EP:64 Tax Refund Remorse

Rich for the Day

Tax Refund Remorse

After the much advertised delay in sending out refunds, it’s finally time.  In this week’s episode, the focus returns to that once a year so-called pay day that everyone gets all worked up about.  “The Tax Refund” Like a windfall, a breathe of fresh financial air.  Sometimes it’s spent in our minds 19 times before we even get it, just the idea of getting it. The tax refund is maybe one or two steps away from becoming a holiday, just so folks could have even more time to go spend some of that tax refund money.  The car dealers, creditors, retailers and anyone else that typically have slow January sales are all anxiously waiting as they know people are getting the refund checks.  Maybe there should at least be some slick moniker like “SupeR Black Friday” or maybe “GAAP Friday”.  Either way, there’s a lot of opportunity at this time of year for both making good moves or setting the stage for trouble during the rest of the tax year.

-Miles.

EP:55 Five Forces

Force Factors That Drive Small Business

5

In this episode, a review of Porter’s 5 Forces and how they shape small business.  Which forces may be working in your favor and which forces are working against you and your small business like the force of a hurricane.  In this overview a look at each of the five forces and how they may apply in most any small business.  At any given time or another one of these may be driving business to or away from you, in either case, it’s good stuff to know and good business sense to employ. It’s hard work

 

-Miles

 

EP52 Eric B. is President

Ep52 Eric B is President, and it obviously doesn’t matter.

Eric B for President.
Eric B for President.

In 1986 the song titled “Eric B. is President” was a #1 hit song in the Hip Hop community.  At the time it was a strange title, but the title sank in and it didn’t even matter.  The Hip Hop community went on to take over the music world and Rakim became one of the most well known and prolific rappers in Hip Hop history -still to this day.  He debuted by nominating his DJ for president, that’s 1986, talk about making America great again.

The 2016 election is over and a new president will be sitting in the White House soon.   There’s a lot of anxiety surrounding what is to become of the new presidency?  So the question remains, how will affect your daily finances, your money, your ability to save and invest because that’s all that really matters. In episode 52, what may or may not be of concern with a new presidency.

-Miles

Every Year is Election Year

Election Year is Every Year.

Every Dollar is a Vote!

What’s up with voting? What’s up with this current Presidential election? Usually the largest number of people turn out to vote in the general election, people seem to take it personal.  That’s a good thing, not so good is that once they’ve made their choice for president, they go back home and go to bed for more four years.  People miss out on all of the voting in between the four years, the voting for everything from local mayor, prosecutor, sheriff, the board of education to the city council and consequently all of the people that the foregoing hire or appoint while they are in office. Essentially, a mini administration.

 

Guess what that means? Ultimately, the local vote can be more meaningful to the quality of your everyday life in a far greater way than the once every four years presidential election.  But make no mistake about it, the BIG election does get all the attention.  Lest we forget, beyond the annual and biannual elections, use everything you do as an opportunity to vote. Every Year is Election Year.

-Miles.

Taxes, last minute free filing and HELP

Taxes, last minute free filing and HELP

Some last minute tax ideas, local help and information.

Ariva Taxes!
Ariva Taxes!

(Apologize for the audio, street side interview with some serious wind noise)

Just happen to come across a New York State Tax assistance trailer that is set up on the Grand Concourse in The Bronx, NYC.  State reps were out and a local financial services business, ARIVA was onsite to assist also, they were offering to assist anyone interested in getting their taxes done by the deadline for FREE!  Of course there were details, but free is FREE…

I stopped to talk with them about what the free promotion.  Although the state employees were a bit shy, they were very nice.  In connjuction with NYS was a local business, Ariva Tax and Ceasar from Ariva was approachable and glad to take a quick minute where he explained some of the services offered to the local community by Ariva Tax.

-Miles.

 

 

Right NOW: Filing Taxes

Right NOW Segment:

File Your Damn Taxes. Your Damn Self.

For most people filing your taxes is all about the money, so why would it make sense to give more of it away.  Filing your income taxes just isn’t the mystery it used to be.   If you’re like most people, you probably work a job, have taxes taken out and look to file your income taxes with the possibility of a refund. That “Refund”, as it turns out is super juicy.  So juicy that entire businesses, franchises and small companies have been built around said “Refund”.  Between the tax credits like Earned Income Tax, tax over payment from your check every pay period and under reporting of dependents, that “Refund” stacks up to a few thousand dollars very quickly.

Instead of waiting at the tax office until the late night hours to file with some local retail tax branch, letting them charge you anywhere from $100. up to $500. or even more you can save by handling this yourself.  If it’s all about the money, then be just that, “all about the money”.  Every year retail tax preparers come up with enticing schemes to get people in so they can get a piece of that “Refund”.  This year’s promise is dome money upfront, referral commissions and of course they offer quick turn around times… fast, fast, fast!

Filing taxes yourself have benefits that last starting with you understanding your finances and taking some control of handling them too.

Business Owner vs Buying a Job

Business Owner vs Buying a Job

Started a New Business, or Working for Yourself?

Typical to wear many hats as a small business owner
Typical to wear many hats as a small business owner

Are you a business owner or did you buy yourself a new job?

All too often we want to pick up and take our skills to market for ourselves to start a new business and make all of the money for ourselves.  We decide that we can do it, we can just do it all and leave our jobs to do just that.  Take the skill-set you have (doesn’t matter whether you’re a cook or an accountant it’s the same approach), add a little money and “BAM…” you’re in business for yourself.  No more reporting to that boss who isn’t half as smart as you are.  No more doing the work for everyone else to get the credit and the money.  Considering you are at the heart of the business, the heart of the productivity, basically you are the business right? Well, not so fast…  Before you go that leap into business first consider if you are taking a leap to go start and run a business or just to buy yourself a job, in which case you are simply “self employed” in the truest sense of the term.  Meaning you’ve secured yourself employment, about that business part …well being a business owner is actually something else entirely.  There are a few simple questions to ask yourself to get some clarity on it all too.  First question: Can the business run without you being there to produce or overseeing the production? Right there, that should help put it in perspective for you.  Today’s podcast talks about identifying the differences and transitioning into self employment, owning or running a business.

 

-Miles.

Give Yourself a Raise: FSA Open Enrollment

Give Yourself a Raise: FSA Open Enrollment

Money Saving Opportunity Ahead: Open Enrollment.

Save cash on dependent care costs using tax free income
Save cash on dependent care costs using tax free income

Making more of the money you have is the best way to give yourself a pay raise without asking for it from someone else.  While there are many ways to do this, some are right in plain sight.  Spending less and getting more is the obvious choice for savings and when you can quantify that in actual cash, it’s even better.  Let’s consider the reducing our taxable income by signing up for the FSA tax advantage, Flex Spending Accounts and Health Care Spending Accounts. Now is the time to consider it because during this time of year most employers are having employees sign up for next year’s benefits, known as “open enrollment”.  During this period you can select via FSA elections to have up to $2500.00 set aside from your pay for specific Healthcare and up to $5000.00 for dependent care related expenses.  This set aside is before tax thus reducing your taxable income by the amount you choose, up to the limit.

Although either limit may be a lot to consider setting aside for the year, you can choose any amount up to the limit and typically it is taken out in equal amounts per paycheck through the year.  The amount deducted may fluctuate as you make claims for reimbursements and so on.  So, can you afford to pay unnecessary taxes? That’s the real question.  You can boost your income by up to $2250.00 in savings on taxes should you go to the max on both.  That would be a pay raise with no more responsibility other than being more diligent with your money.

Help make ends meet by saving on healthcare costs
Help make ends meet by saving on healthcare costs

In this podcast I discuss some of the benefits and details, however, some FSA providers lay it out in very plain terms.  Check out Aetna FSA breakdown and explanation for a breakdown, and check out both the dependent care link as well as healthcare link.  Although you may have another provider, the tax benefit works the same regardless of the provider or employer facilitating it.  To get a good idea of the costs and expenses covered for healthcare and OTC, (over the counter) items check out https://fsastore.com/ they offer details on all eligible items that you can buy with tax free monies, you may find some surprises here.  Here’s the link to the official tax document detailing the rules and guidelines Tax rules and details  Why pay the tax on the income and then the tax on the goods too!  It’s all about the incremental things we do to make and manage our wealth.  This is a great tax benefit that I have used for years in a lot of creative ways, all legal of course!

2015 Tax Filing Deadline for Who?

2015 Tax Filing Deadline for Who?

Why the Tax Filing Deadline Doesn’t Apply to You.

Does the deadline apply to you?
Does the deadline apply to you?

For years it has been the unspoken conventional wisdom to make sure to file your taxes by April 15th every year. There has been a lot of news coverage and hype surrounding this issue of the tax filing deadline. At the height of the hype, news crews are out at the post office on April 15th interviewing filers, focusing on the postmark stamped on the envelopes and all sorts of other hyping madness. So what is it all April 15th filing deadline about? Why the hype about April 15th? Will you miss out on some benefit or face some negative consequence for filing after April 15th? Maybe, and for most “NO”.
The vast majority of people in the U.S. that will file taxes work some sort of job for a living. It just depends on what type of job, from there it moves up in sort of a pyramid shape with the regular employed folks at the base, then the self-employed, small business owners, investors, major business owners, the rich and so on. The higher up, the less people there are in any specific category until you reach the almighty 1%, and they have their tax own issues. Whether you work for a government entity or private company of any kind, it is still working and you will fill out a W4 where you classify your legal status for employment and exemption status. That document is used to determine how much taxes are to be withheld based on you salary level and exemptions you put down. By law, the employer must have you fill out this document, and withhold taxes from your pay/ compensation accordingly if you work full or part time directly for that employer. If you do not work full or part time directly for that employer then they must send you a form 1099 instead at the end of the year, this form will tell you how much the employer reported to the government that they paid to you, with or without taxes. This is typically for contract and task based types of work. Either way, you usually have the chance to elect exemptions and go from there.
At the end of the year and the beginning of the new year, the employer is required by law to send you a form W2 that details all monies paid and taxes withheld, that is the primary document the majority of workers will use to file their taxes. Although the profile of working taxpayers is very broad ranging from single person head of household to married with kids and so on, the majority of regular working people will have paid enough taxes or paid too much, especially once tax credits are added in. That will be the reason for a refund, once you fill in the 1040a or 1040ez whichever works for you, at the end it will let you know if you’ve overpaid by any amount and that will mean a refund is due. Conversely if you’ve underpaid, it’ll state that amount as well and that is what you will owe.
Now about this timeline, unless you are going to need to pay any money you owe you do not have to file by April 15th. This deadline applies to people that owe money and must pay or claim an extension to file or pay so they will not receive and extra penalty fee on top of what they already owe. That’s it. If you know you are not going to owe money because you are one of the millions of regular working class folks that typically get a refund of some sort every year, then the deadline doesn’t apply to you. If you want to you can file your taxes in August, October or whatever month you like, it won’t make a difference if you don’t owe any money. The only thing is you must file be the end of the year, however, even then if you don’t owe any money it may be of no consequence. Except that if you don’t file by the end of the year for the previous year, (by end of 2015 for 2014) the IRS will contact you asking you to file because they’ve received your employer’s info, and if you need your tax returns for anything like loans or something, you won’t have them on hand. It is primarily when you owe money to the IRS that timing is seriously everything.

Timing is everything when you OWE
Timing is everything when you OWE

So unless you’re under some pressure or just plain ol’ anxious to get back any refund due, and truth is most of us see tax refunds as bonus and surplus monies, then you can file at any time during the year. After all of the hype, all of the commercials, the tax prep advertisements and the sales targeted at people getting refunds you can file. You can file and get your refund electronically the same way you would have in the eye of the hype storm. Except now, you might think a little more clearly as to what to do with that bonus surplus, now that you have tax money and the retail feeding season is over.
What’s really crazy, how many people that aren’t aware of this and are swept up into the hype of a tax deadline that doesn’t apply to them. I remember years ago asking everyone at the job about the filing deadline and most had no clue. Once your financial situation becomes a little more complicated by investments, capital gains, real estate rentals, small business profits, inheritances, stock options, 401k loans, disbursements, small business investments, depreciation tables, donations, running charitable organizations and many other things that make taxes complicated, then it’s necessary to be on your game maybe even on a quarterly basis and you’ll definitely know it’s necessary. Until then, if you’re doing the typical work grind like most folk then you’re in pretty good shape and don’t have to let the hype steer your actions.

No deadline when your getting a refund
No deadline when your getting a refund

NON-Deadline reminders.
• You can file your taxes all year long with no penalty if you don’t owe
• You can download tax software and do it yourself all year long, it costs the same
• You can e-file your taxes before, on or after April 15th and get your refund the same way
• Tax preparers push the deadline for business reasons, although it doesn’t apply to most people
• Car dealers and the retail industry market special campaigns for tax season

Deadline reminders

  • It applies of you owe money as a pay by date or extension request deadline
  • The deadline does apply if you are going to use a part of the refund for an IRA contribution or top open an IRA

Remember to save a lil’ bit if you can or pay down some crazy interest debt.

-Miles.