“ Our clients were like , ‘ Hey , how come our distribution got larger ?’ And we took a look and said , ‘ Yeah , why did it get larger ?’” says Benson , owner of Sonmore Financial in Chandler , Ariz .

ADVISOR PHOTOGRAPH SOURCE , SONMOREFINANCIAL . COM .

The sudden change meant that the retirees had to deal with the extra burden of making estimated tax payments or withholding state income tax from other sources . And because they are not used to making these quarterly payments , many of them were at risk of being penalized for under-withholding taxes , Benson notes .

Benson , who heads the advocacy team for the Financial Planning Association ’ s Phoenix chapter , began to look closer at why the change had happened . He initially checked with Charles Schwab , his firm ’ s custodian , and state officials to try to understand who had made the change .

It wasn ’ t just his Schwab clients who noticed it . Most of the major custodians had suddenly stopped allowing state income tax to be withheld from IRA distributions , Benson says . The Arizona statute that governs state income tax withholding was drafted some 50 years ago with the intention of accommodating only pensions and annuity incomes , since 401 ( k ) s and IRAs were not commonplace back then , he says , but before last year , the custodians allowed taxes to be withheld from the newer accounts too .

While it ’ s not clear why the custodians made the reversal , Benson and others surmised that some of the custodians may have had the same legal or legislative counsel who flagged the old law and decided IRAs were not included . “ It caught us off guard , and I think it also caught the state Department of Revenue off guard ,” he says .

But Benson says that once he and others learned of the old statute and how it was being interpreted , he convened a meeting last October with state officials , including Arizona state Sen . J . D . Mesnard , the state ’ s Department of Revenue and a legislative policy representative from Schwab . “ Everyone was in agreement that this really needs to be resolved through the legislative process ,” he says .

Shortly after , Mesnard drafted a bill ( SB 1358 ), which also had input from the Arizona Society of CPAs . It was officially signed into law by Gov . Katie Hobbs in March .

“ I ’ m proud that through the relationships we ’ ve built over the last three to five years , we were able to bring about a change that benefited retirees in Arizona and the financial advisory industry to better assist their clients ,” Benson says .

This was not the first time he sought change to aid retirees . In 2019 , he helped spearhead a bill designed to shield vulnerable seniors from financial exploitation . He said family members in many cases are the source of such exploitation , and financial planners , he notes , oftentimes are the only ones in a position to shed light on the situations because of the intimate relationships they have with their clients .

That bill ( SB 1483 ) was also sponsored by Mesnard and became law in 2019 . “ What this bill does is it gives financial planners a tool to help put a temporary stop to a transaction ” that could be financial exploitation and might warrant a report to the authorities , Benson says .

While Benson heads the FPA advocacy team , he credits five to seven other members who “ have really done a good job of being more involved in advocacy .” He notes that none of them have policy , government or legislative affairs backgrounds , but over the past six years they have engaged with and learned from state operators and legislative officials and forged a good relationship with them .

“ When we have matters that we support or oppose , they are much more receptive to hearing us out . They know who we are , and they know what our organization is about , and they know how we serve our clients ,” he says .

Benson began his journey in the financial industry with Vanguard in 2014 , where he spent a year before joining Next Financial Group . He left at the end of 2020 and opened Sonmore Financial in 2021 .

The practice includes two other staffers

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