LLP wishes to offer congratulations to the University of Southern Indiana (USI) for winning the 2005 Indiana CPA Society Case Study Competition. This is a tremendous accomplishment, made even more impressive by the fact that USI also won the 2004 competition!

The team of four USI students includes junior Nathan Atkinson from Kansas City, Missouri; junior Andrew Eddmenson from Madisonville, Kentucky; senior Kevin Farley from Huntingburg, Indiana; and senior May Flores from Newburgh, Indiana. They competed against nine other teams from schools throughout Indiana. The teams were given a case study and had ten days to research the topic and to submit a written report.

After preliminary judging of the reports submitted by each team, six finalists were selected to give a verbal presentation of their report to a group of judges. The report and presentation from the University of Southern Indiana students were judged to be the best among the finalists.

The team from Indiana University-Bloomington finished in second place, while Valparaiso University’s team took third place honors. Kemper CPA Group LLP is a proud sponsor of the Indiana CPA Society Case Study Competition, and we extend our congratulations to all of the participants – well done!

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IRS Announces 2006 Inflation Adjustments

In order to keep up with inflation, the IRS makes revisions to a variety of tax provisions each year. For 2006 returns, which will be filed in 2007, more than thirty tax benefits have been modified. Below is a summary of the key changes that will affect virtually every taxpayer:

The value of each personal and dependency will be $3,300, an increase of $100 from 2005.

The standard deduction for 2006 will be $10,300 for married couples filing a joint return, $5,150 for single filers, and $7,550 for heads of household.

The taxable-income threshold separating each tax bracket will increase for each filing status.

The annual gift tax exemption will increase from $11,000 in 2005 to $12,000 in 2006.

A complete listing of the 2006 inflation adjustments is contained in IRS Revenue Procedure 2005-70. If you have any questions about the way that these adjust-ments affect you, contact the tax professionals at Kemper CPA Group LLP today.

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Save for Retirement, or College? Try for both…

You have the job, the house, you’re married, and you’ve started a family. Saving money for your children’s college fund is certainly an important part of planning for their future. But, are you saving for college at the expense of saving for retirement?

You might want to rethink that…

Consider this – the sooner you start saving for retirement the better, because while college costs can be defrayed through scholarships, student loans and grants, retirement costs cannot. The greatest benefit to saving for retirement at an early age is the fact that the money earns interest over a long period of time. If you wait until your children are finished with college before you seriously begin saving for your retirement, you will have lost the compounding of interest on over 20 years of earnings.

Yes, expenses are high when you are just starting out; however, if you can divert even a small percentage of your income into a retirement fund at first, you can also learn to live without that income. And that will make it easier to increase that amount over time, allowing your retirement savings to grow at an even greater rate. If your employer offers a company 401(k) program, take advantage of it and begin investing a percentage of your salary. You can also take advantage of options such as 529 college savings plans to help fund your children’s education. The friendly professionals at your local Kemper office can help you plan for your children’s college funds, as well as a comfortable retirement. Contact us today!

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Saving for College: Investing in a 529 Plan

Over the past several years, the cost of attending college has continued to increase, and it is becoming increasingly important for families to consider saving for a child’s post-secondary education. Section 529 state college savings plans, named for the IRS code that governs them, allow parents, grandparents, and other relatives to contribute to a child’s college education fund, while offering a number of tax benefits.

Each state has its own Section 529 Plan, and most states allow non-residents to contribute to their plans, although investing in your own state’s plan may entitle you to state tax deductions on contributions or exemptions on withdrawals. As long as earnings from the Section 529 college savings plan are used for qualified higher education expenses, the funds are not subject to federal income tax. Qualified higher education expenses include, but are not limited to, tuition, room and board, fees, and books.

In addition to the benefit of tax-free earnings, Section 529 Plans offer the following benefits:

Tax laws allow for an exemption for gifts up to $55,000 at a time, $110,000 for married couples

The donor maintains control of the funds until they are withdrawn by the beneficiary

The contributor is not subject to any Adjusted Gross Income limitations

If the beneficiary does not use the funds or does not incur any higher educational expenses, the funds can be withdrawn or transferred to another beneficiary

Although a 529 plan has only one owner for tax purposes, others may make contributions to the account

Donors may contribute a lump sum or make smaller contributions over a period of time

The contribution is considered a completed gift; therefore, it is exempt from estate tax for the donor

If you would like any additional information about investing in a Section 529 state college savings plan, contact the tax professionals at Kemper CPA Group LLP today!

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Loose Change

The November/December 2005 issue of the "Loose Change" Newsletter includes the following articles:

Contact us today for all of your investing needs.

Investment advisory services offered by KCPAG Financial Advisors LLC, a registered investment advisor. Securities officered through Securities America, Inc., a registered broker/dealer. Member NASD/SIPC. Thomas A. Moore, John D. Porter, Polly Reynolds, Shawna D. Horne, Jeffery C. Holt, CA insurance Lic. #0E38034, Jessica Daugherty, Sheila R. Lautenbacher, Joseph M. Mendes, CA Insurance Lic. #0C62535, Regina S. Hughes, Gregory Meador, Marcia Elder, Registered Representatives. Insurance services offered through KCPAG Insurance Services LLC. Kemper Capital Management LLC and its subsidiaries are not affiliated with Securities America.

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Kemper Technology Consulting and Postini® –
The Answer for E-mail Protection

Experts estimate that the growth in spam traffic now requires companies to add 5 to 10 times the normal message capacity with extra servers that must be bought, maintained, tuned, and patched. Additionally, directory harvest attacks dramatically increase the number of messages companies’ e-mail infrastructures must handle – with some companies experiencing increases up to thousands per day!

Unwanted e-mail is more than just irritating – it brings with it an increase in risk of exposure to viruses, and it costs companies in terms of wasted bandwidth and server storage capacity and decreased employee productivity. Kemper Technology Consulting offers an effective and affordable solution – Postini® message filtering service.

According to Postini® statistics, 10 out of 14 e-mail messages are spam, and 1 in 56 contains a virus.

With Postini®, incoming e-mail is filtered for spam outside your network perimeter and stored in each user’s off-site message center, where it can be accessed, and, if desired, delivered to the user’s inbox. Virus-laden messages are also quarantined to the message center, where the content can be viewed safely off-site. Because Postini® stores spam messages off-site, you don’t need to invest in extra servers to handle the influx of traffic that unsolicited e-mail generates, and spam doesn’t hinder the performance of your existing e-mail infrastructure system.

To see what Kemper Technology Consulting and Postini® can do for your business, contact us before December 31, 2005 to take advantage of our special offer – a free 30-day trial and no set-up fee!

Kemper Technology Consulting
Robinson, IL
618-546-5633
www.kempertc.com
Evansville, IN  •  Indianapolis, IN  •  Paducah, KY

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Please be advised that, based upon current Internal Revenue Service (IRS) rules and standards, the advice herein is not intended to be used, nor can it be used, as the sole basis for decisions. Additional issues may exist that could affect the treatment of the individual transactions, and this narrative does not provide a conclusion with respect to all such issues.

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