Can I claim a dependent in Mexico?

So we are getting this question nearly every day and the answer is yes….. and no.

For the sake of the federal return you can put them on the dependents screen but you must disqualify them from the $500 credit.
The reason one would do this is for state benefits. As in the state of CA (where we are located) the tax code is still the same
as in previous years. Also for Individuals who revived Covered California (obamacare) this is very important as the premium
assistance is based on the number of dependents reported on ones taxes. If you do not do this you are going to be libel for
a large repayment on the subsidy that you are truly not responsible for

Claiming a dependent in Mexico is different then a regular dependent. It was never the White Houses intention to remove ones
head of household status due to the new rules. So this means you can still Claim your dependent parent as long as they qualify
under the rules. You will still have to remove the $500 dependent credit but the benefit of the new Head of Household deduction
will more then make up for the loss of the exemption.

If you would like some more info please just click the contact button and reach out with any specific questions. Have a great day!

I get asked all the time if an earthquake is covered under a standard homeowners policy, and i would just like take this opportunity in the
wake of the recent hurricanes to write something about the biggest natural disaster we may face here in California, Earthquakes and what
you can do to protect your home and property from them.

First off, NO your standard homeowners policy will not cover any damage caused to your home or belongings by an earthquake. It is
necessary to purchase an additional policy though the state of California (the California Earthquake Authority) to cover damages caused by
a quake. But even with these policies you will not be made 100% whole as in a standard Homeowners policy. That is not the way the
system is set up.

The CEA (California Earthquake Authority) was created to keep a roof over your head. The deductibles are not a numerical amount
as in a standard policy but based on percentage. Depending on what you chose this deductible percentage can go from 5%-25%, the lower the percentage the higher the premium.

Next is the personal property coverage. This coverage covers.. well… your personal property. But it will only cover from $5,000 to $200,000, and the deductible is on the same percentage scale as the home.

Lastly, and this is an extremely important coverage is the Loss Of Use Coverage. This is going to cover your expenses to live in hotels, eating
out, and any other expenses created by you and your family’s displacement. This coverage has a range from $1,500 to $100,000.

So that is the nuts and bolts of a Earthquake policy and as you can see is not nearly as comprehensive as a standard policy but if
the worst was to happen you will be happy you have it. If you want some more details on how these policies work or want to get a
quote give us a call and we will be happy to help in any way we can. Have a great day!

Michael Palmer

How the Covered California Rate Increase May Affect You


There has been lots of news lately about the Rate Increase taking place in 2017 with regards to Covered California (Obamacare). Unfortunately, these uprates are going to hit consumers harder than many are expecting. Covered California has announced an average of 14% increase to rates next year, but what many don’t realize is this increase could double your out of pocket premium. Let me explain.

(This is a Fictional example and John is not a real person)

Let’s say John has a Covered California policy that covers his family of 4. He pays $200 in out of pocket premiums per month. Although the entire premium of the Policy is $1000 per month, John is receiving an $800 monthly subsidy from Covered California. If his policy goes up the 14% as reported in 2017, his overall premium will now be $1140 per month. There is a possibility his subsidy is going to stay the same at $800 per month, and it will fall on John to cover the ENTIRE UPRATE. Due to this 14% increase, His out of pocket monthly premium will now be $340 a 70% increase.

So even though Covered California is claiming one thing, in all actuality this increase will affect the insured much more severely than is being advertized.

As always, Palmer Insurance & Income Tax is here to help guide you through the murky waters that is Covered California. With updates to income and a reevaluation of coverage often times we are able to keep your premium Similar to what you have been previously paying. Give us a call or click “contact us” above with any questions or comments you may have.

Michael Palmer