“Real World” Personal Strategy Blog

Dreaming Big Must Come Before Financial Planning by Roger Menden

Financial PlanYou’d probably be surprised if you sat in on some of the meetings I have with some of my tax planning and preparation clients.

This is by no means the majority of my clients, but there is certainly a good subset of people who have piled away a ton of financial resources … but who are bored, tired and a little numb.

And, of course, there are those among my Shakopee, MN clientele who have not yet reached the financial (or otherwise) zenith they’ve been working so hard towards, and yet they are still stuck in the grind of “everyday living”. Often, they haven’t taken the time to re-assess whether or not what they’re shooting for is, in fact, the place where they will be most alive.

They haven’t taken the time to dream. And, more importantly, they haven’t put a concrete plan to whatever dreams they might have had in earlier days. They’re dragged around by their nose by whatever circumstance comes their way.

Maybe “they” is you?

It’s never too late.

Before I get there I did want to urge you to consider something in light of this past year’s tax return: adjust your withholding.

You’ll want to do this by submitting a new W-4 to your payroll office regardless of whether you got a big tax refund this year or ended up owing Uncle Sam some money.

Ideally, you want to pay in through withholding (and estimated taxes for some of us) as close to your eventual bill as possible. That will mean you will have your money in your hands throughout the year, instead of having to wait for the U.S. Treasury to cut you a check or directly deposit the money.

It’s a small thing, but it makes the tax process so much less painful.

Now, assuming you’ve got your withholding where you want it to be, let’s talk about avoiding that numb haze I’ve seen so often.

In fact, why don’t you consider printing out this note, shutting down your computer, and doing a little dream-planning right now?

Here’s a suggested format…

Dreaming Big Must Come Before Financial Planning by Roger Menden
“Life can only be understood backwards, but it must be lived forward.” -Soren Kierkegaard

Get a piece of paper and make a list of all the things you want to do during your lifetime–no matter how crazy or undoable some of those things might seem. If you want to go on an African safari and become a famous gorilla researcher, then write it down. If you want to sip coffee at a Left Bank café in Paris, then by all means, put it on your list.

Include all the seemingly mundane things you want to do, too. Do you want to spend more time with your children, your spouse, or your parents? Write it down. Don’t hold back. Be as wild and daring as you want to be. Let yourself dream big.

Once you have finished the above exercise (and not necessarily in the same sitting) take another piece of paper and ask yourself, “If I had a million dollars in the bank that was exclusively for me–and I had no responsibilities and knew I would not need the money in the future–how would I choose to spend a perfect day?” Maybe you want to write a novel, talk to a friend, or own a ranch and raise goats. Whatever it is, write out your perfect sort of day. These are not necessarily the big event things you want to experience, but your idea of your perfect day of living. Again, don’t hold back.

People are often surprised at how powerful these two exercises are.

How do they help you?

They help you know what are your ACTUAL big dreams. They help you see clearly where your priorities reside. And they help you see how far away you are from, or close you are to, your dreams and your more ideal daily existence.

And once you know that, then you can lay out a plan that lets you use your precious time for what you really want in life.

This can be really fun, if you let it be so. Shut off your cynicism, take fifteen minutes … and send me an email about your experience with it. 

I’d love to help you formulate a financial plan to get there.

Warmly,

Roger Menden
952-445-8753

R. Menden Accounting & Tax Service

How To Buy Happiness In Shakopee, MN

Buy HappinessNot a huge amount of “tax news” these days … we’re watching Congressional movement on tax reform, Obamacare, etc. but right now, it’s all mostly just talk.

But that’s politics, I suppose. Which is a good argument for not diving too deeply into it.

Now … moving to things far more immediately relevant: I’ve written before about the surprising disconnect between significant means and deeper joy. That is to say, that one doesn’t always bring the other.

And wouldn’t you know, apparently it’s science.

I thought you’d be interested in the research I recently came across, because it’s more than just an “ooh, that’s interesting” kind of finding — but I believe that it can actually be applied to your daily life in order to maximize joy. Some of my Shakopee, MN tax clients with significant means may already be aware of what we’re talking about today, but in my opinion, this reality is true regardless of how many zeroes are in your bank account.

So, as we work with you to consider how we are able to best preserve your wealth from the grasping hands of the IRS and various state authorities, I think it it would be worthwhile for you and your spouse or partner to consider these dynamics.

How To Buy Happiness In Shakopee, MN
“A mind, like a home, is furnished by its owner, so if one’s life is cold and bare he can blame none but himself.” -Louis L’Amour

It turns out that the conventional wisdom is wrong: it is possible to buy happiness — when you spend your money on others. Researchers at the University of British Columbia and Harvard University have found that people who buy gifts for others and make charitable donations report being happier than people who spend their money primarily on themselves.

Here are the details of the study they conducted…

The scientists studied 630 Americans and asked them to rate their general happiness, their annual income, and their monthly spending — including bills, gifts for themselves, gifts for others, and charitable contributions. Researchers also measured the rates of happiness for people who received profit-sharing bonuses from their employers of $3,000–$8,000.

Again, the researchers found that it was not how much money the participants received that predicted happiness levels, but rather how the recipients spent the money. Those who donated more of their bonuses to charity or used it for gifts for others rated themselves as happier than those who did not.

In a third look at this phenomenon, the researchers gave participants a $5 or a $20 bill and asked them to spend it before 5 p.m. on the same day. Half were given the
instruction to spend the money on themselves, half to spend it on others. The half who spent their money on others reported feeling better at the end of the day than those who didn’t. And this was regardless of the amount.

The researchers say that even spending a small amount on someone during the day can significantly improve our feelings of happiness.

So I ask you — what will you do with this information?

Warmly,

Roger Menden
952-445-8753

R. Menden Accounting & Tax Service

Roger Menden’s Three Ways To Live Out Your Retirement Lifestyle In Advance

Retirement LifestyleFirst off, now that May is upon us, we’re moving into a different mode. We have a few clients on extension (and with whom we will continue to correspond), but our attention is now more turned to other matters: tax planning (more about that soon), working with Shakopee, MN businesses and other individuals with year-round concerns, and other such things.

Many Shakopee, MN tax businesses don’t provide this service, but even though we’ve completed most of our clients’ returns, we WILL review any non-clients’ or new clients’ (including your friends’) previous years’ returns — at no charge.

Secondly — did you see the news about President Trump’s proposed tax reform?

Big stuff, if it passes … but it faces a skeptical Congress (including some in his own party who have deficit worries), a public who isn’t quite sure if it will happen, and, of course, the lobbyists for various interest groups who don’t want to see their particular favorite deductions go up in smoke.

If there is actual legislative progress on these proposals, I’ll be sure to keep you posted — in the meantime, I suggest you adopt *my* policy on such things: look for the actual action, not the PR. We’ll see what happens, if in fact something does.

Because future-casting is always a little tricky, I’ve found, when it comes to financial questions. The “numbers”, of course, are fairly easy for me or someone on my team to get a handle on. But when thinking about retirement, in particular, there are many things beyond the numbers to consider.

And I’m not convinced many financial counselors or advisors take all of it into consideration.

Roger Menden’s Three Ways To Live Out Your Retirement Lifestyle In Advance
“Life is like music; it must be composed by ear, feeling and instinct, not by rule.” -Samuel Butler

People over 40 shouldn’t just plan for retirement, they should rehearse for it.  Because retirement can last 20 to 30 years, it’s more important than ever that “pre-retirees” (those who plan to retire in five to seven years) practice how they want to live without work as the organizational focus of their lives:

1. Try out different retirement lifestyles.
For example, many people dream of selling the family home and traveling in an RV or going abroad. Practice this by renting a camper and going on the road for a long vacation. You may discover that travel is exhausting or boring to you.

The same holds true for relocation dreams. Rent a home where you think you may want to retire to see if it really is where you’d like to move. The weather may not suit you, or the community may not be your cup of tea. Work out these details before you commit to an expensive change.

2. Live with your spouse 24 hours a day.
Most couples spend much of their early years working and, thus, spending much of their time apart. It may take some time to get used to the other person’s schedule, habits, and routines.

3. Practice living on that retirement budget. 
Most retirees’ income is significantly less than their preretirement income. Add up all the Social Security benefits, pension income, and 401(k) and IRA savings to calculate what you can realistically expect to live on each month. Then live on that amount for a month to determine what changes, if any, you need to make to your plans.

Warmly,

Roger Menden
952-445-8753

R. Menden Accounting & Tax Service

Tax Freedom Day And Amended Tax Returns For Shakopee, MN Taxpayers

Amended Tax ReturnWhen I say, “3.5 months of labor,” I’m not actually referring to the work we do here in our Shakopee, MN tax office on behalf of our clients. (Frankly, we work the entire year so that these past few months would NOT be as crazy as they might otherwise be.)

Nope, I’m referring to one of the big dates we mark every year around here: “Tax Freedom Day“. It’s the date when the nation as a whole* has earned enough money to pay its total tax bill for the year.

(*I say “as a whole”, because this is only a collective average and does not accurately reflect the number for you or for  your neighbors — it is the average tax burden for the overall economy, rather than for specific subgroups of taxpayers.)

This year’s magic date was Sunday, April 23, 2017 (which is one day earlier than last year, for what it’s worth). 3.5+ months into the year. And, as in years past, Americans will collectively spend more on taxes in 2017 than they will on food, clothing, and housing combined.

Amended Tax Return

That’s a sobering reality — but for me and my team, it is a helpful reminder for why we do what we do: We are about keeping your tax bill as low as legally and ethically possible.

Now, with that aside, if work on your return has been completed and you are not on extension, hopefully YOU have complete confidence in how things landed with your return this year. (If not, please do send me an email, and we can set up a time to discuss.)

But what about your friends?

Tax Freedom Day And Amended Tax Returns For Shakopee, MN Taxpayers
“Friendship is like money, easier made than kept.” -Samuel Butler

Our Shakopee, MN clients who filed with us this year already feel the peace-of-mind that they were able to claim every possible deduction which is legally allowed in the tax code for 2016. After all, we put each return through an extensive review process to ensure you keep as much of your hard-earned income as the IRS allows.

But what about your friends? And what about your previous years?

Well, since the filing deadline has already passed, they (and you) might think that the proverbial “fat lady” has sung on 2016 returns (and 2015 and 2014). Not so.

Because according to the most recent report on the matter, issued by the General Accounting Office, taxpayers overpay the IRS over $1 billion every year due to incorrect itemization and preparation.

What’s worse is that those who prepared their own taxes (with a software or on their own) are the most vulnerable, according to the report. But did you also know that taxpayers who used one of the “big chain” preparers are almost as bad off?

An excerpt from an additional report from the GAO: In a Limited Study, Chain Preparers Made Serious Errors

In GAO (United States “Government Accountability Office”) visits to chain preparers, paid preparers often prepared returns that were incorrect, with tax consequences that were sometimes significant. Some of the most serious problems involved these preparers…

1.  Not reporting business income in 10 of 19 cases;
2.  Failing to take the most advantageous post-secondary education tax benefit in 3 out of the 9 applicable cases; and
3.Failing to itemize deductions at all or failing to claim all available deductions in 7 out of the 9 applicable cases.

More clippings from the report:
* The 19 paid preparers we visited arrived at the correct refund amount only twice. On 5 returns, all for the plumber, they understated our refund amount by a total of $3,465.

* All 19 of our visits to tax return preparers affiliated with chains showed problems. Nearly all of the returns prepared for us were incorrect to some degree, and several of the preparers gave us very bad tax advice, particularly when it came to reporting non-W-2 business income. Only 2 of 19 tax returns showed the correct refund amount, and in both of those visits the paid preparer made mistakes that did not affect the final refund amount.

So what can your friends do about this? And what could YOU do about it, if you didn’t have us handle your taxes in prior years? Simple: file an Amended Tax Return.

Many tax businesses don’t provide this service, but even though we’ve completed our clients’ returns, we WILL review any of your friends’ returns — at no charge.

Warmly,

Roger Menden
952-445-8753

R. Menden Accounting & Tax Service

A Tax Day Thank You From Roger Menden

Tax DayLifting my heavily-lidded eyes to peer up through the haze of government forms and procedures, I peek at the calendar, which today said: April 17.

(If any of the above sounded slightly poetic, that’s the coffee talking; I’m a Shakopee, MN tax accountant, after all.)

Yes, today is an extremely busy day for us here at Team Menden — it’s the day before the big deadline (Tax Day = Tuesday, April 18th, 2017). But as I am a person of ritual, I’m still taking the time to write to you on this, of all days. (Though you are likely to be actually receiving it later in the week, depending on how this day goes!)

It’s been a great tax season — and for us, it’s not really ever over.

Yes, we will have a respite because individual filing (and a slew of other things) are due tomorrow, but we don’t take the same kind of extended vacation of which many of our colleagues avail themselves upon tax season’s completion.

But this week gives me the chance to say (again): We are extremely grateful for your trust, and all of the other Shakopee, MN area families we got to meet with this year for tax preparation.

It’s always been our hope that we take a process that is so painful and time-consuming (with so much waste), and convert it into a profitable enterprise (for YOU) through smart tax preparation and planning and in overall financial coaching for our clients. We’re proud to say that we have seen those good stories this year, as we’ve continued to grow on the strength of your referrals.

I won’t be sharing strategic personal financial wisdom today (I hope you’ll forgive our needing to stay focused), but I would like to make one last request:

If you have filed your taxes with us would you…

A) Write something of your experience for people to know about in the future? Yelp and Google seem to be the place where many Shakopee, MN people are looking these days, and your words there would mean a great deal…

(And if for some reason you weren’t satisfied with our service, please write me back personally. I will do everything within my power to make it right, and will make it a priority, even this week.)

B) Share us on YOUR Facebook wall…?

Here’s something you could post on your profile, if so inclined:
“I had my taxes prepared by Roger Menden’s team, and had a great experience. And even now, they’re willing to review your tax return to make sure that everything was done right for you … Give them a call at: 952-445-8753 and let them know I told you to call.” https://www.facebook.com/MendenAccounting

Or some such… thanks again.

I will end by saying this: I have been reminded, once again, this year: YOU are what makes this nation great. No matter what the politicians may want to take credit for, it’s people like you — the quiet ones who might not ever show up on the roll calls of any Forbes list, but who are doing so many incredible things (that WE get to see!) — who are responsible for any greatness that we might claim as a nation.

What a privilege it is to serve you. To know you. We are all so grateful.

Warmly,

Roger Menden
952-445-8753

R. Menden Accounting & Tax Service

Considering Filing A Tax Extension In Shakopee, MN? Read This First.

tax extensionLast week, I wrote all about those deadlines. <shiver> I know for a fact that the very word can strike pain and anxiety into the hearts of certain of my clients (who shall remain nameless).

So, this week … well, I’m going to give you the chance to exhale a little. It’ll be like a warm bath of security, peace and comfort.

(And given all the chaos we’re seeing on the national and international stage, we could all use a little security, peace and comfort, yes?)

And it’s not *just* because the personal tax filing deadline falls on Tuesday April 18th, 2017. (Three extra days!)

Today, we’re going to talk about the magical world of the tax return extension —  and what it really means. If, at this point, you’re still staring blankly at a pile of receipts and documents and it just. seems. so. hard. … well, the extension is your friend.

If you’ve already had us complete your taxes, I really would love it if you would help us in a unique way: Would you leave us a review on Yelp or Google Maps for other potential clients to see? We have found that these sources can be so helpful for people evaluating their options, and we would love to have as much information there as possible. Thank you!

So, here’s the truth about extensions. It’ll still feel like that “warm bath” of comfort I mentioned, but with a few deadline-ish things to know as well.

Considering Filing A Tax Extension In Shakopee, MN? Read This First.
“It usually takes more than three weeks to prepare a good impromptu speech.” -Mark Twain

This upcoming Tuesday, April 18, 2017 is the filing deadline for a federal tax return. If you need more time to get your paperwork complete, you need to file (or have us file on your behalf) an extension with the IRS by the end of the day on the 18th. This gives you an automatic six-month extension of time to actually file (until October 16, 2017).

This is the form you can use: http://www.irs.gov/pub/irs-pdf/f4868.pdf

But it’s also as easy for us to do for you as pushing a couple buttons (it really does pay to use a pro).

This can be a very comforting and helpful process for the procrastinators among us.

An important note: An “Extension of Time to File” is not an “Extension of Time to Pay”, unfortunately. The Extension simply gives you an automatic six months of additional time to get your paperwork together and file that return. But, if you owe more than what you paid with your estimate, you’ll be accumulating penalties and interest on the difference — so PLEASE don’t take the entire six months to do this.

That said, depending on the amounts we’re talking about, those penalties and interest payments may not be that much. The late payment penalty is 0.5% of the tax owed after the due date, for each month or part of a month the tax remains unpaid (up to 25%, which, hopefully, you would never hit).

So, when filing your “Extension of Time to File”, you’ll need to estimate what you think you owe to the IRS.  This should not be pulling numbers out of thin air. You’ll still need to go through your receipts and tax documents and get them “somewhat” organized.

From here, you can estimate both your income and your expenses, and then approximate what you owe Uncle Sam. Keep in mind that this is an ESTIMATE. And, you’ll have to pay what you estimate you owe at the time we file for the tax extension.

As I mentioned earlier, You can do this all electronically through our office, you can mail in the form WITH estimated payment (must be postmarked by the 18th), or you can call a specialized provider and pay by credit card. We can provide you with the appropriate number to call.

If you cannot pay your taxes due:

First of all, you’re not alone. There are many, even right here in Shakopee, MN (and, of course, beyond), who are unable to pay everything right away. But this is what we’re here for. We can help you through this stuff too.

Here’s what we would tell you…

1) Pay as much as you possibly can right now.

2) You can ask for (and often receive) an extension of up to 120 days to PAY: https://www.irs.gov/taxtopics/tc202.html. It does require a phone call to the IRS. 🙁

3) “Financial hardship” delay: this is if paying your tax bill would demonstrably affect your ability to pay your other bills. Interest and penalties still accrue, but it’s better to register this with the IRS than to simply ignore the bill.

4) Installment payment plan: If you owe less than $50K in taxes, you should usually be able to get an installment payment plan of up to 72 months, simply by asking for it. If this is something you are considering, please let’s talk it over to make sure we come up with the best plan. But you can apply online for this here: https://www.irs.gov/Individuals/Online-Payment-Agreement-Application

5) Negotiate: this is NOT something to try on your own. We can help, but the number of “Offers in Compromise” that get accepted each year are quite small and a knowledge of how the system works is important.

6) Using existing credit sources (credit card, HELOC, private loans): some tax advisors would quickly recommend this, but I would NOT recommend you go this route. If you’ve exhausted the options above, do this instead:

7) Sell something you don’t need anymore and make up the difference.

But again, this is what we’re here for —  we’ll walk you through your best options and figure out the smartest course of action for you.

Warmly,

Roger Menden
952-445-8753

R. Menden Accounting & Tax Service

Roger Menden’s List of What Else Is Due On April 18th

April 18thIt’s “go time” around here. Our phones are buzzing, the email inboxes are overflowing, but we are focused like a laser beam on giving our clients the BEST service for their time (and wallet), and ensuring that nobody is paying Uncle Sam more than they should.

We’ve invested a lot into this time of year — in education, client management software (so that nothing falls through the cracks), and in staffing — all so that we serve you extremely well. Some tax professionals fly through these last few weeks in a caffeine-soaked haze, but in truth, we are more focused than we’ve ever been … and thrilled that we get to serve people like you.

We see the kinds of lives our clients lead, and we are privileged to play a small part in helping them do it all so well.

But yes — there are a few deadlines coming up, and I’d like to take this chance to remind you of them.

It’s not just taxes that come calling on April 18th this year (yes, you read that right — the tax deadline is a few days later than normal this year).

Now before I explain, if you’ve already had us complete your taxes, I do have a favor:

Would you leave us a review on Yelp or Google Maps for other potential clients to see? We have found that these sources can be so helpful for people evaluating their options, and we would love to have as much information there as possible. Thank you!

Now, onto those deadlines…

Roger Menden’s List of What Else Is Due On April 18th

“It takes as much energy to wish as it does to plan.” -Eleanor Roosevelt

Yes, personal federal income taxes are due on Tuesday, April 18th 2017.

But that’s not all.

I truly hope this is not overwhelming, and some of this might not apply to you. Regardless, it’s good to know, and some of this knowledge could save you a bunch.

State tax returns are also due. The exceptions are:

  • States with no income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming
  • Hawaii is due 4/20
  • Delaware is due 4/30
  • Iowa, Virginia are due 5/1
  • Louisiana is due 5/15

So, if your state is listed there, we are already on top of things accordingly for you.

Estimated tax payments for the first quarter of 2017 are due. For some clients, not only do you have to pay the federal and state bill, but you you need to get started on 2017 estimated taxes. We’ve included this information for clients, and can help you make the proper payments as needed.

Last day to make an IRA contribution to affect your 2016 taxes. This might be a simple way to reduce your tax burden at the last minute. Let’s make sure we have clarity together before you do something hasty on this front, though.

Last day to claim unclaimed funds from 2013 unfiled tax returns. There are (literally) almost one BILLION dollars in unclaimed refund money available from the IRS from 2013 returns. Here’s the catch: You must claim it by April 18th, 2017. (Source: http://www.bankrate.com/finance/taxes/irs-1-billion-unclaimed-refunds.aspx)

How do you do that? Have us take a look at your return, and file an amendment if we find something which needs changing, updating, etc. There are all kinds of reasons why this might be — suffice it to say, “nothing ventured, nothing gained”.

Or, alternatively, there are people who simply didn’t FILE a return, but just trusted that the taxes withheld from paychecks were correct. Oops — that’s where the IRS gets the billions figure, because there are so many unclaimed refunds due to unfiled returns.

Either way, we can help (and routinely do). Call us.

 

Warmly,

Roger Menden
952-445-8753
Menden Accounting & Tax Service

 

4 Very Common Mistakes Shakopee, MN Investors Should Avoid When Opening An IRA

Opening an IRAThere are so many different messages coming out of DC, per the media, that if you try to make sense of it all through the mass media lens, then you’re bound to work at cross purposes with yourself.

There’s the Republican health care bill, and the current version of the bill is dominating political headlines.

Or, of course, there’s the initial budget being proposed by President Trump which is sure to make certain sectors, of my client base pretty happy.

Then again, there are the war drums being banged (once again) from North Korea

Happy Spring, everyone!

But truly, if you subject yourself to media hysteria, you will make 1) poor financial decisions (because things ALWAYS change) and 2) you will remain in a state of continuous frustration and anger — because that’s what the media feeds on, no matter the political tilt.

I choose to “opt out” of the hysteria. While, of course, keeping my powder dry to respond to REAL issues in my life.

And YOU get the luxury of being able to trust that my staff and I are following all of the tax law changes as they come, and taking greatest possible advantage on your behalf.

Of course the tax law we’re currently using for return preparations has been “in the books” for quite some time now, so we’re not needing to make any rapid shifts these days. Just working the plan, and helping you save the most amount possible.

Speaking of savings… I see many IRAs set up this time of year, and of course, as we review our clients’ return information. But I also see some common mistakes, and I’d like to help you with those.

Let this be a “palate cleanser” from all the chaos, and let’s take a positive step towards saving WELL this week.

4 Very Common Mistakes Shakopee, MN Investors Should Avoid When Opening An IRA
“Part of making good decisions is recognizing the poor decisions you’ve made and why they were poor.” -Warren Buffett

Opening an IRA for your retirement is almost always a good investment, but it’s not always a simple process. There are IRA alternatives (like a SEP, 401k, etc.)  that many of our clients know how to use (but you might not), there is the Roth option, and of course there are also the pitfalls that people fall into when setting them up. For example:

Not getting professional advice. 
Don’t try to do this on your own. Despite the many softwares, websites, etc. trying to lure you with the promise of saving money on commissions or other professional fees, those who work with a professional do tend to see better overall returns over time, for a number of reasons.  Not to mention the timely, expert advice they can provide when you need it — which you surely will from time to time.

If you are reading this post, whether as a client (or you’re considering still working with us) or someone passed it on to you, know that we are in your corner from the get-go for these sort of questions.

Naming the wrong beneficiaries, or not naming any at all. 
Making your minor child a beneficiary will require a court-appointed guardian to manage the money until the child turns 18. If you fail to name a beneficiary, it is likely the IRA will become payable to your estate upon your death. This unnecessarily subjects the IRA to estate taxes.

Confining yourself to the form. 
Most account agreements allow little space in which to name more than one beneficiary. With a little jiggering though (whether with an additional paper tacked to the initial paperwork, or by working the software a little) you can make sure to add the information of all beneficiaries, and exactly how you want the account to be distributed.

Thinking your financial institution keeps records of everything. 
In this age of mergers and acquisitions, who knows where your records could be? Keep copies of your account agreement and beneficiary designations, and let your professional and your family know how to find them.

And as I mentioned, we’re here to help. Let me know if you have any questions.

Warmly,

Roger Menden
952-445-8753

R. Menden Accounting & Tax Service

Why You Should Consider Giving Away Your Tax Refund by Roger Menden

tax refundThis past Sunday, the NCAA revealed the brackets for March Madness. The country will be inflicted with a particular form of hysteria these next few weeks, but unfortunately, this little national hoops holiday isn’t one which my staff and I get much chance to participate in. We’re too busy doing your taxes!

Yep, this is close to our busiest time of the year, and we’re working “like mad” (see what I did there?) to handle the increased volume this year. Because with all of the political chaos out there, it’s clear that people want real answers from someone who knows them — and cares.

But let me say this: though my business does well this time of year, I’d rather things were better and our tax code was simpler. I’d rather the economy was roaring and everyone felt confident enough to handle their own financial forms.

However, the sheer complexity of the tax code keeps me in business — to take the hassle away from you, and apply our expertise to your situation. But wouldn’t it be more efficient if paying taxes didn’t actually require so much expertise?

I know … a bit of a controversial statement from a tax accountant. But I get tired of seeing new clients bring last year’s tax returns to us–and realize that if we’d helped them sooner, they would have saved a bunch of money (fortunately, we *can* file amended returns!). If things were simpler, people would keep more of their money — and THAT’S one of my passions.

Now, I have some thoughts here that might feel a bit controversial. But I’d love your thoughts on it, and I read every note that comes my way.

Why You Should Consider Giving Away Your Tax Refund by Roger Menden
“If you do what you’ve always done, you’ll get what you’ve always gotten.”  -Tony Robbins

We have many clients who are receiving tax refunds this month, and that number of course will only be rising. So, here’s a thought for you: What would it look like for you to give your refund away?

Yes, this is a radical idea to think about, but consider: what does this tax refund represent to you?

If you’re like many families, it’s a bit like “found money” — i.e. an unexpected windfall. And, in those scenarios, it’s tempting to hoard it, or to splurge.

However, as with other windfall scenarios which I’ve written about in the past, one of the smartest things you can do is to give a portion (at least) of it away.

Why do I suggest this?

Well, I believe it’s actually enlightened self-interest in the long run. And not just in your sense of “feeling good”.

I see the balance sheets of people from every walk of life, and over the years I’ve noticed an interesting phenomenon: individuals and families who make giving a priority, even when they aren’t “wealthy”, seem to do better in the long run. And I mean financially — not just in their state of mind.

(Though, there are significant soul reasons for giving. Have you seen, as I have, that those who freely give seem to be more pleasant company?)

Before you write this off as being “ask the universe” mushiness, understand that 1) I don’t subscribe to that baloney and 2) I am merely reporting an observed phenomenon. Do with it what you will.

You see, I make it a point to observe how money works. And, for some reason — money gets attracted to those who aren’t merely in hot, desperate pursuit of it. It’s almost like it is in romance — potential lovers are usually turned off by the overly-aggressive seeker.

So consider this. I know it might feel painful. But trust me when I tell you that it can actually provide you with a deeper feeling of joy than if you choose to cling tightly to everything that comes your way.

I hope I didn’t ruffle your feathers … but if so, understand that most of all, we are here to walk with you no matter WHAT your balance sheets look like, or what you choose to do with it.

And lastly, we’re here to help. Let me know if you have any questions.

Warmly,

Roger Menden
952-445-8753

R. Menden Accounting & Tax Service

Roger Menden’s Tax Paperwork Checklist

tax paperwork checklistThese days, I’m often glad that it’s our busy tax filing season, so that I have an easy excuse when political conversations are happening: Oh THAT [crazy new political story]? Huh, didn’t see it — I’m too busy with tax season.

With all of the chaos out there, the division and shouting — from Washington to Facebook to right here in Shakopee, MN, it’s helpful to try to tune out the shouting and focus on what is actually in our sphere of productivity.

So speaking of being productive, it might be time to get moving on your tax files, if you haven’t already.

The IRS did a study a few years ago that computed that the *average* time that it takes to complete a tax return is 22 hours. And obviously, that number varies by the return, but I’m reminded (again) of the blessing that it is to free our clients’ TIME — not to mention the additional deductions we find, the stress we remove, and the security we can provide in knowing that it’s being handled right.

Already, we have many, many Shakopee, MN tax clients who have filed, have received refunds and have written us notes telling us that they’ve never been more pleased with their filing experience. And of course, this makes me happy, as you might imagine.Now, I’ve got something here that we posted towards the beginning of January, but as we are moving into the depths of March, I thought it would be worth posting once more…

Roger Menden’s Tax Paperwork Checklist
“We are not retreating — we are advancing in another direction.” -Douglas MacArthur

With the increased penalties associated with the ACA in 2017, and all of the other changes every year, filing your taxes on your own is not for the faint of heart — even with nice-looking softwares on the market which purport to make it easy for you.

But that’s what we’re here for. Let us be your easy button.

Below is a list of what you will need during the tax preparation process. Not all of them will apply to you — probably MOST will not. Nonetheless, it’s a useful checklist.

Before you get overwhelmed: yes, this is a long list — but it’s the unfortunate reality of our tax code that it’s not even comprehensive! But these items will cover 95% of our Shakopee, MN tax clients.  Really, this is for ensuring that we’re able to help you keep every dollar you can keep under our tax code.

Even if for some strange reason you won’t be using our cost-effective services this year, feel free to use this list as a handy guide…

Personal Data
Social Security Numbers (including spouse and children)
Child care provider tax I.D. or Social Security Number

Employment & Income Data
W-2 forms for this year
Tax refunds and unemployment compensation: Form 1099-G
Miscellaneous income including rent: Form 1099-MISC
Partnership and trust income
Pensions and annuities
Alimony received
Jury duty pay
Gambling and lottery winnings
Prizes and awards
Scholarships and fellowships
State and local income tax refunds
Unemployment compensation

Health Insurance Information
* All 1095-A Forms from marketplace providers (if you purchased insurance through a Marketplace)
* Existing plan information (policy numbers, etc.)
* If claiming an exemption, your unique Exemption Certificate Number
* Records of credits and/or advance payments received from the Premium Tax Credit (if claiming)

Homeowner/Renter Data
Residential address(es) for this year
Mortgage interest: Form 1098
Sale of your home or other real estate: Form 1099-S
Second mortgage interest paid
Real estate taxes paid
Rent paid during tax year
Moving expenses

Financial Assets
Interest income statements: Form 1099-INT & 1099-OID
Dividend income statements: Form 1099-DIV
Proceeds from broker transactions: Form 1099-B
Retirement plan distribution: Form 1099-R
Capital gains or losses

Financial Liabilities
Auto loans and leases (account numbers and car value) if vehicle used for business
Student loan interest paid
Early withdrawal penalties on CDs and other fixed time deposits

Automobiles
Personal property tax information
Department of Motor Vehicles fees

Expenses
Gifts to charity (receipts for any single donations of $250 or more)
Unreimbursed expenses related to volunteer work
Unreimbursed expenses related to your job (travel expenses, entertainment, uniforms, union dues, subscriptions)
Investment expenses
Job-hunting expenses
Education expenses (tuition and fees)
Child care expenses
Medical Savings Accounts
Adoption expenses
Alimony paid
Tax return preparation expenses and fees

Self-Employment Data
Estimated tax vouchers for the current year
Self-employment tax
Self-employment SEP plans
Self-employed health insurance
K-1s on all partnerships
Receipts or documentation for business-related expenses
Farm income

Deduction Documents
State and local income taxes
IRA, Keogh and other retirement plan contributions
Medical expenses
Casualty or theft losses
Other miscellaneous deductions

We’re here to help. Let me know if you have any questions.

Warmly,

Roger Menden
952-445-8753

R. Menden Accounting & Tax Service

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