Tag Archives: tax

Fast January, Tax Audit Pre-View, “AO” … Friday

Not sure about you guys, but in several conversations this week, as well as a few reflection times, it was super hard to believe January is almost gone… Wow!

Speaking of Fast January, how about already another Friday… with a short week and turn around travels next week, looks like we are in full stride….

Tax Time Commeth

Given the mailbox (and inbox) is likely beginning to fill with those pesky tax forms, we have a few neat stats on Tax/Audits/IRS reviews to share soon… We actually attempted to get them into the Q1 2020 Newsletter to no avail… a good problem (too much content) … We think you may find some of the statistics very interesting, but of course never push the gray when dealing with Uncle Sam!

Here is a Teaser:

TaxAudit 2018 stats

AO – Australian Open

Regular readers know sports … and especially Tennis (Australian Open) is big at the homestead…. between a 17 hour + time zone change and the 15 year old deciding to do 6 am — YES … 6 am tennis practice, the candle has been burning a bit at both ends…. maybe the reason for the Fast January… all good!

Ahhh….but as mentioned early, today is a Friday…maybe a Fast Friday in January, but still a Friday … enjoy your weekend and get ready for some fun Tax Facts Next Week!

Have a Great “Fast Friday” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
jkfinancialinc
street-cents

Q 1 2020 Extended (12 Page) Newsletter Video Audio Podcast Review By John Kvale

Welcome to our Video and Audio Podcast Review of our Q 1 2020 Newsletter. For those on the road or just unable to grab the time to read, our podcast type review gives you the behind the scenes insight to our thoughts, observations and deep views of the entire Newsletter.

Click Here for direct link to an electronic version (an early peek-good ole fashion paper versions are on their way to you shortly) and here for our Newsletter page

Let’s get going!

All New Pictures, Intro and Exit Music !

Q 1 2020 Newsletter

Click for PDF/Printable Version

 

Is Inheritance Taxable ?

This, our lead financial planning article for the newsletter-  With the subject of inheritance and the taxability of it occurring multiple times in the most recent quarter, the idea for this article spawned.

After completing the initial article, a continuation article idea also occurred which made the second part of the inheritance subject matter about being separate property.

We hope you enjoyed both articles and this was our lead financial planning articles.

All about the Car

In another fun personal financial planning two – part article, long desired, but fearful of writing …this article discusses the car, should you buy or lease and how to do so. Again, a second article occurred at a chance meeting in an airplane with a former law officer watching me finish the first article on the airplane!

In doing the research for these articles we ran across a really cool car research site, and mentioned some great buying resources as well.

Recession Thwarted – Capital Market Thoughts

To ignore new evidence in our minds is silly even if it goes against the grain of what you may have been saying!

In this article we review a CFA speaker’s slide about lowering rates during a recession and his conclusion. Bottom line, we’ve not been a big fan of lowering rates during economic growth, but an inverted yield curve which is highly predictive of a coming recession, along with lowering of rates, according to the speaker and the enclosed chart leads to a thwarting of the recession.

We hope we are wrong on this one and the speaker is correct!



Reach back to last year’s taxes in savings you can do now

In this article we discuss the remaining tax savings ideas that we can do this year, that will help last year’s taxes-

  • The SEP – Simplified Employee Pension
  • HSA – for the Health Savings Account
  • IRA – An oldie but a Goodie if it’s available to you
  • Roth – While not a tax saver you can do it now for last year’s taxes
  • Itemized itemize itemize – With today’s high standard deductions you may not be able to itemize but we remind that it’s a good idea to stay in shape as it’s likely these itemize deductions may come back in the future

We hope you enjoy … talk to you in the Spring !!!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

End of Year Tax Reminders! Tick Tock

While there are a fair amount of tax techniques that can be used next year to reach back to this current year, since this is the last Newsletter of the year we wanted to remind of a few timely tax reminders.

Is your DOB between 7-1-48 to 6-30-49?

Then you turn 70.5 in 2019 and you CAN defer your RMD until 2020, however you will have two RMD’s next year — be careful, large distributions could toss you into an extra tax bracket.

The mandatory commencement date of RMD’s is the year AFTER you turn 70.5 years young, under current tax law. If you accept this first year deferral, you will incur two RMD’s in the year you commence your first RMD.

Depending on the situation, it may be advisable to distribute your first year RMD a year early so as not to clump your taxable distribution.

401k and other Company Retirement Plans Maximization

For 2019 the maximum 401(k) contribution is $19,000, if you are 50 or over you can put an additional $6000 making a total of $25,000.

Now is a good time to check and make sure you’re on schedule to maximize your deferral, especially if your age 50 or over and extra especially if you turned 50 this year, we find that employers sometimes need a nudge to allow us to do that extra $6000 catch up provision.

529 Distributions or Contributions

Contributions and distributions should be made by the end of the year for this fiscal year as there is no look back feature on 529 plans. Distributions for this years education expenses should be made this year, allowing a matching of expenses with distributions in the same year.

Charitable Donations 

Make your donations by year end if you want to take a charitable deduction this year. Charitable donations are not allowed any look back, and as such must be made by the end of the year if you wish to deduct them on this year‘s taxes.

Well there are a fair amount of look back tax deductions, many of which we will discuss in the next newsletter and after the turning of the new year,  these tax deductions have an ironclad ending date, which is the end of this year if you wish to meet the deductibility requirements.

You have plenty of time now, but the clock is ticking!

Have a Great “End Of Year Tax” Reminders Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
jkfinancialinc
street-cents

Tax Update – Reminder busiest wire day of the year – Friday

With a full girth of tax returns under our belt now, the general gist is there are winners and losers – but it is very difficult to pin the success or the lack of success on any one reason.

Thanks for the Thanks – Happy to Do Our JobUncle Sam

A special shout out and thank you to all of those who have thanked us for getting their tax information to them or their tax professional in an expedited manner – Our theory on this is if someone’s working on your return we want it to stay at the top of the pile, hence we try and get the documents in lightning fast fashion!

Again you are all welcome but happy to do our job and hopefully cut down on the inevitable start and stop mistake!

Wire Reminder

Speaking of taxes – the busiest wire day of the year is tax day – Certainly understand the desire to wait to the last minute – weight that option with something going wrong on the busiest day of the year!

Spring Has Sprung

Today is a Friday and it’s finally getting warm at least here in the south.

Enjoy your weekend, we will stay alert for tax questions through our electronica tether.

Don’t forget to spend time with those special in your life!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
jkfinancialinc
street-cents

They are back … The Fraudsters that is !

This time garners the most important financial forms of the year flowing through the system … of course we are speaking of Tax Forms! (W-2, 1099, etc …..)

Tax Time = Fraudster Timethief

This week we fielded two and 1/2 possible fraud attempts. We are giving 1/2 to a email that we are not certain was fraud … No Matter.

Keep your guards up!

Last year we had double digit numbers of fraud during this season… the thing is, we did not see fraud until much later in the season. They may be starting earlier this year.

For the record, there has been no money lost on any of our known fraud attempts… we hope this never changes…. Stay Vigilant !

Happy Friday .. Enjoy Your Weekend ! Talk to you next week…

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

Confusing Tax Form 5498 Explained

Just when we all finally think it is safe to get out of the tax waters (Jaws reference haha) our good old friend, Form 5498, arrives in the mailbox.

What is Form 5498?2017 F 5498

This form reconciles qualified deposits.

Examples include:

  • Confirmation of 401k rollovers
  • Confirmation of IRA contributions
  • Proof of Simplified Employer Pension (SEP) plans contributions

Why does this form come in May? 

Since this form reconciles rollovers and also proves deposits, this form comes AFTER tax season. This form proves the amount contributed IN THE YEAR is was made, said another way, if we make a SEP deposit in the current year for the prior year, Form 5498 shows the deposit in the year it was made and the IRS knows there may be a delay.

What do I do with this form?

Keep it and file it with your next years (current tax year) information. It will correctly reconcile your IRA/401k transactions.

Have a great “Less Taxing Day”!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

Taxes are Done… Finally … A Few Tips to Remember Before Sticking that Information Back into the Files

After each tax season we always feel relieved, as the pressure builds slowly but surely, much like the frog in the boiling water. This story has a better ending.

Taxes are done!

Here are a few tips that are hot of the presses and good reminders for NEXT years taxes!

HSA’s are Great, as is all pre-tax medical savings plansUncle Sam

If you can do an HSA, do one. If you are not sure, reach out to your employer and find out if you qualify, they will know in very short order. Don’t worry about using all of your HSA during the year, you will eventually need the funds for medical expenses.

We prefer HSA to the FSA’s or other plans that may expire annually. However, all pre-tax plans for medical expenses are great. When using the FSA or other “use it or lose it” type of plan, just make sure you do use it and do not let those hard earned dollars expire as the calendar turns to a new year.

Max that 401k

Now is a great time to make sure you are maxing your retirement plan. Do it evenly if possible! In a perfect scenario you likely want to run out of contributions in late November or early December. There are situations such as retirement, job change or other that may make it more appealing to fund early.

Do not overfund your 401k. This can be done via a job change or plan change. We have a more comprehensive article coming soon, but be reminded we do not want to over fund our 401k plans.

New plans can be aggressively invested. As the amount grows, the portfolio should be slowed down and be better diversified for the long term.

You Owed a bunch

If you owed a large amount of money and this is occurring repeatedly, it may be time to adjust your exemptions on for your employers W-4 records of your personal exemptions. Determine what your exemptions are currently and make an adjustment down in number. After your next paycheck, extrapolate the adjustment and see if that will cover your liability. Reach out to us if you need help!

Extension Filers

If you filed and extension, keep your feet moving, especially if you had large transactions or other items that may throw you into an “owed” mode. The longer you wait the more the penalties will be if you are caught by surprise.

Relax and enjoy the rest of the week and the full speed ahead into Summer !

You deserve it!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com