Another episode of the Dr. Friday show is here! In this episode, Dr. Friday talks all about tax filing and the following questions:
- Will There Be A Second Stimulus Check Coming?
- It’s Not Too Late To Apply For The PPP Loan
- When The Federal Unemployment Ends
- Do You Need Help With QuickBooks?
- What To Do If You Haven’t Filed Your Taxes Yet
- Do You Need Help With Tax Representation
- Can I Call The IRS About My Stimulus Check?
and other caller’s questions!
Transcript
Announcer 0:01
No, no, no, she’s not a medical doctor, but she can share cure your 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.
Dr. Friday 0:30
Hey, good day. I’m Dr. Friday and the doctor is here live on the air. If you want to join the show you can at 615-737-9986. I realize we’ve made it through the big tax deadline of July the 15th. Sounds weird to actually say after 20 plus years of doing taxes. And then of course we were able to file extensions for many of you that may not have been able to file taxes, just as we would have done on April 15. Those extensions are good for individuals through October 15. So hopefully now, I just want to reiterate that that does not extend the money you owe. So if you didn’t file the taxes because you knew you didn’t have the money and right now you have no idea where you’re going to get the money from. Just be prepared that the money is charging penalties and interest on that money as it grows. There is a failure to pay but as long as you filed an extension, at least you won’t get the failure to file extension on top of everything else. I do want to just put out some good news for a few of you that are thinking about maybe doing some shopping, just don’t forget next weekend, Friday the 31st through Sunday, the second is our sales tax holiday. So there’s a lot of things that are exempt like clothing, but some apparel that is priced at more than $200 per an item. Those things are exempt, you don’t get sales tax holiday on those but anything that’s under the $200 per an item, those will actually get school supplies, obviously, computers, but there’s you know good things. So if you’re a small business owner and maybe you’ve been meaning to purchase a printer, something maybe this in this state, you know that can be 9.75 almost the 10% savings, just not having to file sales tax.
Dr. Friday 2:31
I will tell you again if you are a small business owner, there is some tax relief coming our way for TNTAP if you file your sales tax or your business license, franchise excise tax, all of those are filed liquor taxes, all on that account. Some businesses won’t be every business but there are some businesses that will qualify for eligibility through the Tennessee business Relief Program. Barbershops, beauty shops, nail salons, a lot of them that were been forced to close. People in the museum park or bowling alleys, gyms, fitnesses, restaurants, bars, hotels, theaters, agents of any athletes or independent artists, writers, performing artists. All of those are going to fit in. There is some additional relief that is available now. So my suggestion is if you’re in those criteria, or you want to know more about it, just go to Tennessee Department of Revenue, website or revenue.support.tn.gov. Alright, so if you want to join the show, you can 615-737-9986. A lot of talk on the news. In the areas of which we’re always listening to is there going to be a second stimulus?
Dr. Friday 3:49
It really does look like there is going to be a second stimulus. I cannot say at this time, when or how it’s going to be done. There’s a lot of discussions if it’s only going to hit a particular market. If it’s going to be just for certain people, I mean, some people are working some people, I had people come in from this first stimulus and said, “Hey, I didn’t need this money.” Sure anyone likes a $2400 check. But everyone knows, there’s also going to be a price that we’re going to have to pay at some point for all this money going out. Well, who’s going to get it who’s qualified? I do believe they could have done a better target market of this giving it across the board to everyone that made you know, 50 to 75, or 100,000 to 150-$200,000. I think there are some people that were fine without the stimulus. There were people a large number of people I’m sure that that stimulus made the difference in the surviving or not. So again, there it looks like there will be a second stimulus. Hopefully, many of you had received the PPP. If you haven’t, if you haven’t applied for the personal payroll Protection Program or the SBA disaster loans, those are still on. PPP is still good until August 8. So again, if you’ve got an issue and you want to be able to do something on that one, then you’d be able to do something when it comes to making sure that the PPP is available. That’s pretty easy to do, all you have to do is go right onto your bank website. I know blueline is one that’s doing it. So anyone that might have something along those lines. This was for anybody that has a Schedule C, or anyone that had employees, less than 500.
Dr. Friday 5:34
So again, I’m talking to all the small business owners, people that you know, are just making it surviving. There was a large number of them that sit there and said to me, you know, hey, Friday, I don’t think I’m gonna need it right now. Well, you know, right now may be different than it was back in April when we were doing the first rounds and so PPP is still out there. And if you haven’t, and you think that you might need it, it is forgivable if it’s done right. I would be curious to find out if anyone has actually gone through the forgiveness, if you want to talk to about on the radio, if not, even after the show, it would be great to know, we have about 200 clients that did apply and receive some funds. And we’re just starting that forgiveness program now. So just curious if it’s already been through and people have successfully received forgiveness on most of the money, if not all of it, that was used on that. So if you want to do something along those lines, not an issue. All you have to do is you know, just curiosity. But remember that there are forms and documentation, you’re going to have to justify the spinning of it. Otherwise, it’s really a 1% loan for the next five years, which may be perfectly fine with many people. At least it kept your doors open and kept your roof over your head and the employees employed. So this is the kind of thing we’re looking at right now.
Dr. Friday 6:49
What are we going to do to keep businesses open small businesses is a heartbeat of America. It is the largest employer outside of the government. So you need to find out what are we going to do to keep these small businesses. I know many people, and I think it’s been appreciated, a lot of people have continued to use small businesses going out to lunch or dinner, getting food to go to small restaurants. But you know, obviously, versus sit down and all that they’re not making the same kind of money they were making prior to this. So we have to figure out now getting ready to go to school. I do not have children, so I can’t get in on that conversation. But I can tell you that small business owners are working twice as hard to try to keep their businesses and their lifestyle together so that they can continue to do what they need to do. So if you’ve got questions, if you’re a small business owner, or maybe you’re thinking about opening up a business at this time, you’re like, “What do I need to do to make sure this works or how do I go forward to do this?” Not a problem. But you can either give me a call on the radio right now. 615-737-9986. We can take your call, make sure that we know what’s happening and how it’s going to move. But if you don’t, that’s cool too. I know it’s a hot Saturday, I went downtown Franklin this morning and it was busy already, but boy is it hot outside. Staying inside seems like a really good idea.
Dr. Friday 8:20
I do want to mention to any of the listeners that might be over the age of 70 and a half, and you are taking your required minimum distributions. You don’t have to take it for the year 2020. In fact, you can return that money. And one of the questions I had someone sent me and says, “How do they treat the withholdings from the RMD is that going to also be refunded?” I believe basically when we file the 2020 taxes that will become a refund to you and you will get it back at that time. It will not go back into your retirement. In my opinion, it says there’s no income in It’s going to basically become a negative situation, but you will have to return 100% of what came out. Otherwise, if you only return the amount, after taxes, you’re going to pay tax on that amount and then get the refund of whatever’s left. So just the point of interest if you have required minimum distributions, and an interesting fact for any of you that are 70 and a half, but meet the new criteria, which basically means that you start taking your RMDs at 72. Do you have the qualified charitable contribution that’s still in place? So it’s 70 and a half, you can start paying your charity out of your requirement on distributions that you’re not required to take talk about talking in a circle and confusing individuals. It’s a wonderful thing if you are 70 and a half and a lot of people are huge givers. I mean, I can’t say how wonderful my clients are about giving to the charities in town. If you do that, if you can do it through your requirement on distributions is basically zero tax and right now under the new itemizing, it’s very hard for someone to meet the itemizing unless you give an awful lot or have a large mortgage or property taxes, but something to talk to your financial planner about, or your custodian that’s over your IRAs or 4013, B’s or your 401, KS, any of those that you are going to start having to take money out of thinking about the qualified charitable deduction because it is still awesome. Now I understand that even though the law changed the 72 for the RMDs required minimum distributions, the qualified charitable deduction is in place still at 70 and a half. So again, cool way of making that work for us and what we need to do to make that come together for us and make sure everything is working well.
Dr. Friday 10:43
Alright, if you want to join the show again, 615-737-9986. For all of you that have never heard of me, maybe you just hit the radio on Dr. Friday. I’m an enrolled agent licensed with the Internal Revenue Service to do taxes and representations. So If you haven’t filed taxes, or maybe you have filed, but you have a large amount of money due, and right this time you’re sitting there going, there is no possible way I’ll ever be able to pay the IRS off. You know, there are things we have to do, there will be steps that have to be taken to make sure that you can move forward and maybe make a deal with the IRS. I am not like a lot of those ads that you actually see that basically say, “Oh, we can make a deal with you give us a call. If you owe more than $10,000 we can help you.” You know what the fact is, every individual is different. In some cases, people are good to go to some people they’re not. So it’s just it really depends on your assets, your income, what situation you have, and where you’re at as far as making everything work in your favor. We always want to make sure that we have the ability to do that and give you the right answer. So you’re not just paying money out there and making it go, Oh, yes, whatever. Alright, so why don’t we take a quick break. That way you can get to your phone call and I don’t have to make you stop in the middle of that. This is the Dr. Friday show and we’re gonna be right back.
Dr. Friday 12:13
All righty, we are back live here in the studio. If you want to join the show today, you can call at 615-737-9986. And why don’t we go ahead and hit Thomas from Murfreesboro?
Caller 12:34
[Inaudible] here for a local manufacturer and I made about in the 90,000 range for income for my tax return that I filed in February. I’m unemployed right now and I’m looking for that stimulus money that Congress authorized back in the spring, and I’m estimating that I should get about a $300 check, but I haven’t received it yet. I’ve gone to the IRS website and get my payment and there’s no information. So my question is for I guess middle to higher income. When is that stimulus money going to be updated and received? And when will the IRS website be updated with current information because there’s nothing on the website.
Dr. Friday 13:29
So Thomas, did you say in 20? You filed 18th tax returns, right?
Caller 13:34
I filed a 19 tax return in February.
Dr. Friday 13:40
But did you file an 18 tax return?
Caller 13:43
Yes, I did.
Dr. Friday 13:44
Okay, was it still going to meet the criteria or did you make less money in 19 than you did in 18?
Caller 13:50
I made less money in 18 and more money in 19.
Dr. Friday 13:56
Okay. So which blows my theory right out of the water. So basically, they have already started issuing them. So for some reason, on the 18th, when they filed it, they didn’t see you as a potential meeting the criteria initially, because they used all the 18th for people that didn’t file 19 until later you filed your 19. They’re saying that the IRS website on their conferences, they’re telling us they’ll be issuing checks all the way up till September. Who knows, maybe they’ll be starting a new one at that point. Anyone that doesn’t receive it at that time will be receiving them when they file their 2020 tax returns. So my answer to you could be as bad as you may not see it, they may just basically assume that you’re going to take the credit in 2020. If for some reason something in the original criteria didn’t meet their expectations, and then you fall 19, which definitely does meet it. But I don’t know how far they’re going to go back through all of the 19 returns and see who did dent if they basically have you on. Unfortunately, I don’t qualify. So I did not receive one but most of my clients that did qualify have told me that they’ve received them. So I know there are millions of people in somebody’s listening that have not yet received them. Most people have received them. So I’m going to make the guests that yours should be coming in. I will tell you that website, Thomas was never useful as far as I was concerned. I’ve got people that are mailing tax returns because their kids went in and basically said they were nonfiler. So they thought they should go in there and go ahead and put their name which then made the kids filers and now the kids were not dependents. I mean, it’s just the website was not well thought out. So I’ve never been able to trust the information in there. There is a phone number though. Have you tried calling the 1-800 number for the IRS that set up just for the stimulus?
Caller 15:53
I have not, but I have gone to my local representative’s office and discussed it with the downtown office in Murfreesboro, so I have gone that route. The concern is would be, I guess one caveat. I used to live in Ohio. But now I live in Tennessee. So in 18, I lived in Ohio.
Dr. Friday 16:19
It’s possible that the check was mailed to the wrong address.
Caller 16:22
Oh, gosh, because I’m unemployed right now. I’m a veteran. So I’m looking for that money. I need that money.
Dr. Friday 16:29
I hear from you. Well, here’s an 800 number that is set up solely for the IRS and I have heard it be prepared. It could take you a little while but it’s 1-800-919-9835. If you’re driving or something just google IRS stimulus telephone number and that will come up for you. It’s 1-800-919-9835 give that number a call and you’ll speak with a live representative from the IRS and hopefully, they can then tell you because my concern in your situation might be that they did issue a check it went to the last known address would have been the one that was in your 18 tax return. At that point, it’s now been in essence returned back to them and they’re holding it waiting for an address change which they have received on your 19 tax return but who knows how quickly all of that’s going to be updated?
Caller 17:21
Okay, I gotcha. Thank you very much.
Dr. Friday 17:23
No worries, thanks for the phone call. Appreciate it. It’s a great call and to be honest, we already know that all of that is frustrating especially when you know there’s money out there that in essence your name is on and you cannot get to it or do anything with it. It’s frustrating and I get that. You were self-employed in 2019. I’m not too sure. At this moment. the only reason you’re not self-employed. I don’t know if you’re self-employed or if you were a W two. But if you were self-employed, there are some other avenues you might be able to collect. It sounds like maybe you’re not on unemployment don’t know for sure. Again if you have any questions Tennessee Department of Revenue Tennessee Department of Labor both of them have conversations on there about Unemployment benefits for the self-employed. I can’t tell, but 10s thousand It feels like but there’s probably 10s or even a hundred people I’ve talked to about being self-employed and getting Unemployment that did not work as smoothly as I think the Department of Labor would have liked. But it is working now and more and more of that is going. I don’t want to bring out one thing, nothing to do with that subject.
Dr. Friday 18:37
I am going to completely flip it over because you know so far but electric cars. I know I have a couple of clients that were wanting to buy something this year, but I do want to tell you Tesla GM no tax credits in 2020 available. They completely fell off by the end of 2019. So if you’re looking to buy an efficient electric car, the only one that still has some credit out there would be a Nissan. They haven’t quite reached the 200,000. But my understanding they are like right there on the edge. So if you’re looking to still get the 3750 credit originally at one point it was 7500. But most of them have already exceeded past the original numbers. Something to think about. If you’re you’re thinking of that if you’ve got other parts of the conversation, please give us a call here at 615-737-9986. We’ll take your calls, hopefully, answer your questions. Remember when you call in a lot of people are listening. Those questions are so important because many times people are thinking the questions and they’re like, “I don’t have the nerve.” I really don’t I’m not where I can or I don’t really feel comfortable talking on the radio. So I really appreciate all of you guys when you take the time to give me a call here in the studio and go for it. All right, let’s hit Paul real quick before the break. Hey Paul.
Caller 20:00
Hi, I had a question. With folks working from home, how is that right off? or How can that be a write-off? Let’s say my wife works from home exclusively, right? Often, and I work from home periodically, say, the government says to stay at home, if you can, how?
Dr. Friday 20:24
Yeah, that’s a great question. I’m asked that question a lot. And I will tell you under the current tax laws that changed as of January of 2018, there is no housing allowance for employees, there are no unreimbursed expenses available. So at this point that is just out of your own pocket, maybe I should say for the convenience of the employee, not always good as some people would say they’d rather not be working home but it’s for your own convenience at this time. There are no tax credits.
Caller 20:56
Interesting, okay. Because even if TurboTax asked that question?
Dr. Friday 21:01
I assume if they ask that if they ask the question, there’s no place for it to go. 2106 is for employees who came off the tax code as I said in 2018. So they may ask the question, it was an old question, but it’s not going to go anywhere on your tax return. I think we may have scared off Paul. Hello? All right. Well, why don’t we go ahead and hit Ed real quick? Let’s go see if Ed’s available for us. Hello, sweetheart. What can I do for you?
Caller 21:40
Good day Dr. Friday/ Well, I’ve got a question. I know a little bit. I’ve talked to you before, but I have inherited a couple of houses from my mother passed in about three years ago. And the question has come up very recently that whenever he passed if I sell the homes that everything reverts back to what it was worth to the day that she passed. And I guess my question is, is what’s my proof? What the place was actually worth on a given date in history?
Dr. Friday 22:16
Well, that’s a great question and the IRS would require that. So my opinion would be whoever actually handled the estate at the time should have gotten appraisals or at least something from a third party that would have said what it will be listed at or could sell at that time. If you don’t have it, I would suggest going to a good real estate agent and see if they can pull comps from that area around the date of your mother’s passing. So we would have proof that other homes like-kind similar or whatever would be similar to that and you can also hire appraisers that will go back and do that for you but documentation is what you need is something that shows other homes in that area were selling per square foot, whatever like this. Mom’s homes could have been obviously more, you know, maybe had to put some TLC into them afterward any money after that date and you had to do something if you had to fix them up or do something else, then that would be added to the original basis.
Caller 23:14
Okay, well, let me ask one other question because I’ve been living in one of those homes and I’ve been there for three years. If I stay there for five years, will that mean anything towards the sale?
Dr. Friday 23:27
Actually two out of five years, so theoretically, it would have been continuing your primary home. Is it the only property you own or you live in?
Caller 23:35
Ah, that’s not the only one I own, but it is the only one I live in. Yes.
Dr. Friday 23:40
Okay. So that’s the one you’ve been using on your tax returns and things?
Caller 23:44
Yes, ma’am.
Dr. Friday 23:45
Okay. So if it’s been the home that you’ve been using as your primary residence, two out of the last five years, you would have a built-in exclusion. Are you single or married?
Caller 23:54
I am single.
Dr. Friday 23:55
$250,000 built-in exclusion. So if you inherited it 50 and you sell it for 300 you pay no tax.
Caller 24:04
Okay. That helped me a lot that answers the question.
Dr. Friday 24:10
Thank you for calling. I appreciate you listening.
Caller 24:13
Thank you, Dr. Friday. Have a great day.
Dr. Friday 24:16
You’re welcome. All right, well, we take our next break and when we come back, we’ll take some more of your phone calls at 615-737-9986 take your calls, talk about my favorite subject taxes and money. We’ll be right back.
Dr. Friday 24:43
Alrighty, we are back live here on the radio, you have questions all you have to do is give us a call 615-737-9986 taking your calls, talking about all things especially about some of the things that are happening in small business, what we can do to try to keep more small businesses open, if you’ve got questions about dealing with the IRS because I do know sometimes one thinks, “Oh, this isn’t the perfect time and or whatever.” But dealing with the IRS, sometimes this is the best time to make sure that you’re able to move forward and get everything done while you have this extra time because lets be honest, extra time sometimes means you got time to start thinking about doing things as you want. Well, I know it’s not really a new year. We’re already into July, almost August. So we will be sneaking in here. It’s amazing that we’ve just finished a little bit over a month of finishing the second quarter of the year. I will tell you that this year was really unique guys, payroll taxes, all these things. We’ve got States under payroll taxes we have Social Security for the company that we’ve delayed. We have July 15th where we paid first second-quarter estimated payments along with paying our first which is usually due on April the 15th. The other two estimates are still scheduled like they’re supposed to be, which would be September, and then again in January, I realized this year is changed. I had some people that have been in the catering business and their sales have doubled. I’ve had some people that have been you know, the clothing industry and their sales have dropped by 50%. So, you know, your income and adjusting and we are supposed to make four equal payments based on the prior year as far as estimating is going.
Dr. Friday 26:38
So all we can do is our very, very best estimate to make sure if nothing else, we get 100% paid in of what you owe, and keep enough money in the bank so that you can still keep your bills paid and, you know, this year may or may not be the year that you want to look at buying new equipment doing different things because that is the way We do sometimes to lower the taxes, right? We need to look at all alternatives, what’re the best things to be doing? How is the best way for us to move forward? What are we supposed to do as far as lowering the tax bill as much as possible? At the same time, making sure that we’re able to do what we need to do and change what we need to change. So if you’ve got questions, maybe you’re in the midst of reorganizing your business and you’re not too sure. Should you change the entity? Should you be a corporation instead of a sole proprietorship or partnership instead of an LLC? What are the alternatives? What are your choices as far as what you need to be doing and how you’re going to move forward? All these choices that I’m talking about, you need to sit down and not only talk to an attorney is awesome, but you also need to have an attorney right up, you need to talk to a tax person as well because sometimes one can affect the other. So you need to make sure you’re hearing the whole story, both sides of it, and make the best choices you need to make.
Dr. Friday 27:56
Then you know exit plans. There’s a lot of people that are deciding if they should have Should not close their businesses. Well, if you’re thinking about closing your business, it’s not quite as simple as just closing the doors. Sometimes you’ve got more that you need to be doing. So again, we need to make sure that we’re looking at what is best and how we’re going to move it. So if you need help, again, I’m an enrolled agent licensed by the Internal Revenue Service to do taxes and representation that is what I do. So if you haven’t filed taxes, or you need help with making the deal. You filed everything but you don’t know how you’re gonna pay it, or you haven’t filed. I had a phone call from a revenue officer that called and said this person hasn’t filed, you know, sales tax for the last four months, because maybe their business stop, maybe your situation has changed. But if you need help dealing with Tennessee Department of Revenue, or the Internal Revenue Service, or even states, we deal with all the different states, I can help you and all you need to do is you can go to the website at Dr. friday.com and set up a tax appointment or you can just give me a call at our phone number in the office and I’ll give that out a little bit later. Just because sometimes it confuses people were to be calling. We’ll make sure that you can have an appointment come on in and see what you have going and where you need to be moving.
Dr. Friday 29:09
So if you’ve got questions, or you haven’t filed texts, and you’re sitting there going, “I’ve moved three times. I don’t know how to get my paperwork together, what am I supposed to do?” Trust me, we’ve been doing this for 20 plus years, we know how to help you obtain the paperwork indeed, help you work through preparing the taxes to the best of your abilities, and making sure that you’re taking the maximum that you’re entitled to, as well as getting them filed and then making and helping you either in a payment plan, non-collectible, or an offer and compromise and we’ll tell you the truth from the front. You don’t start making monthly payments and then later turn around and say, “Oh, we really couldn’t do anything or we’re still working on it keep paying us.” And six months later, or a year later you find out the tax returns hadn’t even been filed. I have had that situation going on and it can be extremely frustrating for everybody that’s around. So just saying as far as all the basic situations, you want to make sure that you’re able to get the best advice and what is really going to be best for you, not just a figment of someone’s imagination saying, “Oh, well, we can do this without even pulling your transcripts.” Does that make sense to any person with me? Doesn’t make sense to me. All right, let’s hit Brandi. Let’s see if we can get Brandi on before the break. Hey, Brandi.
Dr. Friday 30:41
I don’t know if you’re in a bad area. If there’s a chance you can either. I don’t know if you’re driving and maybe that’s why but we can’t hear you. All right. Brandi, if you can call us back. Unfortunately, on the radio, we can’t have good air too much because not here. I’m brand new out there. Or maybe you’re hearing Brandi and I’m not hearing her. All right, well, Brandi, if you could call back, that would be awesome. Love to have your phone call, but I couldn’t hear where you were saying. So if you have questions, you need help. You want to make sure that we’re doing what we need to do. Please follow up and again, the phone number here 615-737-9986 taking your calls, doing everything we can to help you there understand the situation, or if you’ve got a comment. Maybe you’ve been doing deals with the PPP or the unemployment, or you haven’t gotten your stimulus check. I know sometimes you just need someplace where you can start the conversation, you can call the show and we’d be more than glad to try to help you with that conversation.
Dr. Friday 31:42
Unfortunately, I have had some people that say call your local representatives, especially on the unemployment, I’ve had more than one that’s turned around and said they called them and then they found out that they were able to get some assistance or help and that would be totally awesome for everybody because just like the gentleman called earlier, in all honesty, guys, I realized it’s hard out there, it’s hard to figure out what you’re going to do, how you’re going to make it happen without the assistance of finances, it’s a little hard to pay the bills and make sure everything’s going to go through the way you want it to. So if you need help, we would be more than glad to help you get those and if you haven’t filed your taxes yet, and you’re trying to find a way of getting those filed, we can certainly help you with those. Now that it’s got a little bit quieter, we should be able to open up some more days and get some more taxes filed forever individuals or small business owners hopefully make it so that you can get the most that you can.
Dr. Friday 32:40
If you can’t pay your tax bill, we still need to file those taxes guys. Avoiding it is not going to help. What you do need to do, file them and then either explain the situation which you can to the IRS. “Hey, I’m unemployed. I don’t have any place to get the money.” Believe it or not, these are human beings now. Yes, they have criteria, a certain pecking order they have to go through. But if you’re unemployed, and there’s no money, the IRS can’t get money from no money. Or if you’re living solely off unemployment, which of course, my understanding is unless someone knows something different. I think federal unemployment is supposed to end on July 31. I have not read or seen anything come across my desk that says that that has been extended. If I am wrong, please. Again, if you don’t mind, call the radio show here or call me direct. I would love to know because I’ve got quite a few people that asked that question on an almost a daily basis, it seems like and I would hate to be wrong and tell people that they don’t, that the stimulus is still coming through for the point of unemployment, but if not, that’s great. As far as that situation again, if you have questions 615-737-9986 taking calls, hopefully being able to get some of your questions answered and move on past that. Let’s hit Duddy in Antioch. I need someone to chat. Hey buddy.
Caller 34:06
Hi Dr. Friday, nice to talk to you. Let me turn out. Alexa, turn off. I was listening to Alexa.
Dr. Friday 34:21
No problem. What can I do for you?
Caller 34:24
Okay, okay. Me and my wife married. We paid back almost 1000 miles this year to IRS. We paid in like 24,000. And I was wondering, how can I prevent normally I either get back $100 or I pay in a couple of hundred.
Dr. Friday 34:54
Perfect.
Caller 34:57
Trying to figure out how to file. We file married.
Dr. Friday 35:04
Right. And you probably did it correctly I’m gonna make a wild guess that what happened was either something this year happened a little different possibly had some sort of and this is a guess but I’m going to assume that some sort of change of income maybe you’d have to take out a little bit more from something or did someone retired with it? Was there some sort of change this year Bobby than your normal?
Caller 35:29
Not really. We made a couple of thousand dollars more but not that bad.
Dr. Friday 35:38
Yeah, well, unfortunately, that couple of thousand dollars more might’ve and this is just a guess but might have actually kicked you into a different tax bracket.
Caller 35:49
No, we stayed at 45%.
Dr. Friday 35:52
You did? Okay. Well, normally that’s what happens is, you know, if you owed 1000, and normally you only owe a couple of hundred dollars. So something changes because either didn’t pay in quite as much money as you did the year before, therefore didn’t have as much paid in as estimates or, or something changed as far as your total income. So, you know, I mean, there’s doesn’t take a genius on that one. If you need help, I could take a look at the two years or even the last three years and we can compare them and find out why we have such a difference and all them, but I’m going to make the guests that something has changed in the situation that makes it harder for you. That you’re not able to take whatever deduction that you’re usually taking. Okay, so it makes sense?
Caller 36:39
Yes. We did lose one because we lost our college [inaudible].
Dr. Friday 36:48
Okay. So even if your son was on your tax return at some point, it’s possible that was like 2500 In $500, any dependents worth $500 credit. So, Bobby, that could be just the difference between why yo 1000 instead of a couple hundred.
Caller 37:11
Okay.
Dr. Friday 37:12
So what you need to basically there? I don’t know if you are retired or are you working?
Caller 37:18
I’m working.
Dr. Friday 37:19
Okay. Someone might want to just have like an extra five or $10 coming out of a paycheck because your combined incomes probably kicking you into that more than one check situation. And that way at the end of the year, at least you’re not having to write a check for $1,000.
Caller 37:36
Well, fortunately, I had the money but I just hate to give it up.
Dr. Friday 37:42
I know, but it was a shocker to you, right? Because it was such a difference than your normal.
Caller 37:48
Thank, Dr. Friday. I listen to you every Saturday.
Dr. Friday 37:53
Well, thank you so much, Bobby. I appreciate it. All right. We’re gonna take another quick break here and we’ll get back we’ll take the rest of your phone call 615-737-9986. We’ll be right back.
Dr. Friday 38:20
We are back live here in the studio. If you’ve got questions, all you have to do is pick up the phone 615-737-9986 taking your calls talking about my favorite subject, which is taxes and money and I know tax season is kinda in the back burner right this second. People are sitting there going, “I’ve either files my taxes or I don’t plan to look at them for another month or two because I really can’t do anything about it one way or the other.” But I will tell you if you haven’t filed them. You don’t know if you owe money or not. Get them prepared. At least I don’t care if you do it yourself. Whatever. Find out how much money do you owe? Is there a refund? Sometimes, surprisingly enough, there is. For most entrepreneurs, self-employed individuals, no, there isn’t. But if your goal is to eventually get out of problems with the Internal Revenue Service, you got to move forward. I mean, even the IRS, they don’t care so much about the past as long as you move forward with doing the right thing, which may be meaning every time you take a check out of the bank to pay your household bills you take 25% put in a tax account. It’s no different than if you work for somebody else. You don’t even get 100% of your paycheck when you making 50,000 they’re taken out 15 of it and then you know, you’re living off 35 whatever the situation might be. The same thing has to be done for the entrepreneur. If there was a way to take a paycheck, then I would suggest setting it up where you can do that. Treat your drawls as if their paychecks if I was ever to teach anything to small business owners that is the answer. Treat your drawls to make sure that you can actually take out the amount of money. So if you need $1,000, don’t just take 1000 you need to take out 1300, whatever married single whatever your situation and set the difference aside in the bank so that way you’re able to do what you need to do and make it work.
Dr. Friday 40:22
So if that’s the case, give me a call and I can help you figure out what’s the best way to do it and how to do it. Because once you learn to do that, it’s no different than I’m sure financial planners would all say, “Learn to live off less than what you earn,” because you need to set aside money for retirement. Well, it’s the same thing when we’re in business. We have a built-in partner in this business. Now, some people don’t like the word partner, but whatever you want to call them. The Internal Revenue Service as a part of every single business owner. We all have to pay them we all have a situation where that money needs to go to them. So when we make $1 we need to set aside so much, depending on your income bracket, a minimum of 15%, most likely 20 to 25% in a separate account so that when that time comes, you’ve learned to live and give them their share of the business, no matter how you like to look at it. That is the fact. So if you don’t understand that, or you’re sitting there going, “This isn’t fair, whatever.” Well, I’m sure employees don’t like having their Social Security, Medicare, and federal withholding coming out any differently than we like to pay self-employment tax and federal withholdings.
Dr. Friday 41:29
So if you’ve got questions, all you have to do is give me a call at 615-737-9986, which is the number here in the studio. You can call us here if you’ve got any questions about that. Or if you’re a little shy, and you don’t really want to call this you can call my office. Again, I’ll start giving that number out. 615-367-0819 is the direct number to our office so that way you can make sure that you can either set up an appointment or if you’re not too sure who I am, hey, just check out the web, Drfriday.com, It’ll tell you about who I am and kind of what I do. I’m not just a crazy lady on the radio, I actually do taxes and help representation. So if you need help with those things, we also have a small bookkeeping firm attached to our firm. So if you need help with QuickBooks, or QuickBooks certified, and we can help you start your business, do it right, get your online QuickBooks, or your desktop with this set up and running it every month. So you have someone helping you, making sure your accounts are reconciled, and that your financial statements make sense. Because every once in awhile, we’ll get financial statements in here where someone else is preparing them. And it’s nothing to do with, hey, don’t ask me to repair your car, and I won’t ask you to prepare my tax returns. That’s the way it kind of works. Not everyone is an expert in everything. Sometimes you’ll have income under expenses and expenses under income and balance sheets that look like they’re a little bit upside down. It’s not that the company is in bad shape. It’s just that someone didn’t really understand debits, credits, or how it all kind of works to make sure it makes sense and so sometimes you need a second for someone else to help you with that, and you can do that, all you have to do is pick up the phone or check me out on the web.
Dr. Friday 43:06
The phone number to the office again is 615-367-0819 and the website is Drfriday.com. So if you need help with that kind of thing, or if you know someone that might need a little assistance on those lines, give us a call. We’d be more than glad to help but the most important thing is making sure that you file your taxes. And if you haven’t, well at this point if you did not file an extension if on July 15 this year you did not file an extension and you have not filed your 2019 tax return. My suggestion is unless it’s a refund if you have a refund people these dates have no bearing on that situation. But if you owe money, you need to file those taxes ASAP. If you haven’t filed your corporation, your partnerships, your nonprofits, any of those you’re not any of those that if you’re not in all of those have deadlines and you missed them. March 15 was the act deadline for corporations and partnerships and multi members LLC. If you didn’t file those on March 15 or and or an extension you’re already way late and if you didn’t file your personal tax return on or before July 15 you are now late and late fees is something we don’t like to have because you can maybe talk yourself out of it or talk your way out of it. “I lost my job I wasn’t able to pay for tax preparation. I don’t have any idea what I’m going to do,” that kind of thing. Cool, I guess. But when it comes down to it, I can’t see the clock just so you guys know. It was able to be able to see what we have and we’re moving on so that way we’re able to do what we have. But if you want to do anything else we’re in good shape.
Dr. Friday 44:49
So one more time, go check out the web, Drfriday.com. Check out the email, Friday@drfriday.com and If you have questions about you know, just need a call someone says, “Hey, do you do this or do you know whatever,” pick up the phone 615-367-0819 and you can have any help that you might need, do what you need to do. Make sure we have the section going on. But we’re ready to go out so call 615-367-0819 hope you guys have an awesome Saturday.