Another episode of the Dr. Friday Radio Show! In this episode, host John Haggard talks with Dr. Friday about all the updates on taxes and the following topics:
- New Tax Filing Deadline Is May 17, 2021
- First Quarterly Taxes and Other State Taxes Due April 15, 2021
- “I Haven’t Filed Taxes In Years. Why Did I Receive My Stimulus Checks?”
- What Qualifies For a 179 Deduction?
- “Under What Conditions Does a Driver Qualify as an Independent Contractor?”
- Tax Extention Date Will Be Extended
- If You Didn’t Recieve Stimulus 1 or 2, You Can Claim Them On 2020 Tax Return
- Do You Need Help With Tax Representation? Call Dr. Friday
and answers other caller’s questions!
No, no, no, she’s not a medical doctor, but she can sure cure your tax problems or your financial woes. She’s the how-to girl. It’s the Dr. Friday show. If you have a question for Dr. Friday, call her now at 615-737-9986. So here’s your host, financial counselor, and tax consultant, Dr. Friday.
John Haggard 0:30
Live from America’s Music City, it may be Saturday where you are but it’s Friday, all day, every day, all the time with the tax doctor, the tax lady, the doctor of accounting known in these parts of America as Dr.Friday. Right here she is. Hello, Dr. Friday.
Dr. Friday 0:47
Hello, John. What an intro. I always love when you host my show. You’re so enthusiastic about my name.
John Haggard 0:53
Well, we’ve had such a fun time, and boy, do we need you more than ever? What’s getting ready to come up here a lot of activity they’ve extended. You know the tax filing deadline. Is there any breaking news doctor Friday, anything that you’re hearing on the inside about what might happen with the tax code for 2021? Does anybody have an idea?
Dr. Friday 1:15
I don’t think anyone has a good idea. But I did want to jump in because I know they extended obviously till May 17, the 2020 tax filing. But they did not extend making your estimated tax payments for 2021. It was due on the 15th. So a lot of people did not realize they thought everything got extended. Also business license, franchise excise tax, anything that had a deadline pretty much for April 15. On the state side, many of those did not get extended. So you want to be very careful about thinking that you made things on time. If you haven’t filed your first quarterly for example, John, you’re self-employed, I’m assuming, like myself, and so we have to pay those. Those were due on the 15th. They did not extend them out to May 17.
John Haggard 2:04
Well, folks, now did you hear that? Because most people or a lot of people would have thought, well, “I’ve got until May!” Well, no you don’t. Based on what Dr. Friday said. You know what’s interesting, the government always wants their money on time. They’ll take the paperwork a little bit later.
Dr. Friday 2:23
Correct. They want their money early, not late. They definitely, I think it’s a great way to explain, anything we do most of the time, from the tax standpoint, we’re really just following up with paperwork. They want people to be paying their taxes on a monthly or quarterly basis.
John Haggard 2:37
Early and often. Right?
Dr. Friday 2:41
John Haggard 2:42
Folks, you’re listening to the Dr. Friday show. Every single week someone will be tuning across the dial or on the internet or something. So what is this? What are you listening to? Well, this is an advice show and not only advice, but you can actually get work done and get a consultation done with Dr. Friday. I mean there are a lot of people out there that do that type of work. Now there’s one thing you might not know about Dr. Friday, especially if you’re a new listener, and you’re here for the very first time, so you want to listen to this.
John Haggard 3:13
Dr. Friday is an enrolled agent with the Internal Revenue Service. No, she does not work for the IRS. If you were going into a court of law and needed an attorney to speak on your behalf because you didn’t want to testify or talk to the IRS ever again. She can do that for you. She is your representative. She works for you, not the IRS. You know, I looked up an enrolled agent. And if I got this wrong, Dr. Friday, correct me. An enrolled agent likes Dr. Friday, which is a federally-authorized tax practitioner who has technical expertise in the field of taxation, who is empowered by the US Department of Treasury to represent taxpayers before all administrative levels of the IRS for audits, collections, and appeals. Did I get it right?
Dr. Friday 4:06
Right. You are good. Very good.
John Haggard 4:08
All right. So people say “Well, okay, so what?” I like to brag on Dr. Friday when we get the opportunity to be on the air because she doesn’t brag on herself. But I’m going to. Here’s an actual live case, and I can’t give you a name. And of course, everybody’s case is different, and some people may not be able to get anything done because of whatever their situation is. But she did have a situation a few years back there was a person who owed to get a hold of this, folks, this is not a typo and not a mistake. Over one million dollars, and through all the negotiations working with the IRS. You got that down to about $100,000. Am I right about that?
Dr. Friday 4:47
John Haggard 4:49
You know, people say, “Well, that just sounds too good to be true.” How do you do that?
Dr. Friday 4:55
Well, I think your caveat, in the beginning, is it’s different for every individual. In this particular case, first, he wasn’t in compliance, which meant that the IRS had done a great favor for him. They just filed taxes based on no information, basically no expenses, and he’s self-employed. So they had him assessed for taxes that he didn’t actually owe. So filing your taxes could save you a lot of headaches. Then, obviously, depending on your assets, everybody has different situations. How much money do you have in the bank? Are you married? How much do you guys earn together? How many children? All these come into play. Do you have a 401k? Do you have equity in a house? A lot of times you’ll hear on the news, it’s always all if you owe more than $10,000, we can help you settle with the IRS for pennies on the dollar. Not always true. I mean, sure, I can tell you some wonderful situations as low as $25, where somebody owed $75,000. But in all reality, those individuals also had very little to their name, they were at a perfect time, where they were at the lowest of their situation. They were renting, they didn’t have any assets, they didn’t have any equity, they didn’t have anything, and the IRS can’t go against something that they don’t have. So, a lot of times, unfortunately, people come in after they’ve gotten back on their feet. That’s not the time you really want to deal with an IRS issue. You want to deal with an IRS issue when you’re really trying to deal with all the other hard things in your life. Because that’s the time you might be able to make the deal that will maybe get them off your back and give you a fresh start.
John Haggard 6:29
Alright folks, now if you have a question, something that’s been bugging you, or maybe somebody said, “Well, this is what you need to do to handle this tax situation, or this is how you need to put this on your own return.” If you’re doing your own returns, now is the time to call. We’re here live. When we say live, that means call in now and get the answers to your questions. We’re only here until three o’clock. So t-minus 50 minutes time flies when you’re having fun. Here’s the phone number to call. By the way, some people are a little bit shy about that. Or some people say “Well, I don’t want the IRS to recognize my voice.” Put a sock over the phone and disguise your voice, if you’re worried about it. Call this number but do it now at 615-737-9986 for Dr. Friday an enrolled agent with the Internal Revenue Service. She can get it done for you. Call now and get that free advice. We’ll also give you some other contact information if you don’t get a chance to get on to the Dr. Friday show.
John Haggard 7:28
One of the big questions Dr. Friday that that comes about for your program. If you’re self-employed, they’re always changing these rules about this thing they call section 179. If you’re self-employed, and certain things work the right way. If you buy X amount of equipment, say it’s you know, $100,000 worth and you say your gross income was say, $200,000? Would you just pay tax on 100,000? Or how does that go? Because a lot of people want to know about that.
Dr. Friday 8:02
Right. So basically what’s great is, well, first thing is, so it’s up to $500,000. So let’s say you did buy yourself a piece of equipment that was necessary first in your job. So a lot of people go out and buy cars, for example, John, and they say, “Oh, I should bill right off that car 100% in the year I buy it.” Not necessarily. If your truck is necessary, a big 2500 or a 3500 gram or something that’s big vehicle over 6000 total weight, you may be able to do it if you have that vehicle solely for work. But then you have to also determine. So I spend 100,000 and let’s say your tax bracket is 25% just for simple math. So you’re going to save $25,000 on $100,000 spent. It’s based on your tax bracket. If you spend 100,000, it’s not like you’re going to reduce your taxes by 100,000. You’re going to reduce your gross revenue by 100. But then your tax rate is what really is what you’re saving if that makes sense. So going on just buying things I have a lot of people call it the last two weeks of December saying, “Oh, should I go buy this or that?” never a good idea as far as I’m concerned unless it’s a necessary piece of equipment. And you’re going to make more money by having that piece of equipment because if I’m going to spend 10,000 and only save 2500 in taxes, it’s not necessarily a good investment for the purpose of just lowering tax bills.
John Haggard 9:28
Gotcha. All right, folks, the phone number 615-737-9986 for Dr. Friday the enrolled agent with the Internal Revenue Service. No, she doesn’t work for the IRS. She’s like an attorney, a lawyer she can represent you if you’re in some trouble. How many people do you find Dr. Friday, you know, over the course of 2-5 years that you know kind of gave up on paying in taxes and said, “I’m so far behind now? I mean, doesn’t matter if they almost throw me to jail no way I could pay for all this.” What do you find out there?
Dr. Friday 10:03
Well, I find a lot of people normally it’s a life that happens to be honest, John. Normally what it is, is that when you go through a divorce, or something pretty bad happens in life. And you know, the IRS kind of lets people slide for a year or two. They’re not gonna say sitting on your front porch saying you need to pay me but bill collectors, credit card companies. You know, you can get in a little too far a little upset. So those people kind of get into a place where they haven’t been told. And if they’re moving around a lot changing jobs, the government hasn’t caught them in all honesty. So they’re sitting there and then they finally want to settle down, buy a house, get married, kids want to go to college. These are all huge things. And guess what, you have to have tax returns to do those things. Or you don’t want to take this burden into a marriage. Why would you want to take on, you know, $100,000 of IRS debt into a brand new relationship? So you need to resolve or deal with these issues before you do some of those things. But I mean, honestly, I probably see two to five people a week that have IRS issues, and a large number of them are people that have been filed for 5-15 years.
John Haggard 11:17
Wow, that’s great advice there. Let’s bring Bill on to the Dr. Friday show. Bill, you’re on the air. Go ahead there a bill that I have you or did we lose? Maybe some technical issues there. One more here for you, Dr. Friday while we try to get those books because one says “I got a letter from the IRS, and I don’t know why.” That’s Bill. All right. We don’t have a bill. All right. So why if somebody did get a letter, the IRS just comes up with this number and says you owe money. Do they tell you why you owe that or is it just always the kind of letter that says you owe money, you better call?
Dr. Friday 12:01
Well, yeah, there are two different types. To be honest with you. There are times where this is a second letter. And a lot of times people say I’ve never received the first one. And then the second letter, it really just says, “Here’s your balance. And here’s the additional penalties and interest.” So not really a lot of information there. And there’s a lot of letters coming out right now where the IRS is trying to make sure people’s identity is correct. There’s a letter that comes out basically says, “You need to call us to prove your identity. I had to do this and I’m fingerprinted by the IRS. They weren’t sure what was happening. So a lot of times there are issues out there. But he’s gotten a letter it’s probably a second letter or the letter basically says you filed late and here’s the penalties and interest there’s not a lot of explanation. Don’t just jump to filing or paying an IRS notice and I know how frustrating guys I make a living out of trying to call the IRS but it really is essential to either certify or deal with the issue before you just immediately pay just because you’re afraid to deal with the IRS. Sometimes it’s smarter to you know to take the time to make sure that communication is correct than just paying a bill and hoping that they resolve the issue.
John Haggard 13:23
Alright folks you’re listening to the Dr. Friday show we are live from Nashville meaning t-minus 44 minutes to go. If you’ve got a question want to get on the air want to get an answer we want to get it to you Dr. Friday the tax lady here for you at 615-737-9986. John Haggard in the broadcast studio with Dr. Friday we’ll be taking your phone calls next in all live.
John Haggard 13:47
We are back live with the Dr. Friday show, segment number two, and back to the phone lines. I think we’ve got Bill who’s got an IRS question bill you on the air with us. What do you get? Is this Jodey?
I didn’t answer before because my name isnt Bill. Last year we took an extension because of COVID. That was in March before they extended the time to file. So we filed the paper on October 8th and I have a certified mail to prove that. We have not received a substantial refund. Is it reasonable to expect that we would get a refund if we filed on October 8th by now?
Dr. Friday 15:15
Well, it’s reasonable, but with the fact that the IRS has a ton of mail and they’ve asked most people to refile, I would say that you really need to refile your 2019 tax return. They closed down and somehow that messed up the mailroom, and we have found refiling those paper forms is the only way we’ve gotten communication. So I would say you need to refile for all right.
My tax preparer has retired, and I haven’t gotten any help trying to find out about this refund. So did I understand your number correctly? 615-367-0819?
Dr. Friday 16:05
All right. It has really concerned us. We don’t want to file this year until last year’s, and we get our money back because it was $5,000. All right. Now, let me ask you this question. There was an extension this year to May 17th. Is there an extension to file the automatic or is the time to file an automatic extension?
Dr. Friday 16:54
Yes, ma’am. The extension needs to be filed before May 17. Yes, ma’am.
I’m going to file that, and then I’m going to get in touch with your office.
Dr. Friday 17:05
Perfect. And we’ll help you out. Okay?
Thank you so much.
John Haggard 17:10
Good luck on that. Now let’s see if we can bring Bill on to the Dr. Friday show.
John Haggard 17:19
Let’s see if we have Bill. All right. Well, so here’s one of the questions that a lot of people do ask, especially for someone who is very last-minute Dr. Friday, and they say well, “I know she’s busy. We’ll go get me some of that preparation software that I can buy in the big box stores or online or whatever.” Would you recommend that? I mean, is it trustworthy? What if you run into a problem? Is there advice they can give? What is the deal on that? Should you trust it to begin with?
Dr. Friday 17:52
Right? Well, I think you have to do a little trust. Yes, I think it depends on the type of tax return you’re doing, to be honest with you. If you’re just doing a W2, I wouldn’t even buy the software. I go. I mean, if you were a computer person, I would go right on to irs.gov and then click on “file taxes,” and they’ve got online systems that are as trustworthy. I know, I’ve heard people say they use things like Credit Karma and a couple of those different ones to file their W2’s. I guess, you know, the fact is I’m not an IT expert, I wouldn’t suggest going to Starbucks and file your taxes online or something because I understand that can put it more a little bit more at risk. But I think if you’re just a basic w two individual, there’s no reason you can’t file your taxes in the simplest manner as possible. If you’ve got rental properties, small businesses, if you’re got K-1’s or multiple investments Schedule D’s, that may be a little bit more tricky, because if you don’t file those properly, you can either leave money on the table and give Uncle Sam a little bit of a raise, or you could under-report things. I had a couple of cases where people didn’t understand what QBI was and they did it incorrectly and ended up with the IRS changing tax returns and then reviewing tax returns because of it. So you know you just need to be a little bit if again, if it’s a small tax return with a W2 you and your wife that’s all you have and nowadays itemizing almost impossible for at least a number of people then I would say there’s no problem in filing your tax returns.
John Haggard 19:28
Alright, simple enough. I think we may have another Jodie? Is that right? Okay, Jodie, you are on the air with Dr. Friday.
So I left my job, May of 2020 and I was under the income. So when the government health care signed up for it. Of course, I did go back into it and took myself out. But for some reason, it never took me out. But anyway…
John Haggard 20:11
Jodie, you still there? Folks, sometimes technology just kicks us all around.
Dr. Friday 20:16
I’m gonna guess that she if she comes back, but I’m gonna guess what she’s gonna say is at the end of the year, she has a form 1095 A, and she may have ended up with a penalty because she went back to work, and they didn’t turn her off. To be quite honest, there’s not a whole bunch you can do, they are working with some changes to that were last year, they were going to eliminate some of the payback for people that may have gotten into that situation on the 2020 tax return. Jodie, if you’re still listening, you can call my office on Monday, and John will give the number out again, and I’ll be more than glad to review that with you if that’s the direction that your question was going. I may be reading in between the lines there, but we lost her. So that was my guest, John.
John Haggard 21:06
Alright, that sounds good to me. If you’d like to email, email@example.com. An email we got from Brenda says, “Love listening to your radio program, hope you can answer me on this one. A logistics broker that I know recently hired me temporarily to train a new driver for her. After this time, we talked about me continuing to occasionally do trips for her and she wants to pay me with an I99, and I be responsible for my own taxes. Under what conditions does a driver qualify as an independent contractor? I just don’t want to get into trouble or should she be paying the taxes?”
Dr. Friday 21:55
That’s a great question. So the IRS has a very specific rule. The bottom line is and a lot of people may not be following it. But if you are a subcontractor, 1099 employee, as a driver, you should be basically choosing your own hauls, driving your own vehicles. So basically, all you’re using is somebody that is saying, “Hey, we’ve got a car over here that they want to be hauled to this place over here, while you take that load.” You say yes or no, you take your vehicle over there, you haul the car, and you’re a subcontractor. If you’re getting in someone else’s truck, and they’re saying, “You’re going to drive for me from 8-5, or you’re going to make this run every day,” whatever it might be, that is an employee. That is you’re telling them when, where, and how. Those in the three major questions. As an employee, that’s perfect. That means W2, you take out expenses, if otherwise, that person can choose when to choose how and choose the time, the date, or anything else. So, I would say in her case, it sounds like she was basically being provided a truck and showing this person how to drive to meet the criteria. I think she would probably be an employee, john, in my opinion. The government has a lot of people that should be employees but aren’t. So just be careful. As business owners, we can be penalized. Pretty steeply for treating people as subcontractors. When they’re not legally subcontractors,
John Haggard 23:29
Did you hear that? I mean, this is a place you get the advice because it’s not that you’re going to pay them back taxes, they’re going to get you. By the way, this one from the mailbag as well, Dr. Friday, and this one from Amy, she says, “I’ve got five years of back taxes for a small individually owned business. Can you give me any idea what that might cost for you to do all that?”
Dr. Friday 23:53
Yes. I mean, the idea will be this, we can do a basic Schedule C. When you say small business, assuming it is a single sole proprietorship 1040, Schedule C, you’re providing all the documentation that can be as low as three to $400 per a year. But if you need help accumulating that information, because sometimes that’s the problem is you don’t know where to start. That means we have to go back, we have to reconcile bank accounts, get bank information that could cost you $150 a month for us to actually go back and create the financial statement required for us to do a tax return. We offer all those services. It’s not an easy answer, John, because if this person is organized, they probably would have filed their taxes on time. But if they’re willing to do the legwork, put together all the information, and create the basic financials isn’t too bad. As far as my opinion. So you’d be looking to three to $400 per year for the next 4-5 years, depending on the number of years that need to be completed for that person.
John Haggard 25:02
Alright, it’s not terminal. I mean don’t give up. Dr. Friday is your lifeline to get that work done. So as we look at the clock, t-minus 29 minutes to go. If you’ve been holding on the phone or need to get on the air need to get a question answered you know what? Now is the time to call because in 29 minutes were gone. Call 615-737-9986. When we say live, that means we are so-called now. John Haggard in the broadcast studio along with an enrolled agent with the Internal Revenue Service. No, she does not work for the IRS. Enrolled Agent means she works for you. Much like an attorney would if you were in a court of law and needed to have representation so you never have to talk to the IRS again if you don’t want to. We’re taking your phone calls.
John Haggard 26:04
Dr. Friday, It’s the tax show. If you have just joined us, folks, for the very first time ever, and you’re wondering what’s going on? This is the number to call to get all the free tax advice you could possibly want on the air with Dr. Friday, who is an enrolled agent with the Internal Revenue Service. I want to clarify that Enrolled Agent does not mean works for. No, she works for you. Let me just give you the official definition of Enrolled Agent because some people, “I don’t want anyone from the IRS talking to me.” Okay, so an enrolled agent is a federally-authorized tax practitioner. Okay, that’s Dr. Friday with technical expertise in the field of taxation empowered by the US Department of Treasury to represent taxpayers, before all administrative levels of the IRS. Audits, collections, and appeals. Again, like an attorney who represents you in a court of law. Let me prove to you why that is valuable.
John Haggard 27:01
If you were with us at the beginning of the show, I told you that Dr. Friday had a client that owed over $1 million. Can you imagine going to sleep at night knowing you owed a million dollars to the Internal Revenue Service? I couldn’t imagine I don’t think I would ever sleep. She got that case negotiated that down to around $100,000. She’s had others like the person owed 100,000, I think he got that went down to maybe four or 5000. Every case is different. There’s no guarantee, don’t believe anything on the air when people say you know, like Dr. Friday said, “If you have more than $10,000 in taxes” and all this stuff, you just got to be very, very, very careful. Again, it does sound too good to be true. For those who missed our segment, their doctor Friday, the one who went from a million to 100,000. And the one who owed 100,000 to 4,000 and all these types of things. Again, what is it that you do?
Dr. Friday 27:52
It does. Again, what we do is we basically and what the IRS requires us to do is to look at your current financial situation where you are today because a lot of times people will come in my office and they’ll say, “I can’t afford to pay the government what they’re asking, I can’t afford it.” But your version of affording it may be maybe you like to go to Starbucks and you spend a lot of money for miscellaneous things or your mortgage is $4,000 a month, believe it or not, the IRS considers that excessive. So there are things that you would have to make, you might be able to make a partial payment plan and have to change things that the government saying, “If you can afford us,” well, I have to have a house I have. But they say you can live in a certain type of home a certain value of a house if it’s above that. They’re saying you’re using our money to buy that house, right? I mean, if you’re putting money right now in a 401k, but yet you owe the IRS, that doesn’t make sense. That money you’re saving for your retirement is real money that should be going to the IRS. I mean, you don’t have the extra money, you’re using their money to invest it. So first we have to go through and figure out where you are, how much money you have access to, and where your money’s at. Then in some cases, you know, life has not always been fair, and you may have been self-employed, and you ended up not being able to pay the government and you finally got a real job. Some of the self-employed people like to refer to it, and now you’re on the W2 but your income is way lower. You have the ability to negotiate, but you have to be honest about it. And that’s what our job is is to make sure that people understand exactly what the IRS expectation is and how we can get you to the problems you are today to a resolution at the end.
John Haggard 29:44
All right, back to the phone lines. We go Mike on the Dr. Friday show. Mike, you’re on the air.
Yes, I’m here. Hey Dr. Friday. Hey, got a question for you, and I’ll try to make this quick. as I can, so back in 2007, I and a buddy had a tile business, and it was a 1099 position and just being I was really young at the time. So being in that 1099 position, I never, I never paid the taxes on it. We only did it for that one year, and then I’ve worked just a real job since then. But in that 15 years, I think, am I right? About 15 years, 2017 ways, I haven’t thought of a tax return, not one time. I know, that sounds horrible. But I’m at a point in my life now, where things are going good and everything and my wife is on my butt about this. But I’ve had people say that you never know you need to, you know, do something about this, because you haven’t filed, you know, they may owe you money, versus you owe them money. And I just don’t see that I feel like I owe them my house, and what little land I have now.
Dr. Friday 30:55
The good news to that conversation is, is that the IRS has probably already assessed you. And it could actually have already fallen off, you’re talking 15 years ago, the IRS only has 10 years to collect. Now back then the laws were a little different in 2007. Now they have to do an assessment within about three years or you know, and once the assessment is done, they have 10 years from that assessment date. So first thing I would say is let’s look and see what you actually do have if anything. Second, I mean, there’s a lot of resolutions available to you. I mean, you have a job, you have a house, you had the ability. So you know, once you know what it is, I agree with them, you may have in the last 10 years or whatever, once you started to get a real job and got married and possibly had children, you may have left money on the table that would have been able to be used to pay but you can only go back three years for the purpose of collecting refunds. But, you know, you might as well sit down, you need to go back six years if it’s a matter that we want to get resolution. But, you know, we can look and see. I mean, it may just be that that year has already fallen off, you have nothing to worry about. You need to file for the last three years and get your money in your pocket. You haven’t even probably gotten any of the stimulus money if you qualify, because you haven’t filed those tax returns.
I’ve gotten every stimulus. I don’t know how, but I’ve got I have not filed a tax return in 15 years, and I’ve gotten every year.
Dr. Friday 32:25
Does your wife claim you on her tax return?
Dr. Friday 32:31
Okay, that is unusual. But you know what, I’m never shocked when it comes to the IRS. So, you know, I’m glad that you have to be honest. Oh, you went in as a non-filer?
Yes, ma’am. There was just there was information on there when the whole stimulus thing happened, you know, yeah, that’s what I said, I was like, “Oh, I’m not going to get one of these because I haven’t file my tax returns.” Just looking at it, I saw a little area for non-filers. And so I’ve just filled out what it asked me to fill out and every time there has been a stimulus, it’s actually hit my account a lot sooner than most people and so, and I feel blessed for that. That was my question is, you know, I’ve needed to call somebody about this, but I didn’t want to go to just a run-of-the-mill tax service. The one that my mom used for years shut down. So I just kind of want those things for I don’t know who to call or who to talk to about it.
Dr. Friday 33:32
I’ve got you now. Yeah. I don’t know what part of the country you’re in. As far as if you’re in the Nashville area or outside. I’m in Brentwood, but if it’s convenient, we can set up a time, and we can get power of attorney and figure out what we need to do.
Yeah, we live right outside of Murfreesboro, and I work at the GM plant in Spring Hill. So yeah, I’m not too far from here.
Dr. Friday 33:55
Nope. You’re not too bad. No worries. So yeah, you want just when you’re ready, just give me a holler.
All right, thank you so much.
John Haggard 34:04
Thanks, Mike. Good luck on that. See, folks. Dr. Friday, I mean, she really can help and a lot of people are like, “Oh, no, my situation is so bad.” That’s what she does. All right, this one from the email bag, which is firstname.lastname@example.org. This is from Alex and says, “I haven’t had taxable income for most of my life. The one time I did file taxes, it was taken by the Department of Treasury due to my father lying in order to keep receiving checks, he forged my signature. Now the Department of Treasury is making me pay it back. I started working again as an independent contractor, as of 2017. I’m not sure how I should go about filing them.”
Dr. Friday 34:50
Yeah, that’s a little different. Because whatever he signed on hers has obviously gotten her into some serious problems and now the question comes, there are steps she could take, but how far do you want to go with your father? Right? It is family, and I’m not gonna say I had the perfect answer. But personally speaking, I don’t think I want my dad in jail. So maybe there’s some resolution, you could work with your father. Again, not everyone was blessed to have a dad as I did. But if it’s a matter of she could actually bring it up in front of the Treasury and basically, find out what he had signed and prove that it was not him. Then they’ll take her off of it, and they could, you know, go against the father, or she can have resolution with her father. Whichever way I would say the answer is she needs to file and to just assume until the resolution comes up, they’re going to keep whatever her refund is. As soon as she gets paid off, the better I mean, that’s a little outside of our norm, most of the time are people that do know they owe tax dollars, they just haven’t been able to pay them for whatever reason.
John Haggard 35:59
Alright, simple enough on that. You’re listening to the Dr. Friday show and we are life getting ready to go into the final segment t-minus 14 minutes better jump on that phone. Now this will be your last chance most likely the phone number 615-737-9986. When we come back, we’ll talk to Ed, who lives in California I believe, sold his house and has a question for Dr. Friday. John Haggard in the broadcast studio with Dr. Friday taking your phone calls next and all live on Super Talk 997 WTN.
John Haggard 36:40
Alrighty, the final segment of Dr. Friday show live from America’s Music City. By the way, if you’re ever outside the listening area of this radio station, and you want to listen to Dr. Friday or any program on this radio station, just download that IHeart app on your smartphone. Search WWTN and there you go. All right, back to the phone lines. Let’s bring Ed on to the Dr. Friday show and what you got going on?
Yes, hello. Dr. Friday. I really enjoy your show. I had a question. My dad lives in California. He’s 90 years old. He’s on a pretty much fixed Social Security income. But he did sell his house this year in March. So I just wondered if there was any kind of I’m helping him do his taxes.
Dr. Friday 37:27
Is he married? Or is he single? At this age?
Dr. Friday 37:32
Okay, so he’ll have a $250,000 exclusion above whatever you originally paid for that house?
Okay, he had a reverse mortgage to do that. Does that matter at all?
Dr. Friday 37:51
No, it won’t.
Alright. Okay. So it’s just the basis of the house or, or the cost of the house. Is that California specific to Dr. Friday? Or is it that just in general? I’m sorry, I’m trying to ask you of state question.
Dr. Friday 38:12
No, you are perfectly fine. It’s my fault. So he had a reverse mortgage. Correct? So reverse mortgage, do you know how much he took out? Because he’s gonna have to pay back that reverse mortgage. But it doesn’t change the tax code. I just want to make sure I was clear on that. I wasn’t very clear. So I want to make sure it doesn’t change me. Reverse mortgages are nationwide. So it’s kind of like a mortgage. But for those that aren’t sure, he basically doesn’t have to make monthly payments. He gets some payment every month or a lump sum from his house when he signed up for that reverse mortgage. Right. I mean, it’s what he’s living off of maybe. Do you know how much originally paid roughly for the house? Do you have any idea? Just a ballpark?
I think it was around 600. And he sold it for about the same price.
Dr. Friday 39:08
Oh, okay. So the bottom line is there would be no taxes to be made? That’s an easy one. There’d be absolutely no taxes due. Did he have it pretty much paid down? Because the reverse mortgage company is going to take their share before he even gets any money at the end?
Yes. It was very close at the end. He just got a little bit. So his loan balance almost was what he got for the house.
Dr. Friday 39:38
yeah. So the positives for anybody will be that whatever his capital gains since it’s under 250,000, he will have no federal taxes. California Tax I can’t tell you I’m an absolute expert. They have a tendency not to follow federal law and one of the things. So there is a possibility he would have a capital gains tax to the state. Maybe. I’d say you might need to double-check that with a local California Tax person. I don’t know the tax law that well for California. I know that he’ll be fine on the Fed, there’ll be no tax due on the Fed because you didn’t make enough on the other side to actually worry about feeding the exclusion.
Okay, great. Thanks so much.
John Haggard 40:27
We appreciate the phone call. Let’s bring Monica on to the Dr. Friday show. Monica, you can speak to Dr. Friday right now.
Okay. Hi, thank you for taking my call. I have a question about the cost going cost in Tennessee of taxes being done for fairly straightforward taxes. I moved here from Kansas a little short time ago and my 2019 taxes were done by a wonderful CPA that did him for 13 years there. And we’re about $200 for them. I turned them into a local place and it was 395. Can you give me an I have my 2019 taxes open in front of me? If you can ask me any questions that would tell you why they’re that expensive? Or is that the billing rate in Tennessee?
Dr. Friday 41:15
Well, it is not. I mean, can I ask did you have a state income as well as a federal one? Because in Tennessee, we don’t normally have to do states are willing to share if you still had that.
No. I didn’t have to state income. I just had a regular income. I didn’t know if you were asking we do have state taxes in Kansas and I think here you don’t have a state tax. But I don’t know if that makes a difference. Right?
Dr. Friday 41:42
That’s what I was saying. Because in Kansas, you do have a state income. So your guy was doing actually a state and federal return for $200. In Tennessee, we don’t actually have a state income. I would say 395 for a basic what I would consider a basic 1040 or a Schedule A or Schedule B situation? You know, I would say in my firm does not exceed $150. So you know, I think it just depends on who you went to.
Can I send you a to my 2019, and you tell me an estimate of what it would be this year if I sent them to you?
Dr. Friday 42:21
Absolutely. You can email it. If you want to black out your social security information or cover it. Just so we don’t have to worry. I’ve never had a problem with my email but just saying you can email directly to email@example.com that comes directly into my system. And I’ll be more than glad to estimate the cost. Yes, ma’am.
Got it. Thank you so much.
John Haggard 42:42
I appreciate the phone call. Let’s bring Jim onto the Dr. Friday show. We’re just about out of time. So if you got a quick question, go for it. You’re on the air and here’s Dr. Friday for you.
All right, thank you. I’m a POA away from my mother here in Kentucky, and she’s on social security and she’s being sued. I was told that her so security is judgment proof. I’m wondering if the latest stimulus check would be the same? If it would be judgment-proof as far as the courts?
Dr. Friday 43:09
No, it would not be. That I can guarantee you. I have seen where depending on the person’s income, and I’m not an attorney. So if you got that from the attorney, they’ll know better than me, but I have people that have judgments against their social security. There are some people that can get judgments.
They make her pay the nursing home all but $40
Dr. Friday 43:35
Oh, okay. Well, you know, and that’s a question that we have not and we’ve been asked that not on this show as much as on NewsChannel 5 you know if individuals that are in nursing homes, can they keep the symbolist versus the Social Security, which goes apparently to their care. And we had one person that they were told specifically that any money that comes in, is going to be considered income for them to be able to use for their care. So again, I’m not a lawyer in any sense of the word. But that was what we were told from one of the nursing home organizations in Tennessee. With that, it all helps. I have no idea. Sorry.
I appreciate it. Thank you very much.
John Haggard 44:20
All right. Appreciate the phone call for another great hour with Dr. Friday. And I want to tell you some things folks, if you don’t know what about Dr. Friday, very important for you to know. You may have just joined us maybe the first time you’ve been on the radio, in terms of listening to Dr. Friday, who’s here every Saturday from 2 pm to 3 pm. Now she is an enrolled agent with the Internal Revenue Service. No, she does not work for the IRS. She works for you especially if you are in a lot of trouble and you haven’t filed your taxes for five or 10 years or maybe the IRS says you owe 500 grand or whatever it is you’ve heard us talk about how she’s able to do negotiate in many cases, not every case, but many cases. For one guy a million down to 100,000 and another person 100,000 down to about four or five. Every case different no guarantee. It may sound too good to be true to you and some of these radio offers you hear are too good to be true. So you know, call Dr. Friday, let me give you her personal phone number.
John Haggard 45:21
If you’re in one of those situations, and you’re kind of wondering, Well, you know, what about it? Call 615-367-0819 very simple like that. By the way, did you know that baptism cannot save you because if it could, you would be doing work? The baptism ritual to get saved and you cannot do work to get saved, even good works. Even $100 million won’t get you into heaven. The only way is to accept the free gift of salvation Jesus Christ. How do you do that? If you’re ready, you want a guaranteed ticket one a guaranteed seat into heaven? Real simple. You just say right now just say, “Jesus, I invite you into my heart. I proclaim you my Lord and Savior. Forgive me for all the things I’ve done wrong as stupid things in the way I’ve hurt people, the way I’ve hurt myself, and others.” If you’ve just done that, if you’ve just prayed that prayer, you now have eternal life in heaven. If you need prayer or know someone who does join me on the website at treasuretop.com.God willing, Dr. Friday. We’ll see you next week right here on Super Talk 997 WTN.