Thursday, February 14, 2019

It’s not the first time we’ve heard it, but talk is coming again about Donald Trump’s tax returns. With the Democrats holding power in the House of Representatives, the chance that those returns will be seen may be difficult to gauge with precision, but they are certainly greater than they were six months ago.
I wonder how this is going to play as we get deeper into the tax season. More people are going to be finding out just how the Tax Cuts and Jobs Act affects them, and you can be sure that the loudest voices are going to be the ones most drastically affected. So with more people talking about taxes, and possibly loudly talking about them, the president and his taxes will surely remain a talking point.
But just what would we find out if his returns are released?
First, the return would give only a rough look at how much Trump is actually worth. He claims it is billions of dollars at times, while detractors believe it to be a much smaller number. My bet would be that the truth lies – like it does with almost everything – somewhere in the middle. A tax return, though, deals in taxable income, not overall worth.
The returns do actually show some things, and a big one is just how much someone pays in taxes. At a time now when there are going to be people out there talking about how much more they are paying under the TCJA, I imagine that many are going to hope that Trump was paying his fair share.
Rhetoric in some areas is sure to amp up that Trump’s tax plan was made to benefit the wealthy, and that the wealthy are given advantages that allow them to pay less tax than they should. This could become tricky for the president who in the past  told ABC’s George Stephanopoulos that “I fight very hard to pay as little tax as possible,” back when his returns were an election issue.
It is important to note that this does not mean that Trump has done anything illegal, shady or underhanded. If the fact that he could pay next to nothing bothers someone, then the correct place to put the blame is on the system, not on someone working within that system. Even if it turns out that the system he helped implement further solidified his ability to pay little, one can say it’s wrong, but not illegal.
A tax return would also show how much money Trump gives to charity, which could also be a polarizing issue. Trump has claimed he is charitable, while others say the money he claims to donate is done through other organizations, where even if he is involved, it is not actually his money going to the charity.
So gear up for taxes to be news over the next few months for many reasons. And let this be a reminder that you need to handle your return, because even if the public doesn’t see it, the IRS wants to.  And it just so happens that many slots are available now to make your appointment to do so before everything amps up.

Wednesday, February 6, 2019


You know, last week I got to write the government shutdown had ended, and I thought that I might not have to really speak of it again …
You know, last week I was wrong.
So first, when the agency reopened, it warned of phone delays. Phone delays are always a part of dealing with the IRS, so if it found them worth nothing, then that is a promise of some serious delay.
Second, there is word that when the IRS fully opened up for business again, there were five million pieces of unopened mail to deal with. How that matches up with the claim that there would be no delay in getting refunds, I cannot quite comprehend. Heck, I cannot quite comprehend five million pieces of mail in the first place.
Then there is the IRS’s rather large list of FAQs for taxpayers following the shutdown. There was too much there for me to even go into in this space. But if you have any questions, click here to visit the agency’s website and see what they posted (under numerous headings, so further click through to the area that addresses your interest). If you need any further guidance, please do not hesitate to contact us.
At least this is all happening early in the tax season where we have time to navigate it before the time crunch gets heavier. At the same time, though, I urge you to use it as a reminder to not procrastinate starting your prep work, even this early.
I do want to move away from the IRS now, though, and write about what we can do beyond taxes. Consider this an urging to not only get ready for tax season, but get ready for what you want to do after tax season.
This is the time of year when almost everyone is paying more attention to their finances. These early months see us recovering from the holiday season, possibly making some resolutions for how we will handle our money, then looking at some year-end numbers when it comes to taxes.
But come May, it is so easy to let all of that fade into the background.
So if you are reading this and thinking about what you need to gather for when we meet to discuss your tax return, why not also bring something that we can talk about for beyond tax season. We will already be discussing your financial picture, so why not look toward its future?
We may not have the skills to help you with every question that comes up in this realm, but we are confident that we can at least connect you with people who can help. It is likely, though, that we do have the skills to help you with those issues and get you where you need to be. And at that point, we are already breaking down some numbers, so it could be that the work has already started.
So what is there to lose? Bring us something extra about your future, and we will endeavor to add some comfort to that future.

Wednesday, January 30, 2019


It feels almost unreal, but it is true – tax time is finally here. The filing season officially opened on Monday, January 28, which came with the added benefit of happening after the cessation of the government shutdown. Now of course, if this means the IRS was back up to full speed on Monday is unknown, and there is the lingering threat that we may only be a short time away from another shutdown. Regardless, though, we are full on into it being time to file.
This current tax season carries an extra touch of unreality because it seems that we have been getting ready for it even before last tax season began.  As soon as the Tax Cuts and Jobs Acts was passed at the end of 2017, last year almost became a prologue to when everything changed in 2019.
And yes, it’s true that in some way everything has changed. In all likelihood, your tax return is not going to look the same as it did last year. In other ways, though, not all that much has changed.
A big thing that should not change is the way that you prepare to file your taxes. Over the last couple of weeks, you have probably started to receive necessary tax forms in the mail. Hold onto them all. For some out there, it is true that they may not be as crucial as they were in the past (e.g. charitable donations may not matter if you now are taking the larger standard deduction), but you will not know if they matter or not unless you give them a shot. It is a good general rule that you can never have too much documentation.
Along those lines, it is now also time to get the paperwork together that does not come in the mail. This could be receipts, utility bills, or anything else that you ever used to prepare your tax return in the past. Yes, after we do this latest return it may turn out that some of those things are no longer necessary, but again, we will not know until we put all the numbers together.
For that is another thing that has not changed, our commitment to seeing that you file a tax return that uses the system to your greatest advantage. We hope that in the past you have been extremely satisfied with our work, and are confident that has been the case. And we work to see that you continue to feel that way as we work together under the new rules.
So get all those documents together now so we can continue on this journey. I know that it feels early before we even get to February (which can also mean that you do not yet even have access to all those necessary documents), but April 15th comes faster than we expect. I mean, it happens every year and still always seems surprising. So be proactive, and know that the sooner you make your appointment with us to get that return done, the better chance you have to get in at the times most convenient to you.

Wednesday, January 23, 2019


I know I have mentioned a few times about how the start of the year could be a good time to make a financial resolution. When looking at a recent article from Accounting Today – one entitled 10 Planning Tips for Starting 2019 Right – I realized that I did not actually give any ideas on what those resolutions could include. So I will attempt to remedy that by highlighting a couple of the entries on that list.
The first that I want to mention is to review your 2018 spending while budgeting 2019.  This seems obvious on one level, but it is something that can often be overlooked. If there are things that you want to accomplish in 2019, finding out how you can do it can best be accomplished with a year-long view at 2018. Weekly or monthly plans can be valuable, but a yearlong look helps you get a better idea for how things work over the long term and adds in some of the inevitable surprises that pop up over time.
Second, I’m going to blanket a few of the entries from the article with an overarching headline – Think About your Retirement. This is one of those things that a lot of people set up once and then never again think about. That, however, could result in you thinking about it too late. A little thought now on if you can/want/need to add more money into those plans can hold off a lot of future worry and anxiety.
Next, when it comes to those things that you can set up once and forget about, I bet you have a lot of them. And I bet there is AT LEAST one of them that has you paying for something you no longer use.  So why not cancel it? These can cover many areas - software, games, entertainment, gym memberships, etc. - which are all great if you are using them and getting your money’s worth. If you are not receiving that, though, stop giving your money away.
Finally, the article also includes an entry for updating your W-4 form for withholding. And there is some good news when it comes to that area.
Granted, this news is about a week old now, but I did want to at least mention it so that it didn’t appear I ignored it on purpose. Last week, the IRS announced that it was waiving a penalty for many who failed to withhold enough taxes during the 2018 tax year. I previously stated that I would be surprised if this happened, and well, color me surprised.
But just what color is surprise? Whatever it is, I hope it’s flattering.
So hey, count this as a wonderful bonus if you would have been subject to a fine if this special treatment was not being applied. But also let this serve as a reminder to look into it now so that you won’t face future penalties. And as always, we are happy to work together with you to make sure that it doesn’t happen or to help you with any other area where you are looking to improve.

Wednesday, January 16, 2019

Sometimes one finds inspiration in unlikely places.  This happened to me last weekend when I came across a quote from Pixar co-founder Ed Catmull from his book “Creativity, Inc.” This is a longer quote, but I hope you’ll forgive me for including it all:
“Instead, it was to send a signal about how important it is for every one of us to keep learning new things. That, too, is a key part of remaining flexible: keeping our brains nimble by pushing ourselves to try things we haven’t tried before. That’s what P[Ixar] U[niversity] lets our people do, and I believe it makes us stronger.
“We begin life, as children, being open to the ideas of others because we need to be open to learn. Most of what children encounter, after all, are things they’ve never seen before. The child has no choice but to embrace the new. If this openness is so wonderful, however, why do we lose it as we grow up? Where, along the way, do we turn from the wide-eyed child into the adult who fears surprises and has all the answers and seeks to control all outcomes?”
This is something that I would have said I agree with for years, but I think it struck me more since it spoke to much of what I’ve written in this space over the last few weeks.
First off, there has been enough written about the government shutdown, so I’ll try to keep this bit short. Suffice to say that no matter which side you fall on politically, there is a clear lack of ability for the parties in our government to work together. And when the government is shut down, I think all should be able to look beyond differences and agree that we need to be able to work together and be more open to listening to new ideas – even if that doesn’t seem like it’s going to happen anytime soon.
I also recently wrote about the idea of resolutions as we began the year and even if it seemed trite to use it as impetus to make some good financial moves you had thought about but had yet to pull the trigger on.
So putting all these thoughts together, let this also stand as a push to do something completely new, and not just a slight tweak to what you have already been doing. There’s an even greater chance for growth if you are moving into new areas.
That may be something that’s sticking out to me more due to our current national situation, but it’s impossible to say that Catmull isn’t coming from a place where we could always listen to him. After all, his book is really more about the business of Pixar than about the movies it makes and whether or not you cry at the beginning of “Up,” you cannot deny that the company is a very successful business.
Therefore, be new, be ready to grow, and go do something different. It just might lead you to better places than you thought possible.

Wednesday, January 9, 2019


Well, since last week’s writing about what to expect with taxes and the government shutdown, the IRS’s official plans have been released. Some of them were as expected, and some of them were surprising.
First, the expected part is that there will not be any movement in the calendar for the tax filing season. Returns will begin to be processed on January 28th with the standard end date of April 15th applying for almost everyone. (Those in Massachusetts and Maine get an extra two days due to their Patriots’ Day holiday on the 15th and the Emancipation Day holiday on the 16th in Washington DC.)
But then a surprise came because the IRS also announced that it would offer refunds to taxpayers as scheduled.  This went against previous releases by the agency about how it would handle a potential shutdown and after news of that proposed plan started to be heard more in the general media.
It stands to reason that that increased knowledge contributed to the change of plan. The longer the shutdown goes on, the more people are going to be affected (and frustrated) by it, and the government stood to receive increased backlash if many people were not receiving money rightfully owed to them.
So the takeaway from this is much the same as I stated last week – the government may be partially shut down, but your tax planning and preparation cannot be.
And this is the case no matter where your politics lie, even as taxes and politics promise to remain intertwined with a divided congress. This came into light some last week when Senator Ron Wyden, a Democrat from Oregon, sent a letter to IRS Commissioner Charles Retting asking the IRS to waive penalties that will be associated with some tax bills that Wyden expects taxpayers to face in the wake of the Tax Cuts and Jobs Act.
Last week, I said that I did not want to prognosticate about when the government shutdown would end. This time, however, I do think that I can effectively predict that Wyden’s pleas will not result in the IRS forgetting or forgiving penalties if people do not pay their tax bills.
This is a deft political maneuver by Wyden because he gets to show how he was a voice for people negatively affected by the TCJA before they even filed their taxes. And sure, there are going to be taxpayers a bit surprised when they get a tax bill not in line with what they’ve seen in the past.
It is still a political maneuver, though, for I do not anticipate there to be a great number of people seeing a huge tax bill of which they were completely unaware. It does show the push and pull that is going to continue when it comes to tax rules, though.
This further highlights the need to be prepared for your tax return. You are not going to know exactly what your return is going to look like until the tax year is over, but you can make very good guesses and be ready for it. So no matter politics or shutdowns, take on your own situation and know we remain here to help you do so.

Wednesday, January 2, 2019


We have made it through the holidays.   Here is to hoping that they reinvigorated you and have you set to take on 2019.
Around here, that means getting ready to take on the first tax season under the Tax Cuts and Jobs Act. Well, as long as the government still works when it is time to file …
Yes, that whole government shutdown thing must be addressed when a lot of what we are going to be concerned with over the first part of the year is submitting information (and money) to that government.
Currently, the IRS is being run with a number of critical employees to keep it functioning. As long as this shutdown endures, we will hear adjectives like “critical,” “necessary,” and “essential” being used when it comes to which employees are still working. Rest assured that the government will find the number of people needed to process and collect taxes essential, critical, and necessary.
Exactly when filing season begins and when the IRS begins processing returns could still be a little bit up in the air.  If the shutdown continues for a prolonged period, I would not be terribly surprised if the beginning of that period was pushed back a little bit. I would, however, be extremely surprised if that led to the end of the season changing. So however much time you thought you had to file your taxes, that’s going to be the amount of time that you have to file your taxes.
This could, however, result in refunds being delayed. The government is going to want you filing on time still, but if they have a reduced staff, they will not be able to get money back to taxpayers as quickly. The IRS’s shutdown plan actually includes those delays. If you are interested in exactly what the agency’s plan was in case of shutdown, you can view a complete report from last month here.
So typically the IRS gives refunds within 21 days of a return being filed, and a shutdown won’t mean that the government doesn’t give that money, just don’t make any financial plans that count on rapidly getting that money back, because we don’t know when it would be coming.
That feels like a lot of information in a short space. So let me try to close with a summary.
I do not have a crystal ball and do not want to guess at how long this shutdown lasts. What we do know, though, is that it means the IRS is currently working with decreased staff.
No matter how long the shutdown goes on for, the IRS is going to have enough staff to continue to accept and process tax returns whenever the filing season starts.
Therefore, do not put off getting ready for that season. January is here and that means that you’re going to start receiving some of your tax forms. The quicker you put them together, the less stress you are going to feel as we move through the next few months.
And yes, it may not be fun to have to wait for a refund if a shutdown progresses to that point, but do no put off preparation and filing because of it. That would just add to the stress.
And another way to help ease those potential strains is to make a tax prep appointment now so we can start getting you ready for your return and have a lot of time to make the new rules work best for you.