Russ Victor’s Guiding Principles For Teaching Kids About Money

04 August 2020 Categories: Blog

However you slice it, the schooling situation right now is tough, with no good options.

If you are vehemently in favor of full-on school … well, compassion would dictate that you would recognize that others are having more difficulty with that, for caution’s sake or for whatever other reason. Compassion doesn’t mean bullying, as I recall.

And if you are vehemently in favor of keeping children out of school … well, compassion similarly dictates that this is not a simple matter for many Massachusetts families, and that people would have serious difficulty changing their entire lifestyle around this new reality.

More compassion, less arguing and bullying. Sadly, our cultural leadership doesn’t seem to hold these values very strongly, and here we are.

It is HARD.

As is, really, every parental effort to pass along values to the next generation. Anyone who says it’s easy just hasn’t yet faced what’s coming down the pike for them.

That’s why, when passing along financial values to our children, I like to operate by guiding principles, as specifically as possible … but also understanding: this isn’t an easy task.

So, while your children might perhaps be more underfoot this fall than any of us anticipated earlier this year, it might be the right time to address their financial education.

In which case, I offer you these principles to get you started…

Russ Victor’s Guiding Principles For Teaching Kids About Money
“One thorn of experience is worth a whole wilderness of warning.” – James Russell Lowell

Rather than seeing these ideas as “rules”,  it might be helpful to think of them as principles when it comes to teaching kids about money.

And yes … some of these may be difficult (the first ones, in particular, if they represent a shift for you), but after seeing many Massachusetts families do this well, these are some of the best things you can do with your children when it comes to financial education.

1. Talk openly about money.
Parents make a mistake when they keep information from their children. The only way children learn what is a good deal and what is too expensive is by the experience of what their family earns and what items cost. Hiding this information robs children of the financial education they need.

2. Talk factually about money.
Many parents have strong emotions about money based on their childhood experiences. These emotions are always transmitted to children. Instead of helping children, they can cripple children from growing up to make sound financial decisions

3. Require chores; pay for optional work.
Everyone in the family has to help complete the work that needs to be done. If you want to pay your children, only pay them for optional work they can choose to do or not to do.

4. Provide children an allowance they can make real choices with.
Talking about money is important, but children need real-world lab experience to understand the consequences of their decisions. Consider giving them an allowance large enough so that they can purchase some of their own needs. Then continue to give them honest advice, and help them ask the right questions to make wise decisions based on their values.

5. Help children comparison-shop.
Help them consider issues such as cost, quality, and convenience. Every choice in life involves trade-offs, right?

6. Require children to wait before making large purchases.
Adults should wait at least a month whenever they are making a large purchase. Children shouldn’t be expected to wait that long. Here is a good rule of thumb: Children should be required to wait as many days as they are old in years before being allowed to make a large purchase (over a week’s allowance). There is always tomorrow, and over half the time they won’t remember what attracted them to the desired item in the first place. Developing this habit will help make them resistant to impulse buying.

7. Don’t use money as a punishment.
Your priority should be helping to give your values to your children, not buying their outward behavior.

8. Don’t loan your children money!
If their desired purchase is something they should be saving for, let them save for it. If you want to buy it for them for the value of the experience, buy it for them. The principles are, “If they want it, they have to save for it. If you want them to have it, you will buy it for them.” Loaning your children money for items they want teaches them they aren’t responsible and don’t have to prioritize.

Some may disagree with all of these admonitions — I don’t intend to become a “parenting guru” in my spare time — but I do hope that, at minimum, this will help you be thinking about how your wishes get passed down.

Also, make sure they know that you don’t have to overpay in taxes. There are legal and ethical ways to keep as much of your money as possible out of Uncle Sam’s pockets. And your friends too. You might use this to remind them:

+++++++++++++++++
“No Charge” Return Review
Special Gift Certificate
As a complimentary service this year, we will provide a
Return Review to any non-client.
We will also review prior year returns from clients who did NOT have us handle their taxes during the year under question. No charge will be made, unless we have to file an amended return.
781-767-7473
to set up this complimentary service
Deadline: Friday, August 7th, 2020
+++++++++++++++++

We’re in your corner.

Warmly,

Russ Victor
(781) 767-7473

 

“CRISIS Action Plan” for my Massachusetts tax clients and friends:

1) Don’t marinate in other people’s panic. Be mindful of your social media consumption.

2) Continue to stay financially and logistically prepared for worsening situations.

3) Make sure you have some ready, liquid assets, if you are able. (I.e., cash in the bank, and in hand.)

4) Set aside plans for any big spending until the dust settles — but especially look out for your small business owner friends and vendors.

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A Strategy For Massachusetts Taxpayers With A Higher Than Expected Tax Bill

28 July 2020 Categories: Blog

Taking a look around the world these days, and where things seem to be headed…

But our heads are high here at Rusself Victor, CPA, PC because we worked our tails off for our Massachusetts clients this year. We helped a bunch of people save a ton on their taxes — with deductions and strategies they wouldn’t have used had they not listened to our advice.

AND we got the privilege to make so many Massachusetts people’s lives just a little bit easier during this very intense time.

I’m not looking for a “thank you” with this note — just letting you into our headspace here right now. We have a sense of (tired) accomplishment.

We worked so hard because we were (and are) animated by the stories we heard repeatedly from those who didn’t use our services, or who came to us at the end of their rope: people going through massively difficult times, and then slapped with a big tax bill on top of it all.

For some, this is an unavoidable reality: those who did no tax planning, or who worked with other tax pros, or who just had some tough circumstances.

But for others — it was avoidable. And it might still be. (More about that shortly.)

We love what we do, and even though this “busy season” was three months longer than usual, we’re not letting up.

Because while some of our competition is out there taking their weeks and months off, recovering and living off of the “fat” of tax season, we’re attending (virtual) conferences, developing our proficiencies in managing our business (and yours), and writing you these strategy notes.

All because we want to be people who bring you GOOD news, not bad.

Before I get to today’s note, would you do us a favor? If you have already used us for your taxes, would you let us know what you thought? We really appreciate it. A great review would be very, very helpful.
Make us smile with a review on Google
Leave us a review on Yelp

If for some reason you had problems, please shoot me an email through the email us link at the top of the page so I can address it and make it right somehow.

Now … let’s talk about avoidable bad news.

A Strategy For Massachusetts Taxpayers With A Higher Than Expected Tax Bill
“I never thought in terms of being a leader. I thought very simply in terms of helping people.” -John Hume

Our Massachusetts 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 the 2019 tax year. 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 2019 returns (and 2018 and 2017). Not so.

Because according to a report on the matter issued by the Government Accountability Office, taxpayers overpay the IRS over $1 billion every year due to incorrect itemization and preparation.

And the IRS isn’t in any hurry to just give that back to you, this year of all years.

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 mistakes…

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” return.

Many Massachusetts tax professionals don’t provide filing an amended return service, but even though we’ve completed our clients’ returns, we WILL review any of your friends’ returns — at no charge.

Use this… (and feel free to forward this to your friends)

+++++++++++++++++
“No Charge” Return Review
Special Gift Certificate
As a complimentary service this year, we will provide a
Return Review To Any Non-Client.
We will also review prior year returns from clients who did NOT have us handle their taxes during the year under question. No charge will be made, unless we have to file an amended return.
781-767-7473
to set up this complimentary service
Deadline: Friday, August 7th, 2020
+++++++++++++++++

We’re in your corner.

Warmly,

Russ Victor
(781) 767-7473

 

“CRISIS Action Plan” for my Massachusetts tax clients and friends:

1) Don’t marinate in other people’s panic. Be mindful of your social media consumption.

2) Continue to stay financially and logistically prepared for worsening situations.

3) Make sure you have some ready, liquid assets, if you are able. (i.e., cash in the bank, and in hand.)

4) Set aside plans for any big spending until the dust settles — but especially look out for your small business owner friends and vendors.

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Reflections On The Extended Tax Season By A Local Massachusetts Tax Professional

21 July 2020 Categories: Blog

I remember at the end of April 2019 that I felt like it had been one of the wildest tax seasons in memory. The TCJA (“Trump Tax Code”) had thrown a ton of curveballs our way, and we were looking forward to implementing tax planning strategies for our Massachusetts clients with an entire year under our belts.

And we did, and have done so.

But then 2020 came like a tsunami.

And we have faced it together, haven’t we?

Through it all, we’ve held together — and I hope we’ve been a small part of you and your family holding it together too.

Today is an extremely busy day for us here at Rusself Victor, CPA, PC — we’re still working on behalf of our Massachusetts clients.

But I’m taking the time to write to you, because I had to say this.

I want to make sure you heard this from me (though you are likely to be actually receiving it later in the week, especially depending on how this day goes)…

THANK YOU for your trust.

It is no small matter to place your financial life in front of another, and that’s especially true during a season of so much disruption and pain. That’s why we work so hard to be people that you can trust for more than a mere “filling out some forms” service.

It’s why I make it a point to write these notes every week, sometimes more (even when we are slammed with work) — and it’s why we work so hard to stay up-to-date on all of the latest tax code updates and regulatory changes that come like clockwork, every year.

But dare I say this? I believe that the future is bright. We WILL get through this COVID and cultural disruption, and we will do it together.

We take your trust seriously. THANK YOU for it, and for your business.

I also want to add this: throughout this donkey of a year, we ALSO got to see remarkable lives of generosity, love and integrity laid out before us with regularity. For some, this was reflected by their financial statements — and for others, this was displayed by the warmth, kindness and delight by which you communicated with us during this process.

This much is clear: No matter the state of your financial life, nobody (not the IRS, not the governor, not the CDC, not anyone) can take from you the strength derived from a life lived with gratitude and joy.

You’ve reminded us of that once again, this year. What a privilege it has been to serve you this extended tax “season” … and we look forward to years of service to come.

Lastly, and as I mentioned above … we’re not letting up. We’re committing the “offseason” to continuing our education in all of what has come at us this year, and to serving you and your family in ways well beyond simple tax preparation. Ask us about how we can help you be better prepared for next year, and you may really like what we can do for your family’s bottom line.

With a grateful heart,

Russ Victor
(781) 767-7473

PS — If you have filed your taxes with us would you …

A) Write something of your experience for people to know about in the future? You can find us on Yelp and Google, as they seem to be the place where many people are looking these days.

Make us smile with a review on Google
Leave us a review on Yelp

(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 Russ Victor’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: (781) 767-7473 and let them know I told you to call.” https://www.facebook.com/pages/Rusself-Victor-CPA-PC/215815921268

Or some such … thanks again.

Warmly,

Russ Victor

(781) 767-7473

 

“CRISIS Action Plan” for my Massachusetts tax clients and friends:

1) Don’t marinate in other people’s panic. Be mindful of your social media consumption.

2) Continue to stay financially and logistically prepared for worsening situations.

3) Make sure you have some ready, liquid assets, if you are able. (I.e., cash in the bank, and in hand.)

4) Set aside plans for any big spending until the dust settles — but especially look out for your small business owner friends and vendors.

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The End of Tax Season, Estimated Taxes, And Unemployment Compensation by Russ Victor

14 July 2020 Categories: Blog

I’m still emotionally adjusting to the fact that we just went through 4th of July weekend … and “tax season” is STILL GOING.

I’m thankful for it, because I also know that extending the deadline during this wild, intensely difficult year (for so many) was a rare offering of grace from the IRS for Massachusetts taxpayers.

Even if it has disrupted MY yearly rhythm, everyone here at Rusself Victor, CPA, PC is animated by the fact that we get to be the people who come alongside Massachusetts families during a season of great intensity and offer our skills to bring at least one small measure of relief.

We are in your corner.

So here’s my reminder: if you owe taxes, they are DUE on July 15th. As are the first two estimated tax payments.

A quick note on the payments: You must make separate payments for 2019 and 2020 (estimated) taxes. In other words, you shouldn’t just write one big check.

First take care of your 2019 obligations in one check, and then for your estimated payments be sure to fill out a Form 1040 ES payment voucher with a second check or money order for that. Indicate on your check memo line that this is a 2020 estimated tax payment. You do NOT need to make separate payments for both the first and second quarter.

If paying electronically through Direct Pay, make sure you indicate what the payment is for. But that process is usually smooth. The only problem is that you can only pay up $9,999,999.99 — and since that applies to exactly zero of my Massachusetts clients, it’s not really a problem.

If it does apply to you … you need better tax planning.

We can help with that. 😉

“Am I subject to paying estimated taxes?”

Good question. Usually, you know if you are (and we’ve communicated this to you). If you’re confused, here’s the rule of thumb: you pay estimated tax for 2020 if you expect to owe at least $1,000 in tax for 2020 AND you expect your withholding and refundable credits to be less than the smaller of 90% of the tax to be shown on your 2020 tax return or 100% of the tax shown on your 2019 tax return.

We can help you determine what the amount should be, but a quick and dirty calculation would be one fourth of the estimate of what your taxes due at the end of the year would be.

(And this year, the first payment is double that amount, or one half, due on July 15th.)

Unemployment Compensation

Yes, the rumors are true: For federal income tax purposes, unemployment compensation is taxable. This includes your state benefits and the $600 payment from the feds, if you received that. To help manage the tax due, you can choose to have federal income tax withholding on your benefits or consider making estimated payments during the year.

If you need help, let us know: (781) 767-7473

Lastly, would you do me a favor?

If you have already used us for your taxes, would you let us know what you thought? We really appreciate it. A great review on Google would be very, very helpful.

If for some reason you had problems, please shoot me an email so I can address it and make it right somehow.

Leave us a review on Yelp

https://www.google.com/maps/place/Rusself+Victor,+CPA,+PC/@42.164749,-71.0593701,17z/data=!3m1!4b1!4m5!3m4!1s0x89e48253a8d28921:0x2fc2dbcc841ebe62!8m2!3d42.164749!4d-71.0571814?hl=en

That’s all I’m going to focus on today.

Warmly,

Russ Victor

(781) 767-7473

 

“CRISIS Action Plan” for my Massachusetts tax clients and friends

1) Don’t marinate in other people’s panic. Be mindful of your social media consumption.

2) Continue to stay financially and logistically prepared for worsening situations.

3) Make sure you have some ready, liquid assets, if you are able. (I.e., cash in the bank, and in hand.)

4) Set aside plans for any big spending until the dust settles — but especially look out for your small business owner friends and vendors.

Read the full article 0 Comments

Russ Victor’s To-Do List If You Can’t Pay All Your Taxes

07 July 2020 Categories: Blog

Some of our Massachusetts clients are STILL pulling their paperwork — which is understandable during this donkey of a year, and with all of the new complications.

But sadly, ye olde IRS isn’t extending any payment grace in a couple weeks. (I say “sadly”, but here at Team Victor we may or may not be champing at the bit to turn the page on this crazy tax season.)

So yes — taxes are due in a couple weeks!

And not just tax returns, but payments of 2019 tax due AND estimated taxes from the first quarter AND estimated taxes from the second quarter.

All of it is due together.

And the 15th of July brings other deadlines too … like contributing to an IRA to have it reflect upon your 2019 taxes.

It is also the final day to max out contributions for your 2019 HSA (Health Savings Account) and to claim any refund money from an unfiled 2016 return. (There is over a BILLION in unclaimed refund money out there for that year — but only available if you didn’t file) and most states’ tax deadlines also fall on the 15th (here’s the complete list).

If all of these deadlines are overwhelming, let’s help you formulate a plan. It doesn’t have to be a hot mess.

It never does — this is what we are here for: (781) 767-7473.

(If you HAVE already used us for your taxes would you let us know what you thought? We really appreciate it. You can also find us on Yelp and/or Google Maps. A great review on Google would be very, very helpful — but if for some reason you had problems, feel free to shoot me an email so I can address it and make it right somehow.)

Leave us a review on Yelp

https://www.google.com/maps/place/Rusself+Victor,+CPA,+PC/@42.164749,-71.0593701,17z/data=!3m1!4b1!4m5!3m4!1s0x89e48253a8d28921:0x2fc2dbcc841ebe62!8m2!3d42.164749!4d-71.0571814?hl=en

Your situation might be unique (in which case, let’s talk!), but I also have in my possession a rundown of what to do in these next couple weeks if you anticipate not being able to pay all of the taxes that are due (remember, 2020 estimates AND 2019 taxes are due).

Here you go:

Russ Victor’s To-Do List If You Can’t Pay All Your Taxes

“Deep summer is when laziness finds respectability.” – Sam Keen

As you know, Wednesday, July 15th is the filing deadline for a federal tax return for Massachusetts taxpayers, and all of those other things I mentioned above. If you need more time to get your paperwork complete, you need to file (or have us file on your behalf) this form: http://www.irs.gov/pub/irs-pdf/f4868.pdf with the IRS by the end of the day on the 15th. This gives you an automatic three-month (until October 15, 2020) extension of time to file. 

But I hope you understand that an “extension of time to file” is not an “extension of time to pay”, unfortunately. The extension simply gives you an automatic three 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 three months to do this!

So, when filing your extension, 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. Then you’ll have to pay what you estimate you owe at the time we file for the extension.

You can do this all electronically through our office, you can mail in the form WITH estimated payment (must be postmarked by the 15th), or you can call a specialized provider and pay by credit card. We can provide you with the appropriate number to call.

Here’s what to do if you can’t pay all of your taxes due:

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 requires 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) Use 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. Always a pretty good plan anyway.

That was a lot of information. I truly hope it is helpful.

But regardless, we’re in your corner.

Warmly,

Russ Victor

(781) 767-7473

 

“CRISIS Action Plan” for my Massachusetts tax clients and friends:

1) Don’t marinate in other people’s panic. Be mindful of your social media consumption.

2) Continue to stay financially and logistically prepared for worsening situations.

3) Make sure you have some ready, liquid assets, if you are able. (I.e., cash in the bank, and in hand.)

4) Set aside plans for any big spending until the dust settles — but especially look out for your small business owner friends and vendors.

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Why Procrastination Makes Sense in 2020 For Massachusetts Taxpayers

30 June 2020 Categories: Blog

We’ve had impeachment votes, worldwide pandemics, quarantine-like lockdowns (for the healthy), public police brutality, widespread protests, intense riots, MURDER HORNETS, statues falling, social media anger and now we have a drunken and murderous monkey to top off our 2020.

What’s worse —  the year isn’t even halfway over yet. And there are plenty of other things that we could have thrown in there, just for giggles.

Oh yes — and some people still need to pull together their taxes.

And they’re due in about THREE WEEKS. (July 15th, 2020)

Is that you?

And if it is, does it startle you?

There have been so. many. distractions. these past few months for Massachusetts taxpayers that it’s easy to see how it could have been set aside. And perhaps not even unwisely (a few words on that in a moment).

But now, well … it’s go time.

(If you HAVE used us, could I ask a favor? Please let us know what you thought. We really appreciate it. You can also find us on Yelp and/or Google Maps. A great review would be fantastic, but if you have problems, feel free to shoot me an email so I can address them and make it right somehow.)

https://www.yelp.com/writeareview/biz/t2QWD60Ox6oHLUPrcPnJrw?return_url=%2Fbiz%2Ft2QWD60Ox6oHLUPrcPnJrw

https://www.google.com/maps/place/Rusself+Victor,+CPA,+PC/@42.164749,-71.0593701,17z/data=!3m1!4b1!4m5!3m4!1s0x89e48253a8d28921:0x2fc2dbcc841ebe62!8m2!3d42.164749!4d-71.0571814?hl=en

Now, if you are panicked, we can easily file an extension on your behalf, and make sure that your return is still handled as advantageously as possible. (Which doesn’t mean an extension to *pay*, but that’s a subject for another day.)

But I also know how procrastinating difficult work (like getting your taxes ready) can induce a lot of guilt.

And with all of the junk flying around our culture these days, the LAST thing you and I need is more guilt. So I’m here to fix that for you (and I even have a gift for you at the end of my Note).

Let’s break those chains of guilt together, shall we?

Why Procrastination Makes Sense in 2020 For Massachusetts Taxpayers

“Never tell people how to do things. Tell them what to do and they will surprise you with their ingenuity.” -George S. Patton

Still haven’t filed your taxes yet? You wouldn’t be alone during this donkey of a year.

Or maybe you have already done so, but there is another difficult or cumbersome task you’re avoiding.

Well, it could be that you are, in fact, smarter than the average bear.

You see, right now there are an infinite number of things you could be doing. No matter what you work on, you’re not working on everything else. So the question is not how to avoid procrastination, but how to procrastinate well.

In my view, there are three kinds of procrastination. Depending on what you do instead of working on something, you could work on:
(a) nothing,
(b) something less important, or 
(c) something more important.

That last type, I’d say, is good procrastination.

This is the kind of procrastination practiced by the “absent-minded professor” type, who forgets to shave, or eat, or even perhaps look where he’s going while he’s thinking about some interesting question. His mind is absent from the everyday world because it’s hard at work in another.

That’s the sense in which the most impressive Massachusetts people I know are all procrastinators. They’re type-C procrastinators: they put off working on small stuff to work on big stuff.

What’s “small stuff?” Roughly, work that has no chance of being mentioned in your obituary. It’s hard to say at the time what will turn out to be your best work (will it be your thesis for your PhD, or that detective thriller you worked on at night?), but there’s a whole class of tasks you can safely rule out: grinding through emails, doing your laundry, washing the car, getting a haircut–anything that might be called an errand.

Good procrastination is avoiding errands to do real work.

Good in a sense, at least. The people who want you to do the errands won’t think it’s good. But you probably have to annoy them if you want to get any real work done. The mildest-seeming people, if they want to do real work, all have a certain degree of ruthlessness when it comes to avoiding errands.

Some errands, like replying to emails, go away if you ignore them (perhaps taking friends with them). Others, like mowing the lawn, or filing your tax returns, only get worse if you put them off. In principle, it shouldn’t work to put off the second kind of errand. You’re going to have to do whatever it is eventually. Why not (as past-due notices are always saying) do it now?

The reason it pays to put off even those errands is that real work needs two things errands don’t: big chunks of time, and the right mood. If you get inspired by some project, it can be a net win to blow off everything you were supposed to do for the next few days to work on it. Yes, those errands may cost you more time when you finally get around to them. But if you get a lot done during those few days, you will be more net productive.

So here’s where we come in.

Consider us “The Ultimate Procrastination Solution”.

Allow us to take the pain away from these second-level tasks (like getting your return filed) — and you go back to writing that killer novel.

Warmly,

Russ Victor

(781) 767-7473

 

“CRISIS Action Plan” for my Massachusetts tax clients and friends:

1) Don’t marinate in other people’s panic. Be mindful of your social media consumption.

2) Continue to stay financially and logistically prepared for worsening situations.

3) Make sure you have some ready, liquid assets, if you are able. (I.e., cash in the bank, and in hand.)

4) Set aside plans for any big spending until the dust settles — but especially look out for your small business owner friends and vendors.

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Is Your State Broke? Russ Victor Analyzes State Tax Revenue Sources

23 June 2020 Categories: Blog

With national events continuing as they are, here at Rusself Victor, CPA, PC, we’re finding ourselves locking into “go mode” … again.

It’s unusual for us to be in this mode smack in the middle of June, but this year has not been … usual.

This is because the tax deadline (July 15th, 2020) is barrelling at us.

Many of our Massachusetts tax clients have already taken care of what they needed to, and we have filed a ton of returns (and are already in “tax planning mode” with those clients).

How about you, ~Contact.FirstName~? Do you want to get on our calendar to talk 2020 taxes? Shoot me an email through the email button at the top of the page or call us [(781) 767-7473] and we’ll take a look at some proactive strategies.

But if you have NOT filed your 2019 taxes … times’ a-wastin’.

And also, allow me to remind you, again, that two estimated federal tax payments are due on July 15th. Many states have followed suit on this, but some have not. Here’s a handy list for the due dates in your state — since, although most of our clients are based here in Massachusetts, we of course serve clients across the country.

I brought up the states there … and with all of the financial chaos roiling around us, it’s a good time to consider: is your state in financial trouble?

Chances are good that it is … in which case: what will your state do about it, and how might it affect you?

Some thoughts…

Is Your State Broke? Russ Victor Analyzes State Tax Revenue Sources

“A man should always consider how much he has more than he wants.” -Joseph Addison

The financial picture for the various states in our nation is a mish-mash of various revenue sources (and expenses).

Unlike, say, the federal government, the states cannot print money. So they are forced to go hunting for it. And they get it from a few primary sources: sales tax (based on purchases/consumption), income tax (individual and business taxes based on income), property tax and “other” taxes like the tax on fishing licenses, driver’s licenses and a lot of other smaller items. 

And the most volatile — and COVID-affected — of these sources is ye olde income tax. Sales tax has obviously taken a hit as well (but people still need to buy stuff) and property taxes, well … more about that next week.

So which states will be hunting for more revenue? This will give you a good picture — it’s a breakdown for which states are the most reliant upon income tax revenue. Oregon and Maryland stand out (especially Oregon, which has no sales tax) — but MANY states will be on the hunt for that sweet, sweet green.

You are your state’s “economic stimulus plan”. Make no mistake … the next couple years will find MOST states finding ways to grab revenue from you.

This will take the form of increased property taxes (which you can fight), increased scrutiny of business operations that cross state lines (for Massachusetts business owners, “NEXUS” is a word you need to know), as well as chopping their expenses.

There are already school districts that are looking at laying off anywhere from 1 in 5 to 1 in 12 teachers. Half of all cities will need to make last resort cuts to their police and fire departments (regardless of the politics and wisdom of it, “defund the police” might sound pretty nice to state treasurers). And garbage services will probably take a hit.

So what can you do about this? Well, that’s where we come in. Yes, we can help you plan out your federal tax picture and help you save there … but state taxes are still very much a category in which it quite literally pays to have a pro in your corner.

Don’t accept “software defaults” for your state taxes. Let the pros ensure that you don’t become your state’s piggy bank. Legally, ethically … and with your full financial picture in mind.

We’re in your corner.

 

Warmly,

Russ Victor
(781) 767-7473

“CRISIS Action Plan” for my Massachusetts tax clients and friends:

1) Don’t marinate in other people’s panic. Be mindful of your social media consumption.
2) Continue to stay financially and logistically prepared for worsening situations.
3) Make sure you have some ready, liquid assets, if you are able. (I.e., cash in the bank, and in hand.)
4) Set aside plans for any big spending until the dust settles — but especially look out for your small business owner friends and vendors.

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Financial Mindset Management for Our Massachusetts Tax Clients

16 June 2020 Categories: Blog

Based on the history of events over the course of the last few decades (both here in Massachusetts and beyond), you might have thought that world events would have slowed down in the last week — that there could begin to be some sense of normality.

But no. This isn’t a normal time in our nation. It’s not a normal time in Massachusetts.

This might strike you as a very good thing — after all, there are important conversations being had in corners where they perhaps haven’t ever occurred. It’s hard to disagree with that. Here at Rusself Victor, CPA, PC, we have been having very fruitful conversations as well with our Massachusetts tax preparation and tax planning clients.

But this is, after all, an election year … and if you are paying attention to the media and your newsfeeds, you might feel a rising sense of anxiety and chaos.

In fact, a recent NBC/WSJ poll indicates that a whopping EIGHTY percent of the nation feels like the country is spiraling out of control.

This — despite a rise in good news surrounding COVID infections, a surge in the recent jobs report (to which the stock market continues to respond favorably), a calming of some of the violence in our cities, and a variety of other positive signals.

Well, I have a theory about this which might not surprise you.

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Before I get there, a tax-related reminder for our Rusself Victor, CPA, PC clients: estimated tax payments are not due until July 15th. BUT, there are two payments due at that time (for both the first and second quarter taxes).

If this affects you, and you are wondering what your 2020 tax situation might look like (it could be radically different, after all!), let’s talk: (781) 767-7473 or shoot me an email.

Also: don’t forget that tax returns are due July 15th. This might feel like a very distant deadline … but it is just over one month away (!).

That means that if you have been delaying the gathering of your tax paperwork, then you might need to get on your horse. Let us know how we can help.

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But now let’s talk about your state of mind, and how you might be allowing yourself to be affected…

Financial Mindset Management for Our Massachusetts Tax Clients

“When the storm has passed, put your energy into rebuilding your life, don’t waste time looking back.” -Leon Brown

A recent article in the Wall Street Journal put it well: our primal instincts drive us towards obsession with stressful news and the social media sites that put it in front of us.

Twitter has had a whopping 24% increase in usage in the first quarter, compared to last year.

Facebook and Instagram feeds previously filled with cute/funny videos and pictures are raging with debate, conspiracies, arguments, shaming, and rancor. And we fill our minds with it. Police brutality videos alternate with rioter violence … and we can’t look away.

And we wonder why so many of us feel like our society is spiralling out of control. Even (especially?) here in Massachusetts.

It’s no wonder that this is the case. Our brains are wired to be on the lookout for threats, and have been since the days of hunting and gathering. We are quite literally predisposed to pay more attention to negative than to positive things.

And app/software/website designers know ALL about this, and have architected their systems to keep all of us hooked on the “rush” of negativity. Just one simple example is the “infinite scrolling” features of social media feeds — they go on, and on, and on … and we just can’t quit them because we unconsciously feel like we might be missing out on something we need to know about.

So what should we do about this?

My recommendation: build yourself SOME system of controlled media and technology intake. Emphasis on the word “system”.

Recognize that your proclivities towards absorption will conquer even the best intentions, and set an actual structure for yourself.

Whether that means putting your phone “to sleep” in a different place than your bedroom, batch processing the news or social media feeds within prescribed time limits, or even logging off of all social media for various periods of time — the point is, TAKE CONTROL.

Don’t allow the cycle of negativity to control your mind.

Oh and one more thing: get peace of mind by getting someone experienced and excellent to take the difficult things off your plate.

Oh, like your taxes — just to use an example.

For this, and for all of your financial needs … we’re in your corner.

Warmly,

Russ Victor

(781) 767-7473

 

“CRISIS Action Plan” for my Massachusetts tax clients:

1) Don’t marinate in other people’s panic. Be mindful of your social media consumption.

2) Continue to stay financially and logistically prepared for worsening situations.

3) Make sure you have some ready, liquid assets, if you are able. (I.e., cash in the bank, and in hand.)

4) Set aside plans for any big spending until the dust settles — but especially look out for your small business owner friends and vendors.

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Which Stimulus Payments Are Taxable (and Which Aren’t) For Massachusetts Taxpayers

09 June 2020 Categories: Blog

All over our nation, we’re seeing pain.

It’s overwhelming, as someone who has to communicate to a broad base of Massachusetts clients, to even articulate meaningful words about everything that is happening.

So … I’m just doing what I can to sit in the pain of it all with my friends, and not try to brush past it.

I don’t know much else to do, or to say, right now. I’m listening, I’m watching.

I’m pained by injustice. And I’m pained by the riots. But I’m most of all pained by the environment we’re in that makes people feel like the only way to be heard is to riot.

It’s all just … pain.

So, what can we do from here?

I’ll have to leave it to others to shine a broader path. But in the meantime, my vocation calls me to listen, to walk alongside all of my Massachusetts clients, white and black, and all the others, and do my part to make their load lighter.

Which is what all of our team here at Rusself Victor, CPA, PC is committed to.

Because, well … tax returns are still due, many Massachusetts families are struggling financially, and we’re still figuring out what this COVID-touched summer is going to look like.

So, speaking of taxes, I’m still getting questions about all of the government assistance that has rolled out over the past few months, and how it might affect your taxes.

Here are some answers.

Which Stimulus Payments Are Taxable (and Which Aren’t) For Massachusetts Taxpayers

“Oh, my friend, it’s not what they take away from you that counts. It’s what you do with what you have left.” – Hubert Humphrey

As difficult as it might be right now, let’s project forward to next year.

Let’s cross our fingers and believe that we all get through this donkey of a year that is 2020.

Maybe you have a business that clung to life, and you’re headed towards recovery in 2021. You took the PPP, or perhaps the EIDL (or both). Or perhaps you had to take unemployment for a period of time, but are slowly (but surely) getting back on your feet. The economic stimulus checks helped.

But then … taxes are due.

Uh oh.

Well, don’t fear my friend: Russ Victor is here to set your mind at ease.

Let’s start with the economic stimulus payments. Those are easy — they’re completely tax-free.

But things get trickier with unemployment benefits. Those are, in fact, taxable income. Depending on your state, you can elect to have tax withheld from those payments … and if you’re currently receiving these benefits, you will need to plan to pay taxes on it (depending on your total income, and other deductions, of course).

For the students, what about student loan forgiveness? Well, it depends on how you are receiving that forgiveness assistance. Employer-paid student loan repayment assistance is tax-free through 12/31/20 (per the CARES Act). Any other student loan forgiveness programs are taxable.

I recently covered mortgage forbearance. This and other debt forbearance programs which offer suspension and forbearance on credit card, car and other consumer debt do not affect your tax situation, because the debt has not actually been forgiven (the payments are delayed). That said, if debt is forgiven, it is taxable.

Now let’s talk business.

The PPP loan is not taxable. It is a loan, after all. But what about forgiveness? Ha, that’s more interesting, because there’s still congressional and government debate on this, such that it could change. That’s because the IRS took away deductions for any expenses that are factored into forgiveness. In effect, it makes the forgiven portion of the loan to be taxable. This may yet get corrected, but that is the state of things now.

Just like the PPP, the EIDL is not taxable. There was an initial portion of this which was to be considered a grant … and the IRS has not ruled on whether it is taxable. It is said to be “rolled into the PPP” however, so unless something is clarified on that front as well (which I predict will happen), the grant portion will be taxable.

I hope all of this helps. We’re here to help you through this very difficult season. Let us know if there’s anything we can do to help.

Warmly,

 

Russ Victor

(781) 767-7473

Rusself Victor, CPA, PC

 

“CRISIS Action Plan” for my clients and friends:

1) Don’t marinate in other people’s panic. Be mindful of your social media consumption.

2) Continue to stay financially and logistically prepared for worsening situations.

3) Make sure you have some ready, liquid assets, if you are able. (I.e., cash in the bank, and in hand.)

4) Set aside plans for any big spending until the dust settles — but especially look out for your small business owner friends and vendors.

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The Important Details of Mortgage Forbearance For Massachusetts Taxpayers

03 June 2020 Categories: Blog

Here we are, just out of perhaps the oddest Memorial Day weekend in memory.

The summer is here! But it feels like much of our country is still mired in winter. And that feels like it is still the case, no matter the hints of progress against this virus, and no matter the steps taken towards reopening you might be experiencing in your locality.

All of it just feels … odd.

But Memorial Day was a good reminder.

Our current struggles can be overcome.

And I believe they will.

Even just one or two generations ago, our nation faced much worse — and prevailed. The sacrifices we have all been forced to make in the midst of this pandemic are nothing compared to the rationing and privation of the WWII generation, and the devastation of the generations during WWI and the Great Depression.

And the young men and women who have served overseas (especially in war-torn environments) could also paint a compelling picture of what REAL devastation looks like.

I don’t minimize the great battles that many of my Massachusetts clients and friends are facing in saying this — if anything, I offer it as a beacon of hope. Because these times are indeed extremely difficult for so many.

But we will rise above, I’m certain.

Starting this week, I’m returning to my previous “Real World Strategy Note” format, for the sake of offering you some digestible, actionable information about relevant topics.

And this week, let’s talk about mortgages…

The Important Details of Mortgage Forbearance For Massachusetts Taxpayers

“The only way around is through.” – Robert Frost

With unemployment numbers through the roof (officially at 14.7 %, though the real numbers are likely to be much scarier), millions of homeowners are seeking various forms of mortgage relief.

If you are currently struggling, and your June payment looks dicey, my advice to you: be very careful.

Recent numbers that I’ve seen from the real estate data firms indicate that as of last week, 4.6 MILLION mortgage holders were in some sort of mortgage forbearance — which is up from 150,000 or so in early March.

And that number is likely to already be significantly higher.

Now it’s true — the federal government has made it possible for borrowers with government-backed mortgages to suspend their payments for up to a year without immediately paying it back.

But there’s a key phrase in there: “government-backed”.

That’s because about 30 percent of homeowners have mortgages that are owned by banks or private investors, which are not governed by the same rules.

If this is the case for your mortgage, you might be on the hook for the FULL amount of what you have deferred at the end of your mortgage forbearance period (which is often three months).

Yikes.

The mortgage companies are all offering these options right on their home pages, and some do a better job than others of spelling out the terms.

But I urge you: make sure you understand the terms of repayment before you enter into this agreement.

The good news is that there will be ways through these problems (extending terms, renegotiation, etc.), but they can be cumbersome and paperwork-heavy.

And we’d be happy to help you figure out any tax and financial implications of these decisions as well.

In the meantime, I’ll leave you with some resources:

  • Here is a guide to mortgage relief options from the Consumer Financial Protection Bureau — and they are offering a tool to find out who owns your mortgage.
  • HUD offers a list of housing counselors on its website (or you can call 800-569-4287 if you like really long hold times), and so does the Consumer Financial Protection Bureau. HUD-certified counselors often (but not always!) offer their services free of charge because they receive funding from the government.
  • Here is a directory of mortgage servicers. These companies are generally required to contact you 30 days before your forbearance period ends to work out the terms with you. If you don’t get that call, or you want to get ahead of the game, you can contact them yourself.
  • Here is a good resource of potential additional protections you might find useful.
  • If all else fails, and you aren’t making progress with your servicer, you can file a complaint with the Consumer Financial Protection Bureau. Your complaint will get forwarded directly to the company and they will work on your behalf to at least get a response, generally within 15 days.

I hope this helps!

Don’t forget … we’re in your corner.

And, of course, feel free to send this along to your Massachusetts friends who might need help, especially when it comes to dealing with the tax-related issues all of this might bring up.

That’s what we do!

Warmly,

 

Russ Victor

(781) 767-7473

Rusself Victor, CPA, PC

 

 

“CRISIS Action Plan” for my clients and friends:

1) Don’t marinate in other people’s panic. Be mindful of your social media consumption.

2) Continue to stay financially and logistically prepared for worsening situations.

3) Make sure you have some ready, liquid assets, if you are able. (I.e., cash in the bank, and in hand.)

4) Set aside plans for any big spending until the dust settles — but especially look out for your small business owner friends and vendors.

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