Your Tax, Estate and Business Resource!

Posted on February 8, 2016 by
  • Are you paying high taxes without knowing why? Understand & pay less. 
  • Are you unsure of your contracts? Knowledge will protect and empower you.
  • Is your family afraid of what will happen if you die? Plan your estate! 

I show you how to save money with ease and effectiveness.

Here’s How:

TAXES: I teach them that it is always Tax Season! Every day of the year there are steps you can take to save taxes, and I can help you with them.

CONTRACTS: don’t take risks and sign agreements that you don’t understand. I negotiate contracts that last because they are win-win. They benefit all parties. 

YOUR ESTATE: you cannot predict when you will need those estate planning documents. God does not ask your permission before he sends you that invitation. So make sure that you have the best estate plan and that you understand it. 

This website shows you thousands of ways to save thousands of dollars. So keep on reading. 

This website shows you thousands of ways to save thousands of dollars. So keep on reading. 

If you are a successful business/property owner or employee I may be the only tax and legal adviser that you’ll ever need. Why? Here is why:

⊗ As a tax attorney, I am more than an accountant. I am your legal advocate.
⊗ As a former IRS lawyer, I have inside experience.
⊗ Instead of telling you what you can’t do, I show you how to do what you want.
⊗ As a former corporate counsel, I understand how to negotiate win-win contracts.
⊗ As your legal mentor, I teach you how to make smart, informed decisions.
⊗ I provide ease and effectiveness in the most convoluted tax and legal areas.

Hire Wis & receive:

  1. Professionally prepared tax returns.
  2. A personal tax plan, generated with my Tax Mastery(c) program.
  3. Tax opinions from a LAWYER  based on Bloomberg Law Tax as well as many other sources of tax law.
  4. A lawyer who can represent you against the Internal Revenue Service. 
  5. Considerate, personal estate plans, wills, and trusts.
  6. Representation before the Shelby County Probate Court,
  7. Seminars for professionals and for everyone else.
  8. My WealthWISe e-letter: regularly updates you on fast moving laws.
  9. Win-win contracts for your business that benefit both parties,
  10. Education, education, education that an entrepreneur needs.

Do not rely on statements on this website without consulting your own tax professional and providing him or her with all relevant facts.

Check out my Credentials and Testimonials

Curious? Contact me today and experience my services free with a *FREE 1/2 Hour Consultation*.  Bring me a tax return or legal documents and get a half hour of risk-free advice plus valuable materials covering your question.

Posted in Business Law, Business Tax, Estate Planning & Probate, Individual Tax, Real estate, investing, Representation before the IRS, Speaking, What's New? | Leave a comment

2018 Tax Summary

Posted on March 14, 2018 by

JOINT STATUS

If taxable income is: The tax is:
 Not Over $19,050 10% of the taxable income
 Over $19,050 but not over $77,400 $1,905 plus 12% of the excess over $19,050.
 Over $77,400 but not over $165,000 $8,907 plus 22% of the excess over $77,400.
Over $165,000 but not over $315,000 $28,179 plus 24% of the excess over $165,000.
 Over $315,000 but not over $400,000 $64,179 plus 32% of the excess over $315,000.
Over $400,000 but not over $600,000 $91,379 plus 35% of the excess over $400,000.
 Over $600,000 $161,379 plus 37% of the excess over $600,000.

HEAD OF HOUSEHOLD STATUS

If taxable income is: The tax is:
Not Over $13,350 10% of the taxable income.
Over $13,350 but not over $51,850 $1,360 plus 15% of the excess over $13,600.
Over $51,850 but not over $82,500 $5,944 plus 25% of the excess over $51,850.
Over $82,500 but not over $157,500 $12,698 plus 28% of the excess over $82,500.
Over $157,500 but not over $200,000 $30,698 plus 33% of the excess over $200,000.
Over $400,000 but not over $500,000 $44,298 plus 35% of the excess over $416,700.
Over $500,000 $149,298 plus 39.6% of the excess over $500,000.

UNMARRIED STATUS

If taxable income is: The tax is:
Up to $9,525: 10% of taxable income
Up to $9,525 but not over  $38,700: $952.50, plus 12% of the excess over $9,525.
Up to $51,850 but not over $82,500: $4,453.50, plus 22% of the excess over $51,850.
Over $82,500 but not over $157,500: $14,089.50, plus 24% of the excess over $82,500.
Over $157,500 but not over $200,000: $32,089.50, plus 32% of the excess over $157,500.
Over $200,000 but not over $500,000: $45,689.50, plus 35% of the excess over $200,000.
$500,000 and more: $150,689.50, plus 37% of the excess over $500,000.


MARRIED, SEPARATE STATUS

If taxable income is: The tax is:
Up to 13,600

Over $13,600  but not over $51,850

 10% of taxable income.

$952.5 0plus 15% of the excess over $19,050.
Over $51,850but not over $82,500 $4,453.50 plus 25% of the excess over $77,400.
Over $82,500but not over $157,500 $14,089.50 plus 28% of the excess over $76,550.
Over $157,500but not over $200,000 $32,089.50 plus 33% of the excess over $116,675.
Over $200,000but not over $300,000 $45,689.50 plus 35% of the excess over $208,350.
Over $300,000 $80,689.50 plus 39.6% of the excess over $235,350.
ESTATES AND TRUSTS  
If taxable income is: The tax is:
Up to 2,550 10% of taxable income
Over $2,550 but not over $9,150 $255 plus 24% of the excess over $2,555
Over $9,150 but not over $12,500 $1,839 plus 35% of the excess over $9,150.
Over $12,500 $3,011.50 plus 37% of the excess over $12,500.

A.    FILING STATUS (single, joint, etc.) controls tax rates, Standard Deductions and many other tax items.

B.      IRA CONTRIBUTION: $5,500; $1,000 catch up contribution for age 50+.

C.      401K CONTRIBUTION: $18,000; $6,000 catch up contribution for age 50+.

D.      STANDARD DEDUCTIONS in 2018 (if not deducting itemized deductions) are:

1.       Joint filers                                               $24,000

2.       Heads of household                             $18,000

3.       Singles                                                     $12,000

4.       Marrieds filing separately                   $12,000

5.       Born after 1/1/53 or blind add            $1,250

6.       +unmarried and not surviving spouse $1,550

E.       ITEMIZED DEDUCTIONS in 2018 are no longer reduced for higher income taxpayers.

1.       Medical expenses for 2018 and 2019 are deductible if in excess of 7.5 percent of adjusted gross in-come, rising to 10 percent beginning in 2020.

2.       State and local taxes. Taxpayer can deduct up to $10,000 in combined state and local income, sales or property taxes

3.       Mortgage interest. The Act grandfathers the treatment of indebtedness incurred on or before December 15, 2017. Mortgage debt borrowed after that to buy a home is limited to $750,000. HELOC interest new or old is not deductible unless used to buy home or improvement

4.       Charitable deductions. No new limits on contributions.

5.       Miscellaneous Deductions are no longer deductible. These include employee job related expenses and investment related expenses like investment adviser’s fees.

F.        Child Tax Credit is expanded from $1,000 to $2,000. The credit begins to phase out for taxpayers with adjusted gross income in excess of $400,000 (in the case of married taxpayers filing a joint return) and $200,000 (for all other taxpayers).

G.      PERSONAL EXEMPTION are no longer deductible

H.      OTHER TAXES

1.       Capital Gains and Qualified Dividends: investments held 12 months and domestic corporation dividends are taxed at lower rates: 0% if you are in 10-15% regular tax brackets, 15% if in 25-35% brackets and 20% for taxpayers in 39.6% bracket.

2.       3.8% Surtax on net investment income applies to the lesser of (a) net investment income or (b) the excess of modified adjusted gross income over “modified adjusted gross income” exceeds $250,000 for joint filers, $125,000 for married separate filers and $200,000 for other taxpayers. Investment income includes interest, dividends, capital gains, annuities, royalties and passive rental income. See Form 8960.

3.       Self-Employment Tax: in addition to your regular taxes, you pay 15.3% self-employment earnings (12.4% Social Security and 2.9% Medicare).

4.       Additional 0.9% Medicare Tax is imposed on wages and self-employment income in excess of $250,000 for joint filers, $125,000 for married separate filers and $200,000 for others. See Form 8959.

5.       Alternative Minimum Tax This 26-28% flat tax applies if it is higher than your regular tax. It denies many deductions, such as state taxes.

Posted in Uncategorized

Tax Reform Business 2017_12

Posted on December 28, 2017 by
Tax Reform lowers the corporate tax rate to a flat 21% and repeals the corporate AMT. Most small to medium corporations are permitted to use the cash method of accounting.
Taxpayers with domestic income from pass-throughs, partnerships, S corporations, or sole proprietorships can deduct up to 20% of profits. Not eligible are certain service businesses like doctors, lawyers, accountants and brokers, with the exception of those with lower incomes.
DEDUCTIONS
Businesses can immediately write off the full cost of new equipment. Businesses can no longer deduct entertainment, amusement, or recreation directly related to the business Taxpayers can continue to deduct 50% of food and beverage expenses associated with operating their trade or business.

CORPORATIONS
The corporate tax rate is reduced to a flat 21%. Repeals the corporate AMT for tax years beginning after Dec. 31, 2017. Taxpayers with average gross receipts of less than $25 million (indexed for inflation) for the prior three taxable years are permitted to use the cash method of accounting,

 PASS-THROUGHS

Taxpayers with domestic income from pass-throughs, partnerships, S corporations, or sole proprietorships can deduct up to 20% of profits. Yes, one person businesses are pass-throughs and include individuals who rent out real estate! These rules have the experts scratching their heads! This is just a basic explanation.

This 20% deduction equals the lesser of QBI or 20% of taxable income. QBI is defined as all domestic business income other than investment income. The 20% deduction reduces taxable income, not adjusted gross income, and eligible taxpayers are entitled to the deduction whether or not they itemize.

As explained below, there are limits on the 20% deduction based on W-2 income, and the 20% deduction is not available to specified services businesses. Important exceptions. Neither of these rules applies to a single taxpayer with taxable income not exceeding $157,500 ($315,000 for a joint return). Above these incomes the rules phase in and apply in full after the single taxpayer’s taxable income exceeds $227,500 or joint filer exceeds $415,000.

Limit on Deduction. The deduction cannot exceed the greater of:
(a) 50% of the W-2 wages paid with respect to the qualified trade or business, or
(b) 25% of its W-2 wages plus 2.5% of the unadjusted basis, immediately after acquisition, of all qualified property. “Qualified Property” means tangible property subject to depreciation under §167, used to produce qualified business income.

Specified Service Businesses. Taxpayers with pass-through income from specified service businesses in the fields of health, law, accounting, actuarial science, performing arts, consulting, athletics, financial services, and brokerage services are not eligible for the deduction. Architects and engineers are excepted.

Example: A lawyer filing a joint return with less than $315,000 in taxable income can deduct up to 20% of QBI.

NEW RULES ON DEDUCTIONS
Entertainment expenses. The Act repeals the current rule that allows the deduction of entertainment, amusement, or recreation that are directly related to the active conduct of a trade or business. No deduction is allowed for (1) entertainment, amusement or recreation activities, (2) membership dues with respect to any club organized for business or social purposes, or (3) a facility used in connection with any of the above items. The Act allows taxpayers to continue to deduct 50% of food and beverage expenses associated with operating their trade or business.
Equipment
Section 179 deduction. If you purchase depreciable equipment in 2017, you may elect to deduct it under “section 179,” including computer software and qualified real property. You may elect to expense up to $510,000 in 2017 (with a phase-out for purchases in excess of $2,030,000 in 2017;
Bonus Depreciation For property acquired and placed in service during 2017 you may deduct 50%.of its cost (less the §179 deduction as bonus depreciation.

My advice:
1. Talk with your tax adviser about what business entity will be best for you taxwise. This question is way beyond the scope of this article. There are already scholarly studies, one by more than ten law professors, on how to deal with these rules.
2. If you are an employee, you can qualify as a pass-through by quitting your job and become an independent contractor. LOL. The IRS will be gunning for this.
3. Maximize your itemized deductions, since taxable income is calculated after itemized deductions.
4. If you are a banned service provider like a lawyer, don’t make too much money. With income less than $315,000 you qualify.
5. Buy equipment in 2017. Choose the best alternative: bonus depreciation, section 1709 deductions, and MACRS depreciation:
6. Buy Vehicles Weighing Over 6,000 Pounds: If you buy and pace in service a vehicle with a gross vehicle rating over 6,000 pounds it qualifies for a §179 deduction of $25,000, plus bonus depreciation on the rest, plus regular depreciation on the rest.
7. Allocate appropriate amounts of State and local taxes remain as business expenses.
8. Reexamine entertainment expenditures that are no longer deductible.

Posted in Business Tax, What's New? | Tagged ,

Tax Reform Individuals 2017_12

Posted on December 28, 2017 by

Tax Reform — the Tax Cuts and Jobs Act (the Act), is effective in 2018 with a few exceptions. In this article, Wis explains some key provisions and makes a few suggestions to save taxes this year and next year.

Look for “IMP” below, marking a number of last-minute important change’s that Congress made in Conference, that you and your tax adviser may not expect. If your tax “expert” is not up to date, consider finding a new one.

To summarize. IMP Individuals will be subject to seven new lower individual income tax brackets from 10% to 37% (see Tax Rates below). Alimony is no longer deductible by the payer or taxable to the recipient. The 0% and 15% capital gain tax rates will apply to higher incomes. Larger exemptions will apply to income subject to the alternative minimum tax (AMT) so fewer taxpayers will be subject to the AMT. The standard deduction increases from $6,350 to $12,000 for singles and $12,700 to $24,000 for married couples. Taxpayers taking itemized deductions will find that all of these deductions are limited or eliminated except charitable contributions. There is no deduction for personal exemptions. The Child tax credit is doubled.

Tax rates are shown below.

Capital Gain rates:  For joint filers, the 0% capital gains rate will apply up to $77,200 taxable income; the 15% capital gains rate brackets will apply up to $479,000 and 20% will be the rate above that. These change points should be half of the above for single filers.

Alimony. The Act eliminates the deduction for alimony payments and does not require the payee receiving alimony payments to include alimony into income. This provision is effective for divorce decrees, separation agreements, and certain modifications entered into after 2018.

Personal exemptions. The Act eliminates the deduction for personal exemptions ($4,050 in 2017).

ITEMIZED DEDUCTIONS.  

Itemized deductions will no longer phase out when Adjusted Gross Income exceeds certain amounts.

Deductible

  • IMP Medical expenses for 2018 and 2019 for medical expenses exceeding 7.5 percent of adjusted gross income, rising to 10 percent beginning in 2020.
  • Interest on existing mortgages borrowed to buy a home. Home mortgage interest on new loans up to $750,000 on new mortgage loans to purchase a home.
  • IMP Up to $10,000 in combined state and local income or property taxes
  • Charitable deductions.

Not deductible

  • State and local income and property taxes in excess of that deductible,
  • Mortgage interest not used to purchase your home (HELOC’s),
  • Employee deductions (miscellaneous)
  • Expenses for the production of income or investments, like investment fees…

Standard Deduction.

The standard deduction increases to $24,000 for joint returns and $12,000 for single filers. You can deduct the standard deduction if it is larger than deductible Itemized Deductions.

Child Tax Credit is expanded from $1,000 to $2,000.

My advice:

I will be offering tax forecasts to my clients so that withholding and estimated taxes properly cover tax liability under the Act.

  1. Taxpayers and domestic relations lawyers must be aware of the after-tax effect of alimony.
  2. Prepay itemized deductions. In 2017 pay and deduct itemized deductions, particularly those that will not be deductible in 2018.
  3. If you expect the standard deduction will exceed your itemized deductions in 2018, prepay 2018 Itemized Deductions in 2017, such as charitable contributions.
  4. Pay expected 2018 Medical or Dental expenses in 2017: fees, complete checkups or any other procedure that will be needed in the next year. Remember that health insurance is deductible, including amounts paid out of social security benefits. Most drug stores will give you a total of prescriptions. All or a part of certain home improvements may be deductible if prescribed.
  5. Choose among sales, income and property taxes to pay as part of your $10,000 limit in 2018
  6. Prepay 2018 property taxes in 2017.
  7. Pay or prepay your state and local income taxes in 2017. Prepayment trap: State and local taxes other than property taxes that are prepaid in 2017 will be treated as paid in the year for which they are charged.
  8. Prepay deductible home mortgage interest. Miscellaneous Deductions (employee, tax preparation, and investment deductions) are deductible in 2017 to the extent they exceed 2% of AGI. Miscellaneous Deductions are no longer deductible in 2018-2025.
  9. In 2017, you may deduct miscellaneous Deductions to the extent they exceed two percent of your AGI. So, before year-end pay or prepay for job-related expenses, investment-related expenses and nonbusiness tax preparation and tax advice. For example, pay for your tax preparation right now. My advice: needed to do your job. Taxpayers with income other than wages will need to adjust estimated taxes and withholding as they go into 2018 so that they don’t end up with surprises at year end.
  10. Expect higher take-home pay in 2018 as employers change withholding in 2018. Adjust withholding to reflect different itemized deductions.
  11. Investors may need to adjust estimated taxes to reflect tax on capital gains, dividends, and interest.
  12. Taxpayers receiving retirement distributions will need to adjust estimated taxes.
MARRIED INDIVIDUALS FILING JOINT RETURNS
‘‘If taxable income is: The tax is:
Up to $19,050 … 10% of taxable income.
$19,050- $77,400: $1,905, plus 12% of the excess over $19,050.
$77,400 – $165,000: $8,907, plus 22% of the excess over $77,400.
$165,000-$315,000: $28,179, plus 24% of the excess over $165,000.
$315,000-$400,000: $64,179, plus 32% of the excess over $315,000.
$400,000-$600,000: $91,379, plus 35% of the excess over $400,000.
$600,000 and more: $161,379: plus 37% of the excess over $600,000.
UNMARRIED INDIVIDUALS
‘‘If taxable income is: The tax is:
Up to $9,525: … 10% of taxable income.
$9,525-$38,700: . $952.50, plus 12% of the excess over $9,525.
$38,700-$82,500: $4,453.50, plus 22% of the excess over $38,700.
$82,500-$157,500: $14,089.50, plus 24% of the excess over $82,500.
$157,500-$200,000: $32,089.50, plus 32% of the excess over $157,500.
$200,000-$500,000: $45,689.50, plus 35% of the excess over $200,000.
$500,000 and more: $150,689.50, plus 37% of the excess over $500,000.

 

 

Posted in Individual Tax, What's New? | Tagged ,

REAL ESTATE, INVESTMENTS WW2017_11

Posted on October 22, 2017 by

First Tax Reform and then we will get into some things you must do to help you this time of year. Tax Reform keeps the 3.8% tax on investment income for higher-income taxpayers. See my Tax Summary. Tax Reform likewise retains the lower rates on long-term capital gain and qualified dividends. This year you can use investments that have lost value to offset those that have gained. If you have margin interest, you can deduct it with certain limits and I can show you how to boost those limits with long-term capital gains and qualified dividends. Read more.

TAX REFORM
What’s Tax Reform going to do to capital gains and dividends? For most taxpayers, Tax Reform will keep the 15% maximum rate on “qualified dividends” (from domestic US companies) and on long-term capital gains (investments held 12 months or more. Tax Reform will likewise keep the 3.8% net investment income surtax on upper-incomers.

3.8% tax on net investment income. This year and under Tax Reform a 3.8% tax applies to the lesser of (a) net investment income or (b) the excess of modified adjusted gross income over “modified adjusted gross income” exceeds, $250,000 for joint filers, $125,000 for married separate filers, and $200,000 for other taxpayers. Investment income includes interest, dividends, capital gains, annuities, royalties and passive rental income.

Investment losses. Don’t cry about those losing investments. Sell them and sell investments that have increased in value to offset the capital gains. If you have more losses than gains, you can deduct up to $3,000 of the excess losses against income other than capital gains. You can carry-over unused capital losses. If you have losses in investments that you want to keep you can buy them back, but you must wait more than 30 days for the loss to be effective under tax rules.

Investment interest. If you have investment interest such as margin interest you can deduct it to the extent of net investment income. I can show you how to use long-term capital gain and qualified dividends to deduct the margin interest.

I could go on. Come in for a free 1/2 hour consultation to find out what will help you

Posted in Uncategorized

Estate Planning 2017_11

Posted on October 22, 2017 by
WANT IT EASY AND EFFECTIVE?
Let’s talk about Tax Reform and then talk about what you need to do the rest of this year. Tax Reform proposes to END the federal estate tax. Finally, estate planners can concentrate on family concerns instead of taxes. When I do estate planning I follow my motto, ease and effectiveness. That means it is quick and economical for you. How can I accomplish that? I am an Accredited Estate Planner. I have taught Microsoft Word and Excel professionally. As corporate counsel for a national software company, I earned certificates in Visual Basic, the software that runs Microsoft Word and Excel. So I program Word and Excel to produce documents to do what you want. I do not send you home with two inches of documents that you don’t understand.  My approach benefits and protects you. 
I create your documents quickly and accurately, using provisions some of which I developed with my father, a former Probate judge. Using VBA programming, I enter client information and with the mere push of a button, the program enters clients’ names and information almost magically into Trusts and other estate documents. With the programming, I search out keywords and replace them. I check documents for spelling and grammar.  I don’t use a paralegal. That means you don’t have to pay for a paralegal and you don’t have to put up with their mistakes. As a licensed lawyer and Accredited Estate Planner, I understand my documents and the law.
Some lawyers pay high prices for document assembly programs created by out of state “experts.” Their paralegals use these programs to create massive documents designed to work under every possible circumstance. This means that you end up with language covering a business whether or not you have a business. These documents come in large notebooks with large prices.
As large and expensive as these documents are, they are only as good as the person that makes them. If most of the work is done by a paralegal, it is tempting to rely on the paralegal and not review the document carefully. For example, I reviewed one of these impressive notebooks in which a child with mental disabilities was to receive half of his mother’s estate outright when she died. This was not communicated to her and she did not intend it. She intended that his share remains in trust where it could be protected by the trustee. I corrected it for her. Don’t let this happen to you!
If you are ready to design your estate so that it is easy and effective for you and your family, select RLT Organizer.
Posted in Uncategorized

Mind your Business 2017_11

Posted on October 22, 2017 by

MORE THAN JUST TAX SOLUTIONS
Again, let’s discuss Tax Reform and then I will tell you ways to help your business the rest of this year. As a former corporate counsel and former IRS attorney, I can be your one-stop professional. I can draft your contracts and advise you on their tax consequences. Right now, I am working on business purchase contracts for clients.
I am forming LLC’s and telling clients why not to form an LLC. Purchases and sales of businesses or equipment should be carefully planned to avoid unfavorable tax and legal consequences. Find out more.

TAX REFORM. Under Tax Reform, most likely in 2018 there will be a 25% maximum tax rate on sole proprietorships, partnerships, and S corporations. There is a chance of an unlimited deduction for depreciable assets other than buildings effective in September of 2017. If you have this option, you will have to decide if you are better off deducting it now or later. It will be wise to get a professional tax forecast so you will know your effective tax brackets this year and in the future.

Purchase or Sale of Business or Equipment. If you ell equipment and you have written off all of its cost, you will have tax consequences. Think about instead making a tax-free exchange. Or you could delay the tax with an installment sale. If you are buying or selling a business, I could easily write a book on it. Think about noncompetition provisions, non-solicitation provisions, confidentiality, warranties and more.

YEAR-END PLANNING. Check with your tax professional and do some year-end planning. If you are a cash basis taxpayer and will be in an equal or larger tax bracket this year than 2018, pay some of your 2018 expenses, like insurance premiums, this year. Delay some billing.

WILL YOU BE AUDITED? What are your chances of getting audited? My TaxMastery© program tells you the average deductions for taxpayers in your income range. The IRS has announced that it is an audit red flag when taxpayers have lots of wage income but report lots of Schedule C losses especially if the loss activity sounds like a hobby. A recent Tax Court disallowed losses from film festival marketing where the taxpayer had no business plan and poor records.
My advice: act like a business if you want to be treated as one for tax purposes.

Give me a call. Get a free 1/2 consultation.

Posted in Business Law, Business Tax, What's New?

Individual Tax Tips 2017_11

Posted on October 22, 2017 by

Let’s talk a little about Tax Reform and then get into some things you should do this time of year. Tax Reform should overall benefit individuals with lower tax rates and higher standard deductions although specifics are uncertain. It looks like many taxpayers in 2017 will be able to turn sales tax, charitable contributions and employee job expenses into GOLD. I am talking about saving thousands
of dollars in taxes. My Tax Mastery© program identifies these deductions for you and tells you how to get them. Once you have secured these deductions, you can adjust your withholding or estimated tax payments so that you have more take-home pay.

TAX REFORM: Under Tax Reform larger standard deductions will benefit many taxpayers, $24,000 for married taxpayers filing jointly, and $12,000 for single filers. The initial tax reform bill would eliminate itemized deductions other than home mortgage interest and charitable contributions. This means no deductions for medical costs or employee expenses, Fedex pilots. I predict that Congress will keep the deduction for state and local taxes but phase it out for larger incomes.

Tax season is never over. You have to act this time of year to get tax benefits. There are many deductions that you cannot use at all unless you are “Itemizing your deductions.” You can itemize if your Schedule A deductions (medical, tax, mortgage, charitable, employee, and investment) exceed your “standard deduction” ($12,700 for joint and $6,350 for singles). See my TAX SUMMARY_2017.
Once you pass this threshold the effect of these deductions starts to add up.

My advice: Don’t be lazy. Keep records to support your Itemized Deductions. My Tax Mastery© program identifies deductions and tells you what they will save you.

The IRS “gives” you an estimated sales tax deduction from a table, but my experience shows that it is half of what most taxpayers actually spend. So keep receipts for all your sale taxable purchases, especially vehicles or home improvements. The State of Tennessee has a sales tax on just about everything.

For example, one of my favorite clients came in with receipts for over $200,000 for an addition to their house. They saved more than $7,000 in taxes! You don’t have to add up these receipts. Use your credit card and bank statements to estimate a conservative amount. Save the receipts in case you are audited.

Keep receipts for charitable contributions, especially clothing and household items. If you were recently married or moved, don’t keep everything you both owned and don’t tell me you gave only $450 to charities. I can show you how to value and record these items. Use my Charitable Contribution Record.

Miscellaneous Deductions.You cannot deduct Miscellaneous Deductions unless they exceed 2% of your Adjusted Gross Income. With Tax Mastery I can show you the additional employment and investment deductions. Are you missing investment fees hidden at the back of your investment adviser’s statements?

Once we find and get proof of all of these deductions, it is Christmas time! Want some tax free cash? I can show you how to adjust your federal withholding so you take home those tax savings between now and the end of the year in the form of more take-home pay.

Posted in Uncategorized

WealthWISe updates

Posted on October 1, 2017 by

In my e-letter, WealthWISe, I report on the latest important items in my fields. Be sure to sign up for WealthWISe so you will receive your personal copy as soon as it comes out.

Posted in Uncategorized

REAL ESTATE, INVESTMENTS WW2017_8

Posted on August 6, 2017 by
EASY AND EFFECTIVE TAX TIPS

Avoid gain on older stocks. One of my new clients, Serena Stockholder, is a Federal Express employee and loves to buy Federal Express stock. As a result, she has stock that has been purchased over a number of years.

One day as we sat and reviewed her tax return, which I was preparing, she bemoaned the fact that she needed to sell some of that stock but the older purchases had low costs so she figured she was going to have to pay some capital gains taxes. I tipped her off on two easy ways to lower that gain. Read more.

First, normally the first-acquired shares are treated as sold first. However, if you identify the shares sold, you can select the shares with the highest cost to minimize gain. For this to work, you must tell your broker and get confirmation of what shares to sell receive in writing. You may also issue a standing order to always sell the stock with the highest basis.

Second, under a little-known rule, if she contributed appreciated shares with a low basis to her favorite charity, she would be entitled to deduct the current value of the stock and would not have to pay any taxes on the gain.

My Advice: It is almost always a good time to make an appointment with me and do a little tax planning. Had Ms. Stockholder sold her stock without knowing what I told her, she would have paid way too many taxes. The best thing to do is to send me your most recent tax return and let me put Tax Mastery© to work. That way you can assure that you pay the least legal taxes in 2017. If you are considering any significant transactions, I can use my Proseries software to tell you exactly what your 2017 taxes will be and how we can reduce them. If you are not yet a tax client, you are entitled to a *Free 1/2 hour Consultation.*

Next Wealthwise: I will tell you how to avoid the passive activity loss (PAL) rules without being a real estate professional. Hint: most Airbnb hosts avoid PAL.
Posted in Real estate, investing, What's New?

INDIVIDUAL TAX TIPS WW 2017_8

Posted on August 6, 2017 by

Summer is no vacation for you or is it?

Tax season is never over. You have to be vigilant for tax benefits. For example, one of my favorite couples, Dr. and Mrs. Med, live in Nashville and they have three kids. Mom and Pop are employed as MD and pharmacist, so they must find something for the kiddies to do while the parents work. Summer camp is expensive. They typically owe taxes with their return. What can they do?

Here is how it works. If your child is age 12 or under and attends summer camp (not summer school) so you can work, you can take the dependent care credit. The credit is 20-35% of the cost on up to $6,000 with two or more children. The percentage drops as adjusted gross income increases over $15,000. So even in this case where the parents make good money, they get to take a $1,200 tax credit – that is a credit, which directly reduces their taxes.

Withholding trap. Let’s look at another TRAP faced by Dr. and Mrs. Med and many hardworking couples. They can’t trust their employers’ withholding. There are two traps:

First, where a couple is both employed, their combined incomes push their taxes up but each employer is not aware and doesn’t withhold enough leaving them owing a sizable amount on their tax returns.

Second, on the other hand, a taxpayer that is deducting sizable itemized deductions, like real estate taxes, mortgage interest, contributions and more, can end up with a large refund, which you could have used to increase your monthly checks.

Tax advice: Try my Tax Mastery© program. With it, I can show you how to lower your taxes with those deductions and adjust your withholding so it matches your taxes. Likewise, my Tax Mastery© program tells you what the average deductions are for your income so you can avoid an IRS audit.

Posted in Uncategorized