Welcome to another episode of the Dr. Friday radio show! In this show, Dr. Friday shares all the latest tax updates, including the following topics:
- The IRS Is Hiring
- Why Have I Not Received My Stimulus Check?
- Will There Be A Second Stimulus Coming?
- Why Haven’t I Received My Tax Refund Yet?
- The IRS Is Hiring
- PPP Money: Forgiveness
- Why You Need Help With Tax Representation
- Is The Stimulus Money Taxable?
and other caller’s questions!
Transcript
Announcer 0:01
No, no, no, she’s not a medical doctor, but she can sure 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
Good morning, I’m Dr. Friday and the doctor is in the house. If you’ve got questions concerning taxes, if you haven’t filed your taxes for 2019, it is coming quickly. We only have until October 15. If you have a business, an LLC that is multi-member or corporation 1065, 1120, 1120-S, those were due on 9/15. So you may be late at this point, that’s assuming you filed an extension in the first place. Otherwise, you are just a late period. It’s time to talk taxes. If you want to join the show you can I am live here 615-737-9986. So we have a lot of things going on lately. Many questions coming from some of my listeners and clients concerning payments. Many people mailed in a check. And then obviously, it’s been months and they hadn’t cleared the bank. So in some cases, we have people that we told them to go ahead and make a payment. Because we had no proof in those cases that they had actually mailed the payment, besides their word, but there was no secured tracking. Then the checks are clearing the bank, and in some cases, they’re getting double payments, some cases that people made stop payments. The IRS is bouncing payments are getting returned payments, I should say.
Dr. Friday 1:52
This is a bit more confusing than our normal situation, and that’s all because the mailroom was months behind. Obviously, they’re getting caught up because they’re finding cheques and they’re starting to deposit them. The downside to that conversation is, is that if you already paid the bill once, you could end up either paying it twice. So I would double-check and make sure you made a stop payment. If you do bounce a check on the IRS, there are fees that they can charge you. So you need to make sure you’ve documented that the payment cleared. And the reason why you made the stop payment, etc. so that there is a chance of getting that penalty waived, most importantly, is tracking. So whenever you send something to the IRS a check, communication of any sort, you need to make sure that there’s tracking on it. So we have documentation showing that you filed this and that they received it. That way, you know, if you’ve got proof that they’ve received your cheque, but they just never cashed it, I would wait it out, especially in this year where we know that the mailroom was months behind in doing everything they need to do. Most importantly, you need to make sure that your communication is tracked because otherwise there’s no guarantee the IRS received it. Therefore, you may be waiting and accumulating penalties and interest on money that you assume they would get, and they didn’t. So very important for you to be able to track your information. The first lesson in dealing with the IRS, always make sure that you have a paper trail,l that is just common sense.
Dr. Friday 3:19
If you want to join the show, you can at 615-737-9986. Maybe you’re dealing with an IRS issue at this time, or maybe you haven’t filed taxes in a number of years. I am an enrolled agent licensed with the Internal Revenue Service to do taxes and representation. So that’s pretty much what I do. If you haven’t filed for a number of years, and you’re just sitting there going, “I don’t even know where to start, how to start.” It comes down to this, you have to start. You need someone to help you That would be me. So all you need to do is pick up the phone or the easiest ways to go to my website, drfriday.com, and make an appointment. The calendar is right there on the screen and set up a time for us to talk initial appointments are always free. Make sure that we’re all on the same page and we’re doing the same things. That way you know that you’re going to get the service that you need. Again, if you want to join the show, though, you can pick up the phone at 615-737-9986. To take your messages or take your calls, I should say.
Dr. Friday 4:20
We all know that there is an election coming up very, very soon. And if you don’t like what’s going on, the only way you’re going to change it one way or the other is to vote. So no matter what side what situation you need to vote based on what is your core belief and move forward, but you need to vote so that way you know there are going to be some pretty big differences from my standpoint, which is the financial and tax standpoint. There are some pretty different changes that you know each party holds. So make sure you do your research. I’m not going to get into politics on this show, but I think it’s very important that we all vote. So make sure you study the candidates that you know we get to. So it can’t be that difficult to study them. Also, I guess, study their vice presidents, because who knows who’s going to be president in the long run. So make sure you understand how all that’s going to work and vote for what you think is going to be best for this country. It used to be the majority was the situation. But nowadays, it always seems like it’s the minority. So we just need to make sure that we’re voting for what’s going to be best for this country overall. All right, so if you want to join the show, 615-737-9986.
Dr. Friday 5:39
Again, we have to file our personal tax returns by October 15, which is less than a month away. So if you’re working on your taxes, or you’re like, “I don’t know where to go, or how to get going,” you need to file because of a couple of different things. We all know that the stimulus check was based on they gave money out based on 2018. But it’s actually based on your filing of 2019. So if you have a little less money in 19, or if you made more money in 19, if you had a child, you didn’t have a child, that’s all going to change because when you file your 2020, they’re going to reconcile this information. Now, I will tell you at this point, the stimulus is not taxable. So my understanding is that the IRS made a mistake, there isn’t any way that they’re going to correct it if you got too much money. If you didn’t get enough money, though, you will be able to get the additional funds on your 2020 tax returns. So you are going to want to be in compliance because when they sent out the original stimulus, they could not apply it against back taxes. But when it’s on your 2020 tax return, guess what? That’s gonna apply. So if you owe money, they’re going to apply it and then send it against that at this point. But, there’s also a chance of a second stimulus. So making sure your taxes are up to date, and that you’ve applied for everything that you need to apply for, is the best way of moving forward and doing what you need to do. So not filing taxes, probably not the best thing in the world to have accomplished. So making sure that you’re dealing with some of the best things that you have and dealing with your taxes is something you need to handle.
Dr. Friday 7:17
If you are filing for the first time, because many times due to the stimulus, many kids that were 18, 19, 20 in the year of 2019 actually filed their own tax returns because they were able to get a stimulus check for 1200 dollars, instead of the parents getting the $500 for the dependent situation. They didn’t actually get the additional stimulus, they just got deducted on the tax return. So the question comes in 2020 if your child is a full-time student, and all in all the work and make $4,000 a year or something, which means they really truly your dependent, how are we going to file our 2020 tax returns? And I’m going to tell you right now, we’re not absolutely positive, because in all honesty, usually, we would claim them on the parent’s tax returns, they are the one that is totally supporting these children. And there is no advantage but you know, with the way the COVID has affected the financials, at this point, I would say we’re going to be putting them on hold. But normally, we’re going to file the best way that usually is going to save the best taxes, which is usually putting the child because they can’t get the credit for their education if they didn’t pay for it. And if they’re under the age of 22, they’re being supported by their parents, they’re going to be disallowed on some of the credits. So you need to understand what’s the best one for you and your family. I have so many people call me and say, “But my brother files like this, and he always gets more money than I do.” Well, I don’t know if his brother is head of household or if he’s married is their children, what age are the children, etc, etc. So doing what someone else says is good, isn’t always going to be the best policy. What we want to make sure is that we’re doing what’s best for you, and the right thing. So if you are legally married, and you hit that button, “head of household,” because you get a larger refund. Yeah, that’s just wrong. So you want to make sure you’re following the tax laws. When we file our taxes in the best of situations, we want to be able to file them scanning all the documentation that justifies them and move forward. We don’t want to be looking backward, worried that the IRS is going to be looking at them or auditing them because they do. A lot more paper audits are done than we used to have. They did actually send a memo out just last month, I think last week, excuse me, and it basically stipulated that the IRS is stopping the sink collection letters out all because of what I started the show with. People’s checks are sitting in the mailroom, yet the IRS was sending out letters with interest and penalties or money that the individuals paid on time, meaning July 15, at least at the time of filing their tax returns. So it was very confusing.
Dr. Friday 10:06
We had 6 or 7 letters that came through and people are like, “Do I actually owe this because they haven’t cashed the check yet, what am I supposed to do?” And at this point, we told them to wait. Because if you have proof that you made a payment, you need to wait because they weren’t posting the payments, but yet, they were sending out collection letters. So if you received one of those, and it happened to you, you need to make sure you’re not paying twice. That’s an important part of that conversation. And just keep in mind that when you’re filing your taxes, you do need to scan and keep those documents. I always say for seven years, all in all, they’re not going to audit more than two to three years. But if they find a big situation, they can go back further and further. So I always say seven years, save your tax documents. Nowadays, it’s not so hard, because you can scan everything in. So it’s not like you have to have all these boxes sitting in the garage, which hate to tell you, but when you go looking in those boxes a few years later, you might find that a lot of those receipts and documents that you thought were so safe, didn’t really whether well then the garage. So just the point of interest, you might want to just take the time to scan them in. That way, you’ve got everything backed up on a digital hard drive. I would make a secondary drive, put it someplace safe so that you can always access it, God forbid something happened to your main file.
Dr. Friday 11:22
So make sure you’re dealing with that and moving forward on your situation. So if you want to join the show, maybe you’ve got tax questions, maybe you have someone that hasn’t filed taxes in a number of years, or maybe you’re just not sure exactly how you’re supposed to go about filing these taxes, just give the show a call 615-737-9986. We’re taking your calls, we’ll talk more about how we can make a deal with the IRS, they do have the Fresh Start program and what exactly that means for some of you that maybe owe a lot more money than you think you’re ever going to be able to pay back. If there’s liens or levies against your house or paychecks, what can you do to maybe get a break from that and maybe work out something? Or is it the fact that you’re not going to be able to. When we get back, we’ll take your calls and also talk to these individuals. So you can do that 615-737-9986 we’re also going to go to the phone lines when we get back. Sorry, I just saw Jerry and Pete are both on the line. If you could hold through this break. We’ll be right back with you.
Dr. Friday 12:36
Alrighty, we are glad that Jerry pulled through the break. Why don’t we start with Jerry in Franklin, joining the show? Hey, is Jerry there?
Caller 12:50
I am here. Can you hear me?
Dr. Friday 12:52
I can hear you now what’s happening.
Caller 12:54
I just had a quick question about my quarterly payments, I issued my quarterly payment that was due on the 15th, on the 11th. I got a confirmation online. I did it through the direct pay IRS that it went through. I just got an email notification saying it didn’t go through now, and to pay it before the penalty kicks in or the due date. Well, I got it on the 16th. And the due date is the 15th. Do you feel that I’m gonna pay penalties for that? And should I just send in checks versus doing it online?
Dr. Friday 13:28
Well, 99% of the time, I would tell you online is always the best way because we get that instant notification that it was accepted. So you’ve looked in the bank and it hasn’t cleared the bank?
Caller 13:40
Correct, it never cleared the bank and told me that I would.
Dr. Friday 13:45
I would save those letters, and I would go ahead and resubmit it. Because it may just be a bank typo of some sort. Make sure the information is right. And then that way if they try, it’s only a few days that it’s going to be late. If they try, you can submit those as “No, I did do it on time, and this is what happened and I got an A 16th. And I immediately turned around and made it on the 18th.” Resubmit it but It will still be a lot faster than snail mail, which will delay it even more.
Caller 14:16
Awesome. Thank you so much. Really appreciate your show.
Dr. Friday 14:20
Thank you appreciate your listening. Alright, let’s go on to Pete in Hampshire. Pete you there?
Caller 14:29
I’m here.
Dr. Friday 14:30
Hello. Thanks for holding it. What can I do for you?
Caller 14:32
I appreciate you letting me on the radio. My number one question is, I still haven’t got my stimulus. I’m sure you get asked that a lot.
Dr. Friday 14:42
Well, I’m really glad you called only because there are a lot of listeners that are actually thinking, “Yeah, that’s exactly what I have got the same problem.” I’m going to give you guys all the same really bad answer because there isn’t any real movement happening. Obviously, you can go to irs.gov look and see if they’ve got any information. Where’s my stimulus? There’s a little button there. It says that.
Caller 15:08
I clicked on it and, nothing.
Dr. Friday 15:09
Okay, nothing’s happening. Yes. Then the other situation is, do you know or have you been in, I don’t remember if we’ve talked in the past. But you filed the 2019’s tax return correct?
Caller 15:22
Yes.
Dr. Friday 15:23
Okay. And you filed that back in June, July, or even earlier?
Caller 15:27
Earlier.
Dr. Friday 15:28
Okay, and you know they received it, like, Did you get a refund?
Caller 15:33
No, I actually had to pay.
Dr. Friday 15:35
Okay, did check clear the bank?
Caller 15:37
Not yet.
Dr. Friday 15:39
Okay. Did you send a check with the tax return?
Caller 15:42
No.
Dr. Friday 15:43
Okay, because obviously, you can make a payment plan, there’s a lot of options there. So you didn’t actually have to pay it. So the question I would have is, do we know for sure that they received it? Did e-file it?
Caller 15:56
Yes
Dr. Friday 15:56
Okay, if you e-filed it, then there should be a confirmation and you should be able to. My concern would do they receive 19 and even if they did receive it, I’ve got in my own office, I can name at least 10 people that we filed their taxes in March, April and May before the big deadline, and they are still on hold. Whenever we pull up, “Where’s my stimulus,” it just says, either, “at this time you don’t look qualified,” which doesn’t make sense. They were in some cases dependent the year before in 2018. They were dependent on someone’s tax return. I mean, these taxes have been filed and waiting. In most cases, they get refunds, so we know that received them. But here’s the deal, the IRS is still issuing them. They are supposed to be done in September, according to their website, they are still issuing stimulus checks. At this point, I’m too I’m preparing my clients that you’re basically going to get an additional refund for 2020. Because what we’re three months out from getting ready to file their taxes again? So, hopefully, that’s not going to be the answer, because, in a couple of cases, they’ll really lose the stimulus. At that point, they’ll probably apply it to an open balance that they owe money. And if they change the rules on 2020, initially, if you had the stimulus check, it could not be applied to open balances.
Caller 17:21
I paid all my taxes now I’m paid up. My concern is, it goes somewhere else, did somebody else get it?
Dr. Friday 17:28
Well, it should say that on the “Where’s My Stimulus?” It will tell you that it was mailed on this day.
Caller 17:34
Well, it doesn’t say that.
Dr. Friday 17:38
So have you tried calling the IRS on it?
Caller 17:42
Yeah.
Dr. Friday 17:48
No, they haven’t said anything. I haven’t called them on that particular issue. They
Caller 17:51
They say go back to the website.
Dr. Friday 17:53
Okay, so there’s worthless as I am, and they’re being paid. Well, answer to your question. I don’t have a great answer at this point, then, because most of my cases, its the same situation. We’re not getting any correspondence from the IRS, we’re not getting assistance. At this point, since it’s not like an IRS issue, because I’m just saying that they supposedly open up that phone number for people needing to call for stimulus information, but apparently you’ve called it and it’s not helping at all right?
Caller 18:29
Not at all. I was depending on you. [Laughter]
Dr. Friday 18:31
I know, I failed you!
Caller 18:33
You’ve been my savior before.
Dr. Friday 18:36
Well, I’m glad you’re still calling anyways. So all right. Well, thanks for calling. Anyway, sweetheart. I appreciate it. All right. So do I have someone else on the phone? Is Frank on the line?
Caller 18:52
I’m on the line. I had two questions. My first question is, I have an independent business I have. [Inaudible] And I filed him for the SBA loan, and for the payroll protection program, but they never sent me anything on the payroll protection and are fine for a small business loan, but I never got anything back. They just told me in the in-process since then, or I don’t know how long I’ve not received anything. No more email. Just send me an email one time and told me it was impossible, but since then, I’ve never seen anything.
Dr. Friday 19:34
Okay, so the one on the PPP that you put in for the gentleman that was on 1099 he needed to put his own PPP and you can only do it for people that were W2’d or under your own personal income from your schedule C.
Caller 19:52
Okay.
Dr. Friday 19:56
PPP ended, so there’s no more PPP money out there. At the moment, there are no loans available for PPP. Now, there may be some EIDL numbers from the Small Business Association, you may still have something out there. But the PPP obviously ended back in August, I think.
Caller 20:14
Right, because I filed in March, right after the stimulus came out the first time. [Inaudible] Then the filed the next day for the SBA, similar package loan, and I even received the just sent me a system processing them up to this time I haven’t received anything from them.
Dr. Friday 20:35
Well, as far as the stimulus one, there is a phone number for the SBA, have you tried calling them?
Caller 20:43
Yes, I did. I called them and they said, “We’ll email you, check your email. Your documents are still in process.” Since then, I have called them several times and they keep telling me the same things so I just stopped calling them.
Dr. Friday 21:01
Okay, I would actually call back, I would call the 716 number for assistance. Do you have the phone number for that? 716-843-4100?
Caller 21:11
Yes, yes, yes, I got that number. All right.
Dr. Friday 21:13
Well, if you had that one, I would give that number a call until I mean, at this point, you’ve not received an email you’ve not received in all this. I mean, the SBA is really efficient, at least it seemed like to me, on a few of them, I dealt with for people. If they didn’t get something in a few days, it was because either the email was put in wrong or whatever. So I would definitely give them a call again, it means you can’t really bug them too much. Say, “Hey, you sign me a number.” Because on the email, if you never received any emails, then that’s a problem because you don’t have confirmation. But if you received at least one saying that they are working on it, there would be an account number, hopefully, or something on there that you can give the assistant to get that information. So you really need to just kind of pull up those emails that you did receive. Did you get any emails?
Caller 22:01
Yeah, I got an email, I got it. It said, “Your loan is in process, and we’ll get back to you.” Then when I called them again, the lady told me, “we’ll get back to you just keep watching your email.”
Dr. Friday 22:20
It should have taken a couple of weeks at most, you know, I mean, you should have gotten some communication within a week or two after that first communication. If it’s been past that, I would say call back and say, “I got this notice back in August, and now it’s, you know, mid-September, and I still haven’t received an additional email. Was it rejected? What was the situation?” Because it sounds like you’ve missed out or theoretically could miss out on that, and you kind of want to get that straight, because they may be opening up the PPP again, for individuals that did not get it in the first place. Part of the conversation they have in the Heroes Act. So you know, we want to, if it opens again, we need to make sure that you’re totally set up and ready to go. So you don’t miss out a second time on that. Sorry, unfortunately, those aren’t the IRS but I would definitely call the SBA. If I was you call them direct.
Caller 23:13
Okay, thank you very much. Appreciate.
Dr. Friday 23:17
Thanks, bye. Alrighty, so I think is that everyone on the phone? I think so. If there’s someone else, let me know. All right, I’m in good shape. So thank you for calling guys. Because that always makes the show so much more interesting than hearing me talk about all the different subjects I find interesting, which is taxes, offering compromises. I know the stimulus has, I will tell you it has put a whole new meaning to my business and all the situations that we’re dealing with. We have absolutely I mean, they finally opened up that number but listening to my listeners they have calling that number and they’re giving you absolutely no help. It’s kind of like calling the IRS right now we’re having a lot of frustrations getting through. We are told that they are they’re hiring so if you need a job go the IRS but also they are getting more and more services reopened. So hopefully guys assuming that we get to control and everybody moves forward we’ll be able to get this issue resolved faster but we’re gonna take a quick break you can join the show at 615-737-9986. We’ll be right back.
Dr. Friday 24:38
We are back here in the studio and we’ve got these e-mails going because many people are similar questions came to me through email back and they’re both concerning, “If you’re self-employed and you’ve got PPP money as well as unemployment. Is my PPP going To be forgiven?” And that comes down to at least 60% of the forgiven amount must have been used for payroll costs. If you use all or most of the loan for nonpayroll expenses, then you will be below that dollar amount. So here’s part of the thing, when did you start your PPP? When did you start your unemployment? Because now under the PPP, we have 24 weeks, that 60% of it would have had to be used. Well, most people got it based on 2.5%. So that would have been two and a half months. So, you might have been able to get your unemployment and still meet the unemployed assistance, because you might have stopped on employment and actually use the PPP. In some cases, that’s going to work. In other cases, it may be better for you to not apply for forgiveness, which in some cases, could create hardship. But 1% loan over five years, pretty sweet. For most small businesses very difficult to go to a bank and get money at that rate. I guarantee you, I’ve never been offered it, maybe there is something out there I don’t know of. It may be that your PPP will not be forgiven. Remember, a lot of us have just started the process of forgiveness. I know I was working on a Bank of America situation. Some banks are reading the law as eight or up to 24 weeks. Some are very black and white, eight weeks, 24 weeks, you choose which way you’re going in the case that we are working on one that we are going to use the 24 weeks. Actually, we only need like 11, but 24 weeks situation now we have to wait until mid-October to apply for forgiveness because they’re only allowing it to be applied as soon as you’ve hit the 24-week deadline.
Dr. Friday 26:58
So every bank is going to be different is all I’m saying. If you are a small business owner, and you applied for unemployment, as well as PPP, in many cases, let’s just be honest, you may have been making a good chunk of money for a period of time, they’re able to keep your business going. Hopefully, you were able to also move forward and keep your business going. Again, PPP money, you know kind of went, it should have initially was going to be for almost all payroll, but it can be 40% can be used for paying rent and utilities, health insurance, and certain interests, mortgages, but it would have to be a business a very, very close number. When you’re going through the forgiveness process, you need to have specific documents and a lot of small business owners work from home, from a home office. So you don’t actually pay rent in the true sense of the word you use by square footage, and it’s a percentage of so your whole rent won’t be write off your whole utility bill won’t be a write-off, it would still be a portion and then you have to be able to dock into document exactly the mortgage payments or rent payments, utility payments, percentage proof of square footage. It’s not as black and white as you like to think it is. If you are going through the PPP forgiveness, and you are an employer with multiple employees, make sure most tax software I shouldn’t say most accounting software we use QuickBooks, and they have reports already designed in there that we can use for our Schedule-A which is the itemization. Because they asked for each employee, for the last four digits. So security as far as I’m concerned, the dollar amount paid. Then in some cases, if there were over 40 hours or under in the counts as one or half, depending on the total number of employees that worked from what you originally said. So if you have a company that has 50 employees, and last year early in the year, when you use the information for the PPP, and you said you have 50 employees, and you still have to have 50 full-time employees if you said you have 50 otherwise, you could be penalized even if you spent all of the money. If you don’t have the right or the same number of employees or more. You may not be fully forgiven for the total dollar amount, they can penalize you up to 25 or 50%, depending on how far you came down. The reason they extended it for 24 weeks was for you to be able to get your employees back up.
Dr. Friday 29:37
I know it’s a lot to take on the radio because this is a little bit more in-depth. But the most important thing I’m really talking to is not businesses that only got PPP or if the businesses had to lay off their employees and the employees got unemployment. I’m talking to my small entrepreneurs, that in some cases, they got PPP and they got unemployment. That is what we really need to make sure we have for you? So it looks like we have Taylor from Antioch. Hey, Taylor.
Caller 30:12
Yes, I’m here. Can you hear me?
Dr. Friday 30:14
I can now, sir.
Caller 30:16
Okay, I have a couple of questions. I would love to know what forms I need to fill out to fit into my IRA and spouse account so they can withhold deductions on my earnings.
Dr. Friday 30:30
So when you taking your RMD, are you taking required minimum distributions? Or are you just taking money out of your IRA?
Caller 30:37
I’m just taking a required distribution, but I want to hold out all my income, I want them to hold out deductions during the year. That way, I don’t have to pay them at the end of the year.
Dr. Friday 30:54
Right. They’re gonna most likely send you that form. It’s either a W-9, it’s or W-4r actually one of those. It’s just a withdrawal form. I guess, here I’m looking at it. And it’s just the form that they’re going to send with their letterhead, it’s just going to ask you, most likely what percentage you want to be withheld unless you know an exact dollar amount. Most of the time, it’s 10% 15%. Whatever it is that you’re looking to have withheld.
Caller 31:19
Okay, I tried to get forms from them. But they don’t want to if you don’t have a broker, so I just filled out a W-9.
Dr. Friday 31:33
What company are you with?
Caller 31:35
Yes, two or three of them. And then I have stocks also, which would be the same form.
Dr. Friday 31:42
So yeah, according to the I just pulled up Vanguard just to find out because I didn’t know the answer. But they actually do have a distribution form. I don’t know if you’re a computer guy or not. If you are, you can certainly email me and I can copy this form to you. I mean, it’s a blank form that’s on the website here. If you’re not a computer guy, you’re gonna have to get back on the phone and see if they can just mail you an IRA distribution request form and on that form has the amount of money you want to have taken out.
Caller 32:14
All right, thank you.
Dr. Friday 32:16
Thank you, sir. Bye, bye.
Dr. Friday 32:18
Okay, I think have one more person. I think it was Pete. Pete still on the phone?
Caller 32:28
How are you doing? I filed my 2019 tax returns on July the 12th. I haven’t received it yet.
Dr. Friday 32:43
Okay, so you had a refund. But you mailed it like paper mail?
Caller 32:47
Yeah, paper mail. I do have a refund.
Dr. Friday 32:52
It’s gonna be another 30-60 days.
Dr. Friday 32:57
You did a tracking. So you know they received it. But the IRS mailroom was like months behind because of COVID. They didn’t have anybody working there for whatever reason. Apparently, they were afraid they were gonna get COVID from envelopes. I don’t know but doesn’t make a difference. What happened was is that none of the paper if you mailed it by paper, you’re talking at least and I think I’ve said this a month ago, I said “Oh, another 30 days.” So hopefully another 30 days, they’ll have it posted and then they’ll either mail or electronically transfer depending on whatever you selected your money, but it is definitely taking four times longer than what we normally have. It’s ridiculous.
Caller 33:37
Ah, okay. I figured that was the reason.
Dr. Friday 33:43
Good question, and I appreciate it because again when you guys call in asking those questions, it’s so awesome. Because I know a lot of people listening are like, “Wait, I haven’t got my refund either.” So you know, they kind of listen in and just find out when I tell you absolutely nothing helpful, but I do appreciate you calling in and getting at least the question out there, Pete. Even if I don’t have the greatest answer, sometimes it is appreciated for you to make the call. Thank you.
Caller 34:08
One more thing, we’re probably not gonna get another stimulus check. Right?
Dr. Friday 34:12
Well, I mean, I’m thinking we may get another stimulus, but I don’t think it really depends on who wins in November. That’s my suggestion. I think if you know, if the right wins, no. If the left wins, yes, but I’m not too sure who they’re going to be sending it to. So it’s gonna be interesting to find out at this moment. That’s one of the things that they’re kind of when they’re in the office arguing about right. One wants to give out another 1200 the other person wants to make it $600 But both of them seem to want to give something out. Just not sure how much.
Caller 34:47
It’s a shame they argue all the time, they really don’t get a whole lot done. [Laughter]
Dr. Friday 34:51
They do not. If you and I worked in the same way. We would never get anything done. Oh my goodness, we would be yeah, we’d be fired by time. Thank you so much.
Caller 35:03
All right, thank you.
Dr. Friday 35:04
All right. Bye-bye. All right, I do appreciate your calling. If you would like to call the show, we’re going to have one more break, and then that will be it for this. This Saturday. It’s a beautiful day outside. So I think a lot of you guys are probably in your car. But if you want to join this show 615-737-9986. We are taking your calls, talking about taxes, talking about what we can do to resolve our personal tax issues, and making sure that you guys are staying in compliance because without compliance without staying in, and doing just like these people, at least you guys are mailing them in and getting them done. Even if the IRS has dropped the ball. The only good thing I forgot to tell you, is if you mailed it in and it’s post-dated they know you received it, you’re going to get your refund plus 8% interest annually. So you get a little extra money on those deals, but it still doesn’t help replace the money that you’re supposed to get. All right, we’re gonna get right back from this break in just a moment.
Dr. Friday 36:22
If you don’t want to be on the radio, you can always email, or text me, but the bottom line is we have someone on the phone, Kristen. Kristen, what can I do for you?
Caller 36:34
Yes. So in the last two years, I have been the caretaker for my father. In 2018, I did not file so I didn’t make enough money. I live with my partner who is also the father of my child. So he claimed me in 2018, and he submitted his taxes for this year and claimed to me again, and we had to amend because he wasn’t supposed to have done that. Which has put me in a pickle because I’ve never received the stimulus, nor did I receive my refund? And I’m just wondering, am I ever going to see it? I tried to reach out to taxpayer advocates.
Dr. Friday 37:26
They’re overloaded because, yeah, it’s gonna take a while. First, they have to accept his amended return, then you have to E-file your return.
Caller 37:35
I did do that.
Dr. Friday 37:37
Okay. So, you know his amended was accepted?
Caller 37:40
It was accepted, and he received, and they accepted as amended. Nothing on my end and that was four months ago.
Dr. Friday 37:49
Were you able to E-file your tax return? Or did you mail it?
Caller 37:53
I E-filed.
Dr. Friday 37:55
Okay, you did. Well, you sound like you’re a lot like I believe it was Pete that called in earlier where he sent in his back in April or whatever, and he hasn’t received he was by mail. But either way, the bottom line is they may be checking in on yours. If I may ask, did you make a livable wage that year?
Caller 38:14
Yes.
Dr. Friday 38:16
Okay, because in some cases, I think they’re looking into someone that’s trying to claim $2,000 or three, you know, $3,000. And they’re already claimed by somebody else, and may have waived something looking to see if this person actually support themselves? Were they truly able to? But that doesn’t change you. So when you go the irs.gov, and look at it just says no information, or it says they’re reviewing it, what does it say?
Caller 38:43
It just says it this time that there is no refund for me.
Dr. Friday 38:48
Usually, I’ll say they’ve received a tax return, and they’re processing it, or it will say that that is being reviewed, we’ve got two of them that have that little message in there that was received but being reviewed. It should say that they’ve received it and that it’s either being processed, reviewed, or you can have an expected date of your check leaving on this date, or whatever if you’re getting mailed electronically. So I would double-check the irs.gov again and see where my refund is and just see if there’s any additional information. Otherwise, you know, I would call the 1-800-829-1040 and get someone on the phone to make sure your personal tax return was accepted. Even though I know you E-filed it, but make sure it was accepted.
Caller 39:30
Okay, do you think it would help if maybe I sent in a paper form just to have a backup?
Dr. Friday 39:37
I think you’ll probably confuse the IRS if you do that.
Caller 39:40
Okay.
Dr. Friday 39:40
Yeah, we don’t want to do that. No confusion.
Caller 39:43
Okay, thanks.
Dr. Friday 39:45
All right, let’s go phone lines are lighting up. Great. We got Jim in Gallatin. Hey, Jim.
Caller 39:50
Yes, my wife passed away in March. Is there any documentation I need to fill with this year’s tax return to verify
Dr. Friday 40:01
Well, you’re going to need a copy of the death certificate. If there’s a refund, they’re going to want, you know, since you are married, it’s really very straightforward. There’ll be an additional form to issue the refund in your name. Other than that, nothing for the IRS, I’m assuming if she was on Medicare or Social Security that’s already been submitted in a file. From the IRS and tax situation, not really just a copy of a death certificate would be all would be needed.
Caller 40:30
All right. Thank you very much.
Dr. Friday 40:31
Sorry about your loss. Jim. All right. Thank you. All right. Let’s get Joseph in Murfreesboro.
Caller 40:38
Yeah, well, good afternoon. I hope you having a good weekend.
Dr. Friday 40:41
I am.
Caller 40:42
My question is about refinancing my home. I just heard that. I don’t know the numbers, they’re going to be charging a fee for refinancing after December 1. Can you expound on that?
Dr. Friday 40:57
Honestly, you’re the first person that has asked about that. So I don’t know if I can at the moment. I know that the interest rates so low, they may not be making a lot of money on some of these deals. Of course, under the tax code doesn’t hurt a lot of Nashvillians. My Californian’s, it does. You can only really refinance up to 750. For the purpose of tax interest, you can certainly have a bigger mortgage, but I do not know about any additional fees. And if they’re even going to be on the tax code, as far as are we going to be able to write any of those fees off? I would probably say no because they don’t allow us to write off any of our closing costs, fees, or anything. But no, I don’t have a lot on that one. But I will look it up. If there’s something that applies to taxes, I will bring it back on here. Okay?
Caller 41:45
All right. Well, thank you have a great weekend.
Dr. Friday 41:47
Thank you, sweetheart. I appreciate you. Let’s get Rosie in Nashville.
Caller 41:52
Thanks for taking my call. Quick question. For tax planning purposes. I’m retired, my husband still working. But once he retires, and the former RMDs are due to kick in, does it make sense to instead of filing social security at 65, or 66? So before 70, let me say that I was thinking of that for tax purposes, we should live off the 401 K. We’ll try that, and then once the Social Security kicks in, then the RMD and RMDs kick in, then the RMDs will be lower because we’ve depleted some of the accounts.
Dr. Friday 42:48
Well, and they have a couple of options. I will tell you, Rosie this, I will say you probably need to go talk to a financial planner because I think they need to crunch some numbers in a couple of different ways. Social Security in itself is not taxable unless you’re drawing additional money, and that’d be like 35 or 40,000. And then so security could become taxable. Of course, the first 27,000 if you’re over the age of 65 is free money. So we don’t want to not take some but it may be a split between your two scenarios. Maybe you start your Social Security, but you take out a little less or maybe you’re right I have many clients, I deal with Hank Parrot. A lot of his clients come to me and that’s exactly what you said he has gone where they leave the Social Security growing at 8% up to the age, I think it’s 70. And they’re drawing down their 401 K’s or IRAs because they’re at a lower tax bracket right now. So they can take up the first hundred thousand keep it in 12%. That way, like you just said, then they’ll be at a lower tax bracket when taxes are probably going to go up but you know when they hit that 70 break situation. It is a good mathematical theory of what you’re doing. But there might be something in between and then how far do you go? Do you take it all the way up to the hundred thousand marks every year just to keep in and reinvested in after-tax accounts? You know, I’m not a financial planner, but I will be I work with quite a few of them and we crunch numbers all the time under that situation. But I would definitely suggest talking to someone but your mind is on the right track.
Caller 44:23
Okay, yeah, I have definitely talked to someone. But in my mind, I was planning all this. So now, you know coming to fruition. Okay, thank you so much Dr. Firday.
Dr. Friday 44:36
No problem, Rosie. Thanks. All right. I might be able to get Danny if he can talk fast.
Caller 44:43
Hello. I want to thank you for the information you gave earlier on your program. Oh, I guess I’ve heard about a couple of years ago. Where if I got an RMD you can write that if you’re better off, write all of part of your RMD to your donation?
Dr. Friday 45:10
Qualified charitable deduction. Yes, I thoroughly love that.
Caller 45:14
My question is if I want to add to my RMD this year could I just take a portion of, say an IRA and add that to it and get the same deduction?
Dr. Friday 45:27
Yes, IRAs, 401. K’s they all have the qualified if you’re over the age of 70 and a half.
Caller 45:34
Okay. Yeah, I’m well over that. Yeah, that’s why I didn’t know if I could add that portion out of my IRA to my RMD and get the same deduction.
Dr. Friday 45:47
Did you get it? Yes, sir. Good thinking. Yes, you can.
Caller 45:51
Thank you much.
Dr. Friday 45:52
Thanks. All right. We’re hitting the end of the show here. I appreciate all of the calls. If you would like to join or call my office on Monday. If you’ve got questions 615-367-0819 check out the web at drfriday.com. You can also meet up to make a tax appointment or if you just need some consulting just make an appointment through there or email friday@drfriday.com. I hope you guys have an awesome Saturday. The weather is great outside. So go out and enjoy yourself. Call you later.