Welcome to another episode of the Dr. Friday Radio Show! In this episode, Dr. Friday takes on the latest tax updates, answers callers questions, and talks over the following topics:
- Tax Extension deadline Oct. 15 to file your tax return
- How To Know If You Are Paying Penalties and Interests.
- Have There Been Tax Changes Done to the Capital Gains?
- The New Charitable Contribution Deduction
- Can I Get My Child Into College If I Haven’t Paid My Taxes?
- How to ensure your Stimulus Status
- FBAR Extention Until Oct. 15, 2021
- New Tax Increase In ETax and Cigarettes
- How the Increase of Labor
- Earned Income Credit for taxpayers with Non-Qualifying Children
- How To Get Back on Track With the IRS
and much more!
Transcript
Announcer 0:00
No, no, no, she’s not a medical doctor, but she can share a cure for your tax problems or 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. 615-737-9986. So here’s your host, financial counselor, and tax consultant, Dr. Friday.
Dr. Friday 0:28
Good day, I’m Dr. Friday and the doctor is in the house. So if you’ve got tax questions, we all know that October 15 is just around the corner. And it is time for all of you procrastinators, which usually includes me this year, I did manage to get mine done before October 15.
Dr. Friday 0:44
But been there done that, you need to be able to get your taxes filed on time. And remember, it doesn’t extend the money you owe. So one of the hardest thing is always to, you know, explain to people, “You owe this and there’s going to be penalties.”
Dr. Friday 0:59
Your money is due on or before April 15. Normally in the normal worlds where we don’t have all these extensions and things. And then if they do give us an extension, an actual federal extension like we had one because of storm damage and things like that many people in Nashville, Williamson County, Davidson had until August 2, right?
Dr. Friday 1:20
And there wasn’t going to be a penalty if you hadn’t paid like normally in April. But at this point, anything you haven’t paid after that August 2, assuming that you were not in that extension, you are now paying penalties and interest. Assuming you have a legitimate extension, you will not pay a late failure to file a penalty until after October 15.
Dr. Friday 1:43
They’re still going to get you to fail to pay on time failing to make quarterly estimates all kinds of other failures to do. But that one is one that you really do want to have. Because most of the other ones are like point 5%, when you get a failure to file, it is 5% per month up to 25%. So that was really, really painful.
Dr. Friday 2:05
So just wanted to put that out there. If you’ve got questions, or maybe you’ve been following a little bit about what’s happening in the news as far as what’s kind of passed the house, and now they’re looking at some proposals of what they’re going to do. They keep calling these changes that they’re doing that they’re not going to affect the middle class, which is obviously what Biden ran on.
Dr. Friday 2:27
And the thing is, he ran on he wasn’t going to do proposals that were going to be over, it wasn’t gonna affect anyone unless you make $400,000 or more. But yet, a couple of things that are now on the table, of course tax unrealized capital gains, some other ideas of mainly the capital gains tax.
Dr. Friday 2:49
They’re also going to hit some new taxes that they have out there raising cigarette tax and adding in E tax. I don’t smoke, so I guess it would have no effect directly to me. But I have a real issue when they just start throwing in luxury taxes and liquor taxes and cigarette taxes. And they just keep grabbing more and more things they consider those.
Dr. Friday 3:09
So I mean, you know, again, it does affect quite a few people. They claim that by just adding an additional tax to cigarette tax and adding in the E tax that’s going to raise more than $96 billion in revenue. That’s pretty good. I guess, may be a reason to stop smoking, if you have one.
Dr. Friday 3:27
If you do have a question, you want to join the show, you can 615-737-9986. And so what a lot of the individuals are saying if they do that tax, you know, the bottom line is a large number of people that smoke, it hits all demographics, right? So it’s not going to be people making 400k or more.
Dr. Friday 3:53
In fact, statistically, a larger number of Americans are actually making less than $400,000 a year than smoke apparently according to this page. So that is something to look at. I mean, right now, guys, there’s a lot of talk. The biggest concerns I have, obviously is the removal of the 1031 exchange, the increasing capital gains tax, the reduction of inheritance tax, these are all and of course, increasing the corporate tax again, that’s another one that’s on the table.
Dr. Friday 4:22
And I know some people are like, “Well, you know, the corporations can afford it.” But let’s be honest people, the corporations aren’t going to afford it. They’re just going to increase their prices. I mean, it’s like anything else. Go to Five Guys and order a burger and fries and a drink and you’re gonna pay 15 bucks. I mean, that’s just what it cost. It used to be what, $7-$8?
Dr. Friday 4:43
Now again, I’m not maybe many out as much as I should be at some of these places. But all I can say is, is they keep increasing the price of their food and everything else because the cost of doing labor they’ve increased all the labor prices. So now we’re going to have to pay it.
Dr. Friday 5:01
That’s what happens along with all these things. I mean, you know, they increase the cost of living. And then basically everyone else brings their price up, right? So just pointing out that you’re going to actually see if we start impacting corporations, we’re just going to see it at the grocery stores or in anything that we buy, because a corporation is not going to lose money for their shareholders that they won’t stay in business very long if they do. So that will just increase the prices of whatever it is they’re making. So I don’t think the government should. But hey, what do I know? They’re not asking me.
Dr. Friday 5:35
So if you’ve got questions concerning taxes, again, it is October 15. Today’s October, what, 2nd? So we have about 13 days left to finish up tax returns if you haven’t filed a tax return, or if you haven’t filed taxes in a bit of time.
Dr. Friday 5:50
I mean, of course, the last couple of years have been kind of a crazy time of the year with COVID, and everything and some people have gotten behind. But maybe you’ve gotten behind before that. It’s not that hard to get straightened out to be quite honest. We can get you back on track, maybe it’d be a good time.
Dr. Friday 6:07
I often tell people, it’s not when you get back on your feet, that you want to be dealing with the IRS. You really want to talk and deal with the IRS, when you’re not at your best. Because they’re basing your ability to pay on what you have today. Not what’s coming up in the future, not what you might have coming in, but where you are today.
Dr. Friday 6:27
So now is the time to think, Hey, you know what, right now I don’t own a house. I’m at pretty much a job that I’m ready to go and find a new one. You know, I have very little access to anything else, I don’t have a lot of assets.” Then you want to talk to the IRS when you hear about all these things on the radio about how we can give you 10 cents on the dollar. That’s the coin that people were talking about.
Dr. Friday 6:50
I mean, let’s be honest, if you have equity in a home, you have a 401k, you have assets that you have the ability to pay, why would the IRS want to make a deal with you? I mean, you know, they’re in business this day, and anyone says the IRS is not a business is a little crazy.
Dr. Friday 7:04
So if you don’t know the answer to that I’m an enrolled agent licensed with the Internal Revenue Service to do taxes and representation. Which basically means all I do is taxes or talk taxes or deal with tax issues when it comes to doing different things with either the IRS or the state of Tennessee. In most cases, I have dealt a little bit with some other states, mainly California and some.
Dr. Friday 7:26
But if you have an issue, if you’ve just put it in the backbone and you’re like now is the time maybe you should think about taking it and moving forward. The sooner you get it off your back sooner you can actually start breathing or gosh forbid, maybe want to buy a house or do something else, then you can actually move forward and take care of the issues or, you know.
Dr. Friday 7:46
I was talking to someone else. And they were saying that. Apparently, if you haven’t filed taxes, getting your child in college can be a bit of a challenge because FASFA requires at least the last year or the prior year’s tax returns to be filed. And so that would be really, really important to do something with.
Dr. Friday 8:06
So, you know, again, you want to give your kids the best, you want to do everything you can. And I know it’s not always easy, I’m not saying it is but we can’t move backward, all we can do is move forward. So if you’re looking for someone who’s going to help you move forward and do something, I’m your girl, all you want to do is give me a call at the office.
Dr. Friday 8:23
But right now, if you’ve got any questions about maybe current tax things, you know, we’ve only got a couple more months of 2021. And we’re going to be doing this all over again. Tax time we’ll be starting and it will be time to start doing what we need to do.
Dr. Friday 8:38
So if you are considering, you know, selling something, what’s the capital gains going to be? I want to put on the table. As of today, there has not been any tax change done to the capital gains. So we still have the current law tax laws in play. Can they are will they change the tax law? I think they’re working very hard to do that. But I don’t have a magic ball.
Dr. Friday 9:03
So I can’t tell you if we’re going to go from 23.8 to 40% tax don’t know the difference until we get the law passed. And at that point, a lot of people are saying, “Well, if it’s going to happen in the next year, I need to do it soon.” But keep in mind, you might have other alternatives right now there are other options. 1031 exchanges are one that is still on the table and you’re still able to do what you need to do but you know, you need to sit down with somebody and try to calculate all of the options you have.
Dr. Friday 9:35
Many people are selling things because right now let’s be honest, the price of things went up it’s a good time to do it. But what are the capital gains and you have about 90 days after you sell that thing? Now I’m not talking about your primary homes because in most cases primary homes have a different tax code.
Dr. Friday 9:54
But if you had rental or inherited home a second home all of these are going to be taxed at capital gains. rates. And very, very important that you actually send in an estimate, if you’ve already sold that home, because basically, if you sold it in August, you probably should have made it by within 90 days of the date of that sale, so you’ll need to do it before the end of the year. But that’s the way it’s going to work and how it’s going to come through to make sure you have everything there.
Dr. Friday 10:21
Alright, let’s get Bobby on the phone so people can hear a decent question. Hey, Bobby.
Caller 10:28
Hey, Dr. Friday, how are you doing today?
Dr. Friday 10:31
I am doing awesome. What do you bring to the table?
Caller 10:34
I know that this is a tax program. But I would like to clarify some particular issues with you. Because finally, I get the opportunity to do that. And this does relate to taxes.
Caller 10:48
I know that this infrastructure with Nancy Pelosi and the president has all of the things which are included with it, and they don’t want to pass this thing through because there are trillions of dollars of things that are going on.
Caller 11:06
Wouldn’t you think, and you can perhaps be a voice for everybody, wouldn’t it be recognized that we can do one issue at a time compared to combining all of this together? So we can actually see what’s going on with this?
Caller 11:22
Because the taxpayers are the ones in which are paying for this stuff, they don’t even know what is going on. And Nancy Pelosi is like, you know, 12:01 at night is a new day and everybody’s sleeping, is trying to put things in, you know, number 168 in the books that nobody even knows about.
Caller 11:41
And I would like you to talk about that because we are the American people and this is our country, we vote for these people. Isn’t that something that we should have an opportunity to speak about?
Dr. Friday 11:55
Yeah, well, I think you’re passionate. I think you’re correct. But I mean, I guess since I don’t know your age, been here a little while I have seen more than one tax bill or what’s always more frustrated me is than passing a you know, infrastructure bill that has a ton of tax issues on it.
Dr. Friday 12:12
If you’re going to pass tax law, let’s pass it under a tax law thing versus the you know, hiding them in other bills. And in this one, they’re not even breaking it down. They’re just saying, “We’re going to do this,” but they have no documentation of how they’re really going to accomplish it.
Dr. Friday 12:26
I think that’s what’s holding up a lot. I think there are several they’re questioning it. But I don’t know the answer. This is why I will never run for politics, I’m gonna be quite honest with you. I don’t know why they can’t just make it simple and just say, “Hey, we’re gonna do this. Let’s all say Aye or nay and let’s do this.”
Dr. Friday 12:44
But I think there’s so much back-slapping and you know, “You give me this and I’ll give you that” kind of negotiating behind the scenes, Bobby that we don’t know of, which is why we should have terms and there should not be this kind of lifelong relationship in these situations.
Dr. Friday 13:01
Because I think there’s too many ways that people are greasing their own palms in my personal opinion, but I’m not a politician. So I see the tax dollars being spent and I don’t see anything that we’re getting for.
Dr. Friday 13:16
Alright, we may have lost Bobby there. So let’s go ahead and move on. We’re gonna take our first break here. And when we get back, we’re going to take more of your phone calls, if you’ve got some questions or maybe comments.
Dr. Friday 13:26
I know it’s a little slower at this time. Many of you guys have probably already filed your taxes. But if you have questions, or maybe you’re concerned with something you’ve got doing this year, maybe inherited something or you’re sold some real estate, you’re not sure what the tax might be. Give us a call here at 615-737-9986. We’ll be right back with the Dr. Friday show.
Dr. Friday 13:50
All righty. We are back here live in the studio. This is the Dr. Friday show and I’m an Enrolled Agent licensed by the Internal Revenue Service to do taxes and representation. So if you’ve got questions, or you’re just curious about something that’s going on in the tax situation, give us a holler here, and that way we can help you do whatever it is you need to do.
Dr. Friday 14:23
I did want to bring up a couple of things that are getting that I always talk about the deadline for individuals. But FBAR extensions are also nearing 10/15 will also be for anyone that has foreign bank accounts that have to do the replying or reporting on those. And then there are also some other little things that you might like business licenses if you haven’t already filed now they’re sending out love letters in the state of Tennessee.
Dr. Friday 14:48
So making sure that you filed your business license. And this year is gonna be the last year if you do payroll. A lot of small companies do and maybe you have 10 employees or more, starting in 2022, they’re going to require you to electronically file those if you have 10 or more employees so that’s really important again, just informational but if you are using a software like QuickBooks, most of them have electronic delivery available for W 2’s.
Dr. Friday 15:20
But if you’re still old school handwriting checks have one or two employees that are not going to affect you but if you have up to 10 throughout the whole year then you’re you know, they’re going too heavy fines and penalties so you might want to, you know, link up with something on online or get some payroll service.
Dr. Friday 15:38
I’ve always thought it was almost impossible for someone to do payroll by hand because you have so many different changes and different things you have going on but it’s really really important that you know what you have so you can move forward and you know, get what you need going and make sure you have you know the information because paying penalties just is horrible.
Dr. Friday 15:59
Alright, let’s hit William if he’s available. Hello, William.
Caller 16:03
Hi, how are you doing?
Dr. Friday 16:05
I’m living the life, my friend.
Caller 16:08
I’m just trying to sort through some things as always. Over the next six months, I have some double EE US savings bonds that are going to be maturing and I have not paid taxes on these year to year to year so save it all to the end.
Caller 16:27
And I’m just wondering how this is going to play out tax-wise. Let me say that starting next month in November, I think I’m going to realize when I cash these bonds in a little over $2,000. And then in December another 2000 and that can be or maybe 4000 the next year 2000 in January 2000 in February, but in March I’m going to be looking at perhaps realizing 32,000 or more and then in April and other 2000.
Caller 17:05
So the majority of its going to come in March of next year. So, all of this will not be taxable but I suspect a large part of it will be taxable as interest.
Dr. Friday 17:22
Correct. So, whatever you’ve earned and since you haven’t paid it which normally is the case you wait until you receive it at the end. But that part is going to actually be required for you to be able to pay the interest so you may or may not know how much that is.
Caller 17:39
Well, I don’t know exactly till I cash it in.
Dr. Friday 17:43
Do you know what your normal income bracket is?
Caller 17:47
I think I’m up like 22% now.
Dr. Friday 17:50
Well, because the only reason I was asking is that your, Alexa is on in the background, is that your tax bracket may change I mean how close you are right?
Caller 18:04
Yeah, It very well could.
Dr. Friday 18:05
Yeah, I mean it depends on you know, 22 and 24 do not have a big difference so the only reason I was saying that you just may need to take a look and see. I don’t know, is there any way like on TreasuryDirect or any of that I know I have some savings bonds that will tell you how much the interest is? Do you know?
Caller 18:24
I think I have a pretty good idea because somebody else I know cashed money in recently and I took their figures and just kind of projected it and I think I have a pretty good idea.
Dr. Friday 18:40
Well, I mean the bottom line is its effect we have a progressive tax code so if you know you’re pretty much in the 22% tax bracket you probably if you do your own taxes you can see what your effective rate is.
Dr. Friday 18:51
But a lot of times the effective rate maybe is only 16 or 17 you’re not at the max yet. So that way if you set aside 22 you probably be more than prepared for what you have but it will be taxed at ordinary income tax which is what I think you’re asking me.
Caller 19:04
Yeah, well and I haven’t really gotten to the main question of what I wanted to ask is that after all this will I have to pay or should I pay estimated taxes especially next year when occurs in the beginning of the year?
Dr. Friday 19:20
So anytime we have anything that happens we basically have 90 days or the next quarterly is when we should make it so the answer is going to be yes. Especially the first quarter. You may not need to make all four quarters because of them depending on if every month you’re getting to but especially the one where you get the large cash and I would say yes you do need to at least pay in you know 90% or thereabouts.
Dr. Friday 19:43
Now if you always get refunds, you can kind of take that into account when you’re doing it William but I would definitely send in the money because we don’t want to get hit with not paying quarterly or you know, not paying in enough and then hit with a penalty. I hate penalties.
Caller 19:57
Sure. Now this year in November in December if I cash those in it’d be not gonna be that much longer till I file my regular taxes you know?
Dr. Friday 20:10
Yes, you should be fine on those two for two reasons one it’s only for me not only but the cash in is 4000. Is that the interest or is that the total cash in?
Caller 20:21
I think that I think that’s the total cash and we’ll be looking at more than 4000.
Dr. Friday 20:25
So, you know, I mean you may be looking at 2000 or maybe I don’t know how much you know how much we paid originally or whatever, but probably isn’t it’s not going to have a huge effect on your taxes to be quite honest, I don’t think.
Dr. Friday 20:36
So you know, you’re looking at maybe $400 or $500 max, I mean in that conversation, so I don’t think it’s going to hit high enough to make a requirement for estimates but in 2022 definitely going to be required unless the interest was really bad on those then you might not have to worry about it.
Caller 20:55
Right. So let’s see, the last ones will be cashed in in April so I have 90 days after that or should I go since the most of us in March 90 days from March?
Dr. Friday 21:08
I would use 90 days from March If I was your tax person. You can always because the last one is in I think you saying the last one is April for that year?
Caller 21:17
Yeah, but it’s 2000.
Dr. Friday 21:18
Yeah, exactly. So you’ve got the first one that’s a two and then you get 30 something so you and you can even add in that one you’ve got a rough idea so you can just send it all in at one time and then that way you don’t have to worry about making four of them or two of them or whatever cuz I know making quarterlies is never fun.
Caller 21:34
So that’s going to be 1040? And then once that’s done April of next year and I’m done with the savings bonds I have no more of them. Okay, good deal. I appreciate your time.
Dr. Friday 21:54
Thank you so much. I appreciate you. Bye-bye.
Dr. Friday 21:56
All right, that was a great question and again sometimes when you’re doing your taxes we have interesting or unique things that come up you know? And you’re not always sure law you guys many of you that listen do your own taxes and there’s absolutely nothing wrong with doing them unless you’re not sure what you’re doing.
Dr. Friday 22:13
Guessing on your tax return is never a positive situation, guys. So if you need help or if you you know, need someone to bounce an idea off of or something like that. I’m usually available or the radio shows here for that to just you know, there’s no silly questions.
Dr. Friday 22:28
I always think that someone that doesn’t ask a question is probably the silly person because if you don’t ask them how are you going to know and then how do you plan for what you’ve never really done before right? I mean, like to tell you I mean, I’m really good at one thing which is taxes.
Dr. Friday 22:42
So if I’m talking insurance or I’m talking you know, cars or construction or anything like that, I’m not gonna know it either. That’s what we have professionals in all those different divisions to help all of us out so again, so if you’ve got questions you want to join the show, there are no silly questions.
Dr. Friday 22:57
So if you want to join the show, 615-737-9986. We are taking your call and then we’re going to also talk here a little bit about some of the things the IRS is warning us again, because apparently we have quite a few you know, those irritating phone calls that I have a tendency you know tax scams and alerts that are happening.
Dr. Friday 23:25
There are quite a few new ones out there that they’re advertising there. There’s a couple of them that are promoting certain settlements from the IRS pennies on the dollar. Yeah, you guys know about that? Well, the IRS website says reminds taxpayers to beware promoters claiming they can serve service your needs by settling with the IRS, you know that these are debts pennies on the dollar.
Dr. Friday 23:46
That is one of the number one on the dirty dozen. So again, there are ways in negotiating there is you know, all kinds of advantages to being able to do things but not everyone’s going to get the same situation. It really does depend on each and every one of you. So if you have questions on the IRS, I’m your girl, give me a call or set up an appointment in my office so that we can go through and take a look at what you have.
Dr. Friday 24:12
We’re going to take our second break here so if you want to join the show, now would be a great time to go bug Levidious. 615-737-99866 is the number in the studio and we’re going to be right back with the Dr. Friday show.
Dr. Friday 24:39
All righty. We are back here in the studio hopefully Alexa will keep herself quiet now and we are ready to go. Let’s hit Edward and see if I can help him with the IRS and the fun that we all get to have. Hey, Edward. What can I do for you sweetheart?
Caller 24:56
Tell me what I can do about contacting the IRS to light a fire under them? Basically, I filed my tax return on May 17, the last day to file because I forecast my taxes for this last year, well enough so that I only had to pay a few $100..
Caller 25:17
Well, 17th rolls around, and I find that we don’t have to pay taxes on employment income, which my wife had received, so I’m actually getting a considerable refund. But I haven’t heard the word. I go to the Where’s My Refund and say, “We can’t provide you with any information.”
Dr. Friday 25:36
Really? So did you mail this return in? Or did you actually e-file this return?
Caller 25:42
I mailed this return indirectly at the post office drop box.
Dr. Friday 25:47
Edward, I’m gonna say that you need to refile it. Because if you’ve if this is what we’re finding out two things you could do, I’m gonna give you a phone number for the tax advocates office. Since it’s been that long, they may take the case to help you out.
Caller 26:01
I tried to the tax advocates office and I get a recording, the recording says we call this number and it says nobody’s here to help you. Because there are too many people calling. I’ve been through that routine already.
Dr. Friday 26:14
Gotcha. All right. Yeah. And I’m sorry because I mean, I know. I mean, I make a living calling the IRS. So I know how frustrating it is. I can tell you on Friday, I made a call. I waited for 45 minutes, I thought I had a person. And she basically hung up on me. So you know,
Caller 26:34
I have avoided refiling, simply because the instructions state that if you refill, it may delay it even more. And God knows I don’t want that.
Dr. Friday 26:43
Yeah, I don’t think that’s gonna happen in your case, Edward, the only reason I’m saying that is if by now, they should at least have it saying that it’s processing. If they say that it’s not a big deal, there’s nothing in there. That means they don’t have the return.
Caller 26:56
That’s what I thought. Because I just recently, within the last couple of weeks, got on the IRS and made myself an account for getting forms like transcripts. And there’s actually a statement in there that says a failure to file for 2020.
Dr. Friday 27:15
Did you certify it when you sent it?
Caller 27:18
No. Sadly, I did not.
Dr. Friday 27:21
Well, sometimes the way that if it’s a first offense kind of thing, and they haven’t done something in the last three years, but right this second, my suggestion is to redo it and certify it this time. There is no there’s no I mean, it’s been plenty of months for them to get their act together.
Dr. Friday 27:37
So I’m going to make the assumption it never made it or if it did, it’s been lost. So you know, you need to start the time clock again. And least this time you certify it, you’ll see it and it should at least then show pending, processing your return we’ll get back to you soon. Something like that, you know what I’m saying? I feel that they haven’t gotten yours in there.
Caller 27:42
Some of those forms are going to be difficult to find again.
Dr. Friday 28:05
That’s not good. You didn’t keep a copy for yourself, mate?
Caller 28:08
I did keep a copy for myself that I’m a programmer and my work environment is surrounded by the last thing I’ve worked on and all flat surfaces in roughly chronological order.
Dr. Friday 28:19
Okay, well start digging.
Caller 28:22
I will. Thank you for your time.
Dr. Friday 28:24
No problem. Thanks. Let’s go to Corey.
Caller 28:28
Yes, ma’am. How you doing? I have just recently got married about five months ago. And my wife had bought a townhouse about a year before we got married and we needed a bigger home.
Caller 28:48
So we sold the townhome and made a decent profit off of it and put it right back into the home that we currently bought and live in now. And she didn’t have the house for two years.
Caller 29:03
Do we have to pay any taxes off the money that we made up the sale of the townhome even though we put it in a house that we’re living in now?
Dr. Friday 29:11
Yes. To comply with the current tax law you have to have lived in the house two to five years unless that you were put in the hospital or your job requires you to relocate that’s like the only exclusions in that conversation.
Dr. Friday 29:27
Getting married and a medium bigger home isn’t going to require so whatever she in the tax law right now does not have anything to do with reinvesting into other real estate. So at this point, whatever she made is going to show as capital gains. It will be long-term capital gains because she did live there for more than a year, but it’s still gonna be capital gains. Sorry, mate.
Caller 29:52
All right. Thank you so much.
Dr. Friday 29:53
No problem. Thanks. Alright. Alright, let’s look at Randy in Franklin. Are you there?
Caller 30:02
I’m here. I’m a paying client of yours. Love to hear your voice always. Anyway, five or six years of no filing. Am I in trouble?
Dr. Friday 30:21
Well, theoretically it would really depend on where you require to file? I mean if you’re self-employed, then most likely to be reported.
Caller 30:29
Yes, I am.
Dr. Friday 30:29
Well, most my clients are have struggled or whatever I’m big on the self-employed obviously I am. Um, so then yes, I mean, the fact that you haven’t filed you need to file to get into compliance, we need to go at least six years.
Caller 30:43
To interrupt Dr. Friday, I’ve done 2020 and 2021 I’m currently as far as you know, I’m on the radar on but I’m past due as far as the other five or six years.
Dr. Friday 31:06
So 2020 is the year that we’ve done, but we still need to do like 15 through 19 or something, right?
Caller 31:14
Correct.
Dr. Friday 31:15
Or whatever years they are to get us to get six years in compliance so that way, I mean, once we know what we owe, we can then either make you noncollectible make you pay, but you know if you if you’ve already come in, you know my theory, we need to pay forward firs. You need to be making estimates for 2021. And then we’ll deal with the past so that way at least we have the information going in the right direction.
Caller 31:36
So, I need to come to see you?
Dr. Friday 31:39
You do need to come to see me, my love. Yes, you do. We’re gonna get you back on track.
Caller 31:42
Okay. It cheers on that. Thank you.
Dr. Friday 31:45
Okay, I appreciate the phone call. Thanks. All right, bye.
Dr. Friday 31:50
All right, so we are moving forward. So if you have a phone call, this is great. You can join us here live in Studio 615-737-9986 is the number right here in the studio. So if you’ve got a question or you’re thinking about doing and I do know, I think it was maybe Cory that called about the IRS.
Dr. Friday 32:14
Guys, I get probably two to three calls or emails daily about people trying to so maybe that’s why the tax advocates have been so busy. I’m reaching out there as much as anyone else.
Dr. Friday 32:27
I’m trying to find ways to get answers because the IRS isn’t taking our calls when we get on to with the tax advocates and then they’re basically saying, “Well, people are overworked. There are not enough people.”
Dr. Friday 32:42
I mean again I’m not saying that that the people that are working for the IRS that there is an issue with that. I’m just saying that if you want us to be able to get into compliance you want us to do the things that you have expectations then there needs to be a way of us being able to do something to get information.
Dr. Friday 33:01
How do I know if the taxes are there if you’re not communicating with us and then there’s no way of finding them? I will say he was smart enough to go on and look for his transcripts because that does give us a lot of information. All right before we take the break let’s hit Chris real quick Chris getting back taxes done. Hey Chris.
Caller 33:18
How are you doing today?
Dr. Friday 33:19
I am doing awesome. How about you?
Caller 33:22
I am not doing well when it comes to my taxes.
Dr. Friday 33:27
Yeah, that seems to be a typical thing in my world.
Caller 33:30
I ran into a situation where I rushed into marriage and my wife didn’t change her tax status. I suffer from anxiety and stuff and it kind of just got to the moment to file my taxes. And I haven’t caught my taxes in about six years now.
Caller 33:47
I wasn’t sure about getting with someone trying to see what I need to do to get this taken care of to start the healing process with my taxes and my life.
Dr. Friday 33:55
Absolutely, Chris, and we do this every day. So all you need to do is I don’t know if you’re driving or whatever you can either Google Dr. Friday or I’ll give out my phone number here in a second.
Dr. Friday 34:04
But you just need to call us and we can set up a free consultation let’s get together let’s see what you have. I’ll need to get power of attorney so I can take a look at your transcripts and then you know we’ll be able to then move forward and come up with a plan and I actually do deal with quite a few people that have that same you know, I mean let’s be honest.
Dr. Friday 34:22
It gets overwhelming at that point it just becomes harder and harder to do something with it and we do have other clients that we can take baby steps you know? Get it resolved find the answers and not overly stress you any more than we have to but you know we need to get moving forward on it.
Dr. Friday 34:38
So all you have to do is give my office a call on Monday and we’ll be more than glad to set up a time for free to get together and talk and see what we need to do to get you back on track.
Caller 34:47
Yes ma’am. I would love to give your office a call and set something up and I appreciate you taking the baby steps because it just gets overwhelming and that’s how I ended up getting myself into this snowball.
Dr. Friday 34:57
Not a problem at all sweetheart. Before the break here in a few minutes, I’ll get my phone number out so that way if you have a pen if not again, it’s just Dr. Friday, Google it, you’ll find my phone number on the internet. Okay?
Caller 35:08
Thank you so much. Have a great weekend.
Dr. Friday 35:10
You too, sir. Thanks.
Dr. Friday 35:12
Yes, I honestly do have quite a few clients. The problem is so often with taxes, especially, it can be overwhelming. I mean, you’ve got the IRS, which is kind of, you know, the big dog and you know, they can take your house, they can take your cars, they can take your business, which in truth they can’t really take all those things, not without cause and not without an awful lot of reasoning behind it.
Dr. Friday 35:34
But it’s still there. And it’s scary. And you know, once you get behind it just becomes overwhelming, because now you’re not talking about owing them a couple of 1000. It could be a couple of 10,000s or hundreds of 1000s.
Dr. Friday 35:46
Again, depending on everyone’s situation. And so you want to make sure that you have everything in line and then you know, get it to learn to go forward first people anytime you’re dealing with the IRS, the first thing you want to do is make sure you’re paying forward because then at least we’ve stopped the bleeding. If you’re moving forward and you’re paying enough taxes, then we can deal with the past. Otherwise, it’s not going to be that simple.
Dr. Friday 36:09
Alright, so if you want to join us on the show, the phone number is 615-737-9986. And for Chris or anyone that wants to make an appointment, I hate confusing people. But sometimes it’s easier. My office number is 615-367-0819.
Dr. Friday 36:28
And we’ll take a quick break and we come back, we’re going to have the last 15 minutes or a little less than 15 minutes to take some of your calls, and talk a little bit more about what you might need to do and understand.
Dr. Friday 36:39
You know, it’s not that scary guys, we can make it through this together. I promise you we do it every day. And we’re going to take a quick break here looks like Lovectecuslavi is going to have a busy time. This is the Dr. Friday show. We’ll be right back.
Dr. Friday 36:52
All right, we are back here in the studio. And it looks like I got a couple of really good questions coming up. So let’s go to Dean and Franklin since he’s been on hold.
Caller 37:14
Thank you. And yes, I have a good number of double EE savings bonds. And they’re all because 30 years and out, but I have no idea what they’re worth now, after the 30-year maturity.
Dr. Friday 37:32
Was my understanding. I don’t think I think they stopped, do they not? I think that I mean, I could be completely wrong. I’m not a bonds person. So I’m not going to claim I know the answer to that. But I thought that was the point. I mean, I don’t know if they continue to earn interest after those years, or not.
Caller 37:49
I think the third interest stops after 30 years.
Dr. Friday 37:52
Right? So I was thinking too, so you need to catch those in. They’re not making any money more and more you need to go.
Caller 38:00
I have had a lot of changes going through here last night. I said, You know, I need to get those bonds out. And so the maturity dates on them, and I did they’re all for 30 years, so they can’t draw any more interest.
Dr. Friday 38:17
Well, I say I would say is if you’ve got quite a few of them, you might want to do it in a steps because you don’t want to get hit with a large tax bill. I mean, you know, if you a ton of them. So I would definitely talk to your tax person or your financial advisor, someone that can help you say, “Okay, you know what we can do $10,000 and keep you in the same tax bracket. But if you go over that you’re gonna pay from 12 to 22.”
Dr. Friday 38:42
So that can be a 10% increase where at this point, it may be especially, if you could cash some out in the next couple months, keep you in one, and then you know, January do another batch or something is all I’m saying spread it out versus putting it all at one time.
Dr. Friday 38:56
I would definitely talk to someone that you know, that can use your taxes and give you some advice or if you have someone that does your finances, let you know, let them know because it sounds like you might be sitting on a number of them. And if that’s the case, I have seen that. The good news is we don’t have the hall income tax any longer in 2021. So there will be no state income tax on the sale of those bonds.
Caller 39:19
Okay, yeah, I was going to just do a portion of the first and wait a while longer and add the do the other half.
Dr. Friday 39:30
Just take a look at your, yeah, again, just look at your taxable income. I mean, are you single or married Dean?
Caller 39:35
Single.
Dr. Friday 39:36
Okay, so the key number you’re looking at, and I don’t know your numbers, but if you sit down and calculate all of your income you want to have including this bond interest to be under 50 to keep you in the 12% and basically under about 105 to keep you in the 22 I’m not sure where you’re at in those numbers and I don’t need the just some guide for you.
Caller 39:58
Okay, I’ll go with my tax man and sit down with him.
Dr. Friday 40:02
just don’t want you to get a surprise and then you’re like, wow, I could have saved 10% if I just waited or something, you know?
Caller 40:08
Okay. But is there any kind of a chart or schedule where I could look up that double EE bonds after 30 years?
Dr. Friday 40:19
I think you’d have to go to was a treasury? I mean, I think if you look under I think it’s called Treasury Quest or something. There is a TreaturyBonds or there is a website. Do you do the internet? A little bit?
Caller 40:37
No, I don’t. Treasury website, you say?
Dr. Friday 40:42
Yeah, there’s a website that you can go to that will give you some of the rates. It’s called Treasury something I was trying to look up Ebonds. Let’s see if I can find the name for you. At least I thought I had it up earlier. There it is treasurydirect.gov.
Caller 40:58
Is Treasury direct?
Dr. Friday 41:00
Treasurydirect.gov. They won’t be able to help you with some of the dollar amounts.
Caller 41:04
You gave a, a website to go to and I didn’t have any luck with it, is to see if they sent you any kind of stimulus money.
Dr. Friday 41:14
That was irs.gov.
Caller 41:17
Yeah, I went to irs.gov. And that I couldn’t come up with anything when I use that irs.gov. Is there anything else with irs.gov? I should have put it in there?
Dr. Friday 41:31
Yeah, if you typed in irs.gov. On the very first page, when you go in there, it says to get my payment. Very first page. That’s what you want to click to find out about your stimulus.
Caller 41:42
Okay. All right. Okay. I’ll try that again.
Dr. Friday 41:46
No, thanks. Great. Let’s talk to Faith in my town, Spring Hill. Hello, Faith.
Caller 41:52
Hi. How are you doing?
Dr. Friday 41:55
I am doing awesome, actually.
Caller 41:57
Awesome. I love your show. Listen to it all the time. I was wondering, so he was my fiance. We’ve been together for years, we had two children. He didn’t really support us, you know, he lived off and on with us.
Caller 42:12
And he filed us as he files head of household and claimed me and the two children and his tax return this year. Is he able to do that? Like he didn’t pay rent or electric or cable. Nothing like that.
Dr. Friday 42:24
Well, theoretically, the answer would be no, because you have to provide more than 50% of their support. And if he didn’t, he lied. Does that happen? A lot? Yes, I think it does, probably.
Dr. Friday 42:36
But, you know, did you work? I mean, he claimed you. But he claimed you as a dependent. It sounds like not as obviously you’re not married. So do you have the ability, I mean, were you working? Because you earn I mean, no dependent can earn over $4,000? Or thereabouts anyway. You know, to be like a qualified dependent. So don’t worry. I mean, you are taking care of kids, I’m just saying you were at home taking care of the kids. Who supports them.
Caller 43:06
Well, my son has a disability. So I got about 500 a month with disability.
Dr. Friday 43:13
Well, theoretically, I mean, if he was still bringing money into the house Faith, your child’s disability is not considered earnings. So, therefore, he could still show that he maybe had 50% support. Did he pay child support or anything or no?
Caller 43:30
No.
Dr. Friday 43:31
Okay. Well, all I can tell you is, theoretically if he was ever audited, it would not happen. But in theory, there’s probably no one that’s going to contest it because you didn’t have any or income anyways. And he is the children’s father. So or do I think he is right? Oops, I think I lost faith.
Dr. Friday 43:52
All right, no worries, that’s fine. So anyway, if I mean, you could always turn him in to the IRS and show that he is not the person that did what he did, but not too sure how easy that will go. Alright, so we are getting down on the show.
Dr. Friday 44:06
So let’s go through the basic things. If you haven’t filed your taxes, October 15 is your deadline. So you really do need to make sure. If you need help, we may be able to help you 615-367-0819 is our direct number for the office. 615-367-0819.
Dr. Friday 44:28
And if you’d like to check us out on the web, sometimes you’re like, “Who in the heck is this person?” You’re a first-time listener and you’re like, “Dr. Friday? What is she?” Dr. Friday, I’m an enrolled agent licensed by the Internal Revenue Service to do taxes and representation reason I go by doctors go Ph.D., which has absolutely nothing to do with taxes. So probably not so important, but I worked really hard for it.
Dr. Friday 44:51
But if you want to have help and you need help with taxes, bookkeeping, your entrepreneur, you have back tax issues, I’m person that’s going to help you you can Go to email friday@drfriday.com check us out at the web drfriday.com. Or you can call us at 615-367-0819.
Dr. Friday 45:14
Keep in mind that whenever you have IRS issues or you, you know you haven’t filed for a few years, then the whole conversation comes back in and you’ve got to get back on track. it’s that important. You can’t move forward in life easily. Without having tax records. You can’t borrow you can’t do things.
Dr. Friday 45:32
Now I know there’s some people that live in the world of cash. I’m not sure how you do it, but it is something that people have managed to do. And in doing that, it does make it. But most of us have credit cards we need to be able to buy a house or pay something off and you need to be able to put your kids if you have kids, they want them to college. These are things FASFA requires tax returns.
Dr. Friday 45:54
So if you need help getting all that together, and you have no idea where to start, I can tell you we do know how to start we know how to get you back on track. It’s what we do and we’re very good at it. So all you have to do again, first step free consultation that way we can help you make you know make the right moves make the right decisions. I’m going to tell you right now not everyone’s going to get pennies on the dollar. It doesn’t happen all the time.
Dr. Friday 46:19
Many people owe 200,000 in deals 150 I mean if you can save the money and put it through and it’s something you can afford to do that’s what we’re going to help you do. Even if you can’t afford to pay the IRS right now you need to get in compliance because in all honesty, once you’re working forward, the time clock starts right the IRS only has 10 years to collect.
Dr. Friday 46:40
So as long as you’re filing your taxes on time, then they are only going to have so much time to collect that information. So if you need help again, you can reach my office at 615-367-0819 email is friday@drfriday.com, or check me out on the web drfriday.com.
Dr. Friday 47:06
There are places in there I’ll tell you all about what we do and how we do it. I hope you guys are enjoying this Saturday. I will tell you we are having a great time going to be going out to the hog festival here in Spring Hill. So if you have nothing to do, you might want to check it out. We’ll be down there enjoying ourselves. So hope you have a wonderful Saturday. Call you later.