James Pantzis on 5 MORE Bad Money Habits And How To Overcome Them (Part 2 of 2)

James Pantzis on 5 MORE Bad Money Habits And How To Overcome Them (Part 2 of 2)

With all of the chaos that we are seeing bubble up around us, both in our nation and overseas, it can feel like everything is in flux.

Please, though … if you’ve established for yourself a hedge against financial turmoil, let’s not have you ruin it.

Last week, I posted an article which addressed these issues. It was a bit controversial, but I’m also glad to say that it was very well-received.

You see, in days like we’re facing, it might be a common temptation for my wealthy clients and friends to succumb to wrong thinking — the kind of thinking which they successfully avoided in order to attain the wealth they’ve achieved.

So, I had thought it appropriate to put together a small series on “right thinking”, when it comes to your resources, and this is the second part (of 2).

I’d love your thoughts, again, by the way…

James Pantzis on 5 MORE Bad Money Habits And How To Overcome Them (Part 2 of 2)
“Putting off an easy thing makes it hard. Putting off a hard thing makes it impossible.” – Charles E Wilson

As I mentioned last week, through the course of our work with many successful Brooklyn clients, I’ve made an unintentional — but close — study, over the years, of how money “works”, and just what it is that propels certain individuals and families into great quantities of resources … and what also brings them down.

I hate to see those with resources squander them, simply because they fell prey to the rampant fear.

Watch out for it in your own heart, in that of your children and spouse — and avoid these common behaviors of the poor:

6. Using credit habitually for “lifestyle” purchases: Delayed gratification isn’t something that they’ve heard of, and if they want something, they just put it on credit. After all — it’s at a 0% interest rate for the first 3 months! One purchase leads to another, and before they know it, they’ve got thousands in credit card debt. Debt loads in the wealthy can look different, but the principles remain the same. Avoid leverage these days; keep your powder dry. Your lifestyle isn’t worth expensive cashflow.

7. Always paying more than you have to: Often people who are broke have gotten there because they don’t know how to shop for a deal, negotiate or ask for a discount. You can get a discount on just about anything — from electronics to health care. Never pay more than you have to.

Why is it that the wealthy take perverse pride in paying full retail? It goes before the fall, as they say … so don’t become penny-wise/pound-foolish — but neither should you eschew effective negotiation in multiple categories.

8. Falling prey to lifestyle inflation and “keeping up with the Joneses”: This is a biggie for the wealthy. Even people with higher incomes have problems with staying ahead in their budget because they fall prey to lifestyle inflation. Instead of banking and saving raises, they raise their standard of living — buying a bigger, better house, a new car and a new wardrobe. They feel like they have to keep up appearances with everyone in their neighborhood.

Take a good hard look at what motivates your purchasing, and clean out the dustbunnies of comparison, lest they fill your brain with poverty-thinking.

9. Relying on others to fix your problems: We’ve probably all known someone who is always going to their parents, family or friends to bail them out. They create a pile of debt, and then rely on the kindness of others to get them out of their bind.

10. Forfeiting future gains for fun today: These people often have a hard time visualizing how saving and hard work will pay off down the road, and instead live for the fun and pleasures of today. They don’t realize how saving for tomorrow can improve their quality of life today.

Don’t sacrifice your retirement on the altar of present-ease.

Obviously, I’d like to help you move past these behaviors, if any apply. You may not carry every one of these traits, but just one or two can get you into hot water.

If you feel that you’re slipping into any of these bad money habits, please do let us know … we’re here to help as your Family’s Personal Financial Guide.

I am, warmly, yours,

James Pantzis
(718) 858-9864

James Pantzis, CPA, PC

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James Pantzis Reveals 5 Ways We Avoid Keeping Better Money Habits

James Pantzis Reveals 5 Ways We Avoid Keeping Better Money Habits

We spend a disproportionate amount of our time around the Team Pantzis offices dealing with government forms and websites.

(Seriously though — can you or I get a gig as a web designer for the government? Those contracts run in the 7 figures … and the designs still look like something built using dial-up.)

But the annual release of this page is pretty fun: behold, the most popular baby names of 2014! (from our phone-and-form friends at the Social Security Administration) http://1.usa.gov/1HcO6ux

Now, moving from the sublime to the weighty: Sometimes it feels like all we face is turmoil. And this feeling is not restricted to those who live “month to month”.

This is especially true if we follow all the Facebook rabbit trails (at least the ones that don’t involve baby names) — it seems like much of the media is perversely incentivized to keep us discontent.

I have spoken of this before.

But it’s not just the media.

You see, I sit down every week with Brooklyn families across a wide spectrum of financial means, and sometimes I notice something interesting, even in the families of those with great resources: “poor” thinking.

With all of the seeming turmoil, it might be a common temptation for my wealthy clients and friends to succumb to this kind of wrong thinking — the kind of thinking which they successfully avoided in order to attain the wealth they’ve achieved.

So I thought it appropriate to put together a small series on “right thinking”, when it comes to your resources. It may be a bit controversial, but I do hope you receive it in the spirit with which I write…. (And, as usual, I’d love your thoughts!)

James Pantzis Reveals 5 Ways We Avoid Keeping Better Money Habits
“Success is to be measured not so much by the position that one has reached in life as by the obstacles which he has overcome.” – Booker T Washington

In my line of work, I get to have deep and meaningful conversations with families about the things which they most care about. I LOVE those conversations, and I believe that understanding these deeper passions is “the only way to fly”, when it comes to financial work of any kind (be it tax, or otherwise).

Now, as I do so, I also run into people’s attitudes about their wealth.

I’ve made an unintentional — but close — study, over the years, of how money “works”, and just what it is that propels certain individuals and families into great quantities of resources … and what also brings them down.

You see, sometimes the very wealthy begin to act like they’re poor.

It’s the beginning of a bad problem. And, it’s also something to watch out for in your children — because it will give you a clear picture about what might happen should you bequest your resources to them without a clear plan. I’ve compiled a group of behaviors characterizing the financially-strapped. Avoiding these pitfalls will help you keep better money habits.

You may have resources NOW, but are you …

1) … spending money on things you really don’t need?
I’m sure we’ve all got one of those friends who just loves to spend money, and buy things just to say they have them. The newest iPhone just came out? They buy it even though they already have an older version. A new TV came out with a higher refresh rate than their current one? They buy one so they can say they have the newest and latest technology.

That may be fine for a certain amount of time, but there is something deeper happening in the heart there, which, if left unchecked, can signal a decline in wealth. Because it starts with the iPhones … but where does it end?

2) … ignorant about where your money is going?
Far too often people who are broke find themselves short because they’ve never tracked their monthly cash flow and their small expenses are adding up to consume everything they bring in. They really need to track their expenses for a month or two so that they can set up a plan.

But the wealthy sometimes begin to believe that they’re immune to such proletarian concerns, and allow the same bad habit to encroach into their portfolio. Don’t let up — but, of course, don’t fall into obsession. (E.g., are you checking your accounts every day? That’s also a problem!)

3) … blaming your problems on outside forces?
People don’t like to see themselves as the source of their problems. While people certainly have problems that aren’t caused by something they’ve done, far too often they will also try to shift blame when they should be looking at themselves. They blame their friends, family and the government. They believe that “the little guy just can’t get ahead”.

Are you doing the same thing? “It’s the market’s fault!”, “My financial advisor screwed me over!”, etc., etc. … again, signals of a deeper problem.

4) … more interested in having others think you are wealthy, than actually being wealthy?
People who are always broke like to be seen as wealthy and successful, even if looking that way to others means that they’re actually forfeiting the possibility of being wealthy in reality.

Are you pumping your resources into an image? Are you “investing” in items which, really, are more about how people will see you than how they will help your net worth?

5) … not planning ahead?
For the poor, money is short because they haven’t set up a family budget, and a saving and spending plan. When they set up a monthly cash flow forecast, and know exactly what they’re going to spend in what categories — they’ll do much better. If you fail to plan, you can plan to fail, right?

Again, many resources can lead to laziness in this area. Don’t let up with it.

I will have more to say on this topic next week.

Until then, I do hope you receive this in the affection with which I wrote it.

I am, warmly, yours,

James Pantzis
(718) 858-9864

James Pantzis, CPA, PC

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Pantzis’ 8 Essentials For Record Keeping

Pantzis’ 8 Essentials For Record Keeping

I get pretty excited about the spring. All around the country, the snow is gone, the trees don’t seem so desolate … and am I right that the angle of the sun is a bit less harsh?

Or maybe it’s just because tax season has finished and I’m getting more sleep? :)

Well, I hope you and your family will have some “spring” this year — in the more figurative sense; whether or not it’s in the next couple of months. The winter always seems longer than it really is (even when it really *is* long!), but I’m also reminded of how necessary it is.

You see, like the lifecycle of an economy, I still believe that it’s a *good* thing to experience a time of dormancy. Speaking biologically, plants and flowers often need that time of “being withdrawn” to survive the “facts on the ground” (really cold temps).

It’s a classic picture of a healthy cycle — pull back a little when it’s harsh, but look for the warmer temps and be ready to bloom.

I don’t know all the details of your personal situation. But I do know that you and I have a choice about how we’re gonna weather our different financial seasons. Keep acting like it’s summer (when it’s really winter out there), and you’ll wither, and suffer for it.

But the opposite is also true — keep staying “shut down” and dormant when the weather is turning up … and, well, you’ll miss your chance to really grow up and blossom.

Fine — I’m a tax pro, not a poet, but you get the point. Don’t be afraid to step out again, just because it’s been cold for awhile out there.

And one of the best ways to KNOW if you can do this is to keep the essential information at hand …

Pantzis’ 8 Essentials For Record Keeping
“Success is simple. Do what’s right, the right way, at the right time.” – Arnold Glasgow

Now’s the best time to get rid of unnecessary paperwork, as well as to ensure that you caught everything for your 2014 tax return.

But before I get to what to do if you find something pertinent to your recently-filed tax return, here are 8 essentials for record keeping (and how long to keep them)…

1. Taxes: Seven years
Pantzis’ Reasons Why:
There are three, actually:
1) The IRS has three years from your filing date to audit your return if it suspects good-faith errors.
2) The three-year deadline also applies if you’d like to make some sort of amendment because you discover a mistake in your return and can claim a refund.
3) The IRS has six years to challenge your return if it thinks you underreported your gross income.
All this adds up to keeping that info for seven years. Beyond that, there’s no reason — except for posterity.

2. IRA contribution records: Permanently
Pantzis’ Reasons Why:
You’ll need to be able to prove that you already paid tax on this money when the time comes to withdraw.

3. Bank records: Usually just one year
Pantzis’ Reasons Why:
Those related to your taxes, business expenses, home improvements and mortgage payments will obviously need to be included for next year’s taxes. But unless there is some sort of emotional or posterity reason, get rid of everything after one year.

4. Brokerage statements: Until you sell
Pantzis’ Reasons Why:
To prove whether or not you have a capital gain or loss for tax purposes; after this point, shred it.

5. Household bills: From one year to permanently
Pantzis’ Reasons Why:
When the canceled check from a paid bill has been returned, you can shred the bill with a clear conscience. However, bills for big purchases — such as jewelry, rugs, appliances, antiques, cars, collectibles, furniture, computers, etc. — should be kept in an insurance file for proof of their value in the event of loss or damage.

6. Credit card receipts and statements: 45 days/Seven years
Pantzis’ Reasons Why:
Some families don’t even bother to match up their statements, but if you do so, shred the receipts once you’ve verified everything. There’s no reason to keep everyday receipts beyond this point. For tax-related purchases, you need only keep the statements for seven years — after that, shred it, baby!

7. Paycheck stubs: One year
Pantzis’ Reasons Why:
This is to verify that when you receive your annual W-2 form from your employer, the information from your stubs match. If so, shred all of the stubs … if not, request a corrected form, known as a W-2c. After that’s been handled — shred.

8. House/condominium records: Six years/permanently
Pantzis’ Reasons Why:
You’ll want to keep all records documenting the purchase price and the cost of permanent improvements — such as remodeling, additions and installations as well as records of expenses incurred in selling and buying the property, such as legal fees and your real estate agent’s commission, for six years after you sell your home.

Holding on to these records is important because any improvements you make on your house, as well as expenses in selling it, are added to the original purchase price or cost basis. Therefore, you lower your capital gains tax when you sell your house.

Now, in this cleansing process, sometimes, you’ll find a receipt or a documentation which really would have changed your prior year tax return. That’s when you might have us file an Amended Return. However, this decision should be balanced against the cost of doing so, as well as the expected benefit — often these items can be dealt with the following year.

But here are some other, common reasons to amend…

* You neglected to report some income earned.
* You claimed deductions or credits you should not have claimed.
* You did not claim deductions or credits you could have claimed.
* You filed under one filing status, but you should have filed under another.
* You bought a residence and didn’t claim the First Time Homebuyers Credit (or other credits available).

If you find something like this, let us help you. (718) 858-9864

Regardless, let this be a cleansing process for you, and sleep easy knowing you’ve handled this stuff properly.

Oh, and make sure you use a good shredder!

And for those of our clients who have previous years’ tax returns at another preparer, OR for their friends…

+++++++++++++++++
“No Charge” Return Review
Special
Offer
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. Email our office (using the email button at the top of this page) or call (718) 858-9864 to set up this complimentary service!
Deadline May 8th
+++++++++++++++++

To more of your money staying in your wallet…

James Pantzis
(718) 858-9864

James Pantzis, CPA, PC

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James Pantzis Explores Five Markers of Financial Health at Mid-Life

James Pantzis Explores Five Markers of Financial Health at Mid-Life

If your tax returns have been filed (as most of our clients’ have), I do hope you’ve taken the ripe chance afforded to you to scrutinize your year, and your financial health. And, even if you’re on extension, it’s good to pause here before summer and consider where you’re headed — financially, and otherwise.

So, I thought that this could be the perfect time to help our Brooklyn tax preparation clients through a little check-up.

(One nifty little tool I ran across last week might also encourage you in your marriage — or, well … it could perhaps give you fuel in that you are doing something worthwhile, even when it comes at a cost!

The stat site, FiveThirtyEight created an interactive graphic to help us see the implications of our tax policy on families (specifically, marriages). Enter you and your spouse’s income, and you can see whether your marital status is providing you a “bonus” or a penalty, under our current, convoluted tax regime. –>http://53eig.ht/1GABRri )

So, even including marital status in the mix, I’d like to give you an objective, “incentive-free” look at what your finances should look like when you hit the half-century mark. If you are close to that mark, I thought it might be useful for me to lay out the “perfect” scenario. If you’re on either side of it, you can see where you’re headed, or from where you should be coming.

And look — if you’re not perfect, at least let it be a benchmark…

[And don’t neglect what I’ve included at the end, especially where your friends may be concerned …]

James Pantzis Explores Five Markers of Financial Health at Mid-Life
“Don’t give up. Keep going. There is always a chance that you stumble onto something terrific. I have never heard of anyone stumbling over anything while he was sitting down.” – Ann Landers

Finances should be viewed as “clear-eyed-ly” as possible, don’t you think?

So, that being the case, let’s set up a landmark on our map towards financial health, shall we? It’s great to know where you should be headed … or, from what place you should be coming.

Here are five signposts for your mid-life financial life …

1) Your estate plan should be fully in place.

Of course, various assets are handled differently. This is the time to make a complete review of how your plan is put together, to ensure that EVERY asset (not just the tangible ones) are still handled properly.

Intangible assets can include such things as what you are passing down to your children in terms of “family ways” and values that you would like to see spreading down throughout your generations. This is an important step at midlife.

2) If college is paid for, consider dropping term insurance.

At this stage of life, it becomes more costly to pay for this service. You are probably at the point where your children are nearing the completion of their education.

Remember that you purchased “peace of mind” (term insurance is not an investment) so that if anything were to happen to you, your home and your children’s education could be paid for. If those things are now moot, it may be time to re-evaluate.

3) Evaluate where you are with your saving and investing.

You may not want to retire for quite some time yet. That’s a wonderful place to be. But you should be considering whether you have saved up enough to match your desired lifestyle spending. It’s a good rule of thumb that you should have saved about 8-10 times your annual lifestyle spending at this point.

If you haven’t?

4) Catch up on your savings.

At age 50, maximum savings in a 401(k) or 403(b) account increases from $18,000 to $24,000 in 2015 (it was $500 less for each amount in 2014). At age 50 or older, Roth contributions also increase from $5,500 a year to $6,500 with these “catch-up” provisions. If we don’t have eight times our lifestyle spending saved, now is the time to press these limits.

Of course, saving well is half the battle; investing well is the other half.

That’s a subject for another day.

5) Lastly, begin considering what you really want out of retirement.

Consider that living a life of purpose doesn’t necessarily mean decades of simple recreation.

Reaching the place where you don’t “have” to work is a wonderful marker of true financial success. But you can make the decision to view your retirement years as an opportunity to do new, meaningful work. Commit yourself to a non-profit, or a ministry endeavor. Find ways to strategically invest your time and your energy into a different work that matters (aside from your first-half career).

Although you can have that attitude at any age, it is especially powerful when redefining the second half of your life.

And don’t forget to email me (you can use the email button at the top of this page) a quick note about your experience with us this year! THANK YOU!

And for those of our clients who have previous years’ tax returns at another preparer, OR for their friends…

+++++++++++++++++
“No Charge” Return Review
Special Offer
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. Email our office (using the email button at the top of this page) or call (718) 858-9864 to set up this complimentary service!
Deadline May 8th
+++++++++++++++++

To more of your money staying in your wallet…

James Pantzis
(718) 858-9864

James Pantzis, CPA, PC

Read More

James Pantzis Answers “Where’s My Refund?”, And Other Questions For After Your Return Is Filed

James Pantzis Answers “Where’s My Refund?”, And Other Questions For After Your Return Is Filed

This is never a very fun “holiday”, but it’s worth marking every year.

Friday, April 24th is our National “Tax Freedom Day” — that’s the date by which you’ve finally worked enough days just to pay off your taxes for the year. The rest of the year is your “take home” pay, as it were. :(

This date includes payroll taxes, sales taxes, property taxes and, of course, INCOME tax.

The date varies year to year (this year it is one day later than last), and a whole variety of interesting data is right here: http://taxfoundation.org/article/tax-freedom-day-2015-april-24th

And for some states, the date is even later. Here’s the state-by-state breakdown:http://taxfoundation.org/sites/taxfoundation.org/files/docs/Map%20of%20Tax%20Freedom%20Day%20by%20State.png— that’s a useful snapshot, actually, of a fuller picture of whether “low tax” states actually are low tax (because it takes more into account than just income taxes) … and it might surprise you.

The calculating organization is the Tax Foundation, a non-partisan educational organization dedicated to informing US — the taxpayers — about the burdens of our tax liabilities. And according to the Foundation, here’s a fun little fact: Americans paid more taxes in 2014 than they did on food, clothing and shelter combined.

Which, of course, is why I and my Brooklyn tax preparation staff are here: keeping your tax bill as low as legally and ethically possible.

Regardless, here at Team James Pantzis we’re beginning the process of serving you during the “off season” (there are always many new tax law changes coming), and we’re evaluating how things went.

We also deal with lots of questions this time of year related to a variety of “post-preparation” issues (like “Where’s my refund?”), so I thought I’d address many of them in one swell foop ;).

Which is not at all to say that we won’t answer YOUR questions. Here’s our number: (718) 858-9864

On to the questions…

James Pantzis Answers “Where’s My Refund?”, And Other Questions For After Your Return Is Filed
“Friends are those rare people who ask how we are, and then wait to hear the answer.” – Ed Cunningham

The dust has settled around here at Brooklyn Tax Planning and Preparation Central, and your return is filed. At least, of course, if you didn’t file for an extension.

It does feel nice, even if more money was owed than you would like … because it *is* completed, after all.

But that doesn’t mean you may not still have questions. Here are some common ones we get this week…

1. “Where’s my refund?”

Well, the IRS does seem to have entered the 21st century.

If you had us “e-file” your return, you can check your status right now, or if you had us mail a paper return, after about 3 to 4 weeks.

When you’re checking with the following options, make sure you have a copy of your tax return on hand or know your “filing status”, SSN and the exact dollar amount of the anticipated refund.

Online: Go to IRS.gov and click on Where’s My Refund.
[or go right to: https://sa2.www4.irs.gov/irfof/lang/en/irfofgetstatus.jsp ]
Automated Phone: Call 1-800-829-4477 24 hours a day, 7 days a week for automated refund information.
In-Person Phone: Call 1-800-829-1954 during the hours shown in your IRS form instructions. [Of course, the hold time for the IRS is … somewhat of an issue]

2. “Do I need to keep a copy of my return?”

Yes, for a *minimum* of three years, but I recommend forever. There’s all kinds of contexts where it’s useful. We do keep one on file, on your behalf, but it’s just smart and safe for you to keep one in a secure place at home. (I’ve already written about Amended Returns, and you need a copy for that process, of course.)

As for the supporting documents from your return, anything that relates to a home purchase or sale, stock transactions, retirement, business or rental property, should be kept much longer than the three years.

I’ll give even more guidance on this issue in subsequent weeks.

3. “I think there’s a mistake in my return. What should I do?”

Sometimes, you’ll find a receipt or a documentation after April 15th which really would have changed your prior year tax return. That’s, again, when you would have us file an “Amended Return”. Here are some other, common reasons to Amend…

• You neglected to report some income earned.
• You claimed deductions or credits you should not have claimed.
• You did not claim deductions or credits you could have claimed.
• You filed under one filing status, but you should have filed under another.

You might have other questions, which I haven’t addressed here. Let me know!

To more of your money staying in your wallet…

James Pantzis
(718) 858-9864

James Pantzis, CPA, PC

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A Heartfelt Thank You To Our Brooklyn Tax Preparation Clients

A Heartfelt Thank You To Our Brooklyn Tax Preparation Clients

The loudest thing I want you to hear from this post is this: THANK YOU for your trust, Brooklyn.

Our primary work for this tax season has just about wrapped up.

But notice I said “primary”, there … you see, unlike some tax professionals, we make it a point to do a bit more than simply “fill out forms” on your behalf. I’ll tell you more about that in a moment.

It is no small matter to place your financial life in front of another, and I know that for some it can bring with it some anxiety or discomfort. That’s why we work so hard to be people that you can trust for even more than just a simple “filling out some forms” service.

It’s why I make it a point to post these notes every week (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.

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

But this work also brings with it a certain joy — because this past season, we 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 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 Brooklyn taxpayers this tax “season” … and we look forward to years of service to come.

Lastly, I hope you’ll forgive me for taking a break from writing you a Personal Strategy Note for this week … I’m not sure that if I did so, anything besides numbers and spreadsheets would come out. It’s amazing what 4 months of staring at government forms does to a brain!

But hey — this is what we signed up for. And we are extremely grateful for your trust, and for the chance you’ve given us to serve you in it, so you don’t have to suffer the same fate.

We will be in touch again soon. Hopefully, we’ll be able to taper off the newly-intense coffee addiction around here enough to write you clearly in the future!

[And, as I mentioned above … we’re not letting up! We’re committing the “offseason” to continue our education related to more ways to save you on your bottom line, 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 affection, and until next week …

James Pantzis
(718) 858-9864

James Pantzis, CPA, PC

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Pantzis’ Tax Extension Cheat Sheet

Pantzis’ Tax Extension Cheat Sheet

This has been an intense tax season.

For those of us in the tax professional community, there have been emails, message board postings and blog posts flying about the difficulties that many have been facing with regards to all of the additional paperwork called for in the ACA (“Obamacare”)regulations — not to mention the normal round of new tax law changes that we saw.

But you know what has kept me sane? You.

This is the busiest week of our year, this last full week, and we continue to experience graciousness, warmth and encouragement from our clients. I’d like to think that it’s purely because we do such an excellent job, but that wouldn’t quite account for all of it.

We have the best clients of any tax professional firm in the nation, and realizing this, as we have, makes this next week or so vastly better, and more encouraging.

So, before I get to the content of what I have for you today, I wanted you to know how we have been feeling about YOU (among others). More about this soon.

Now, a couple quick reminders about what ELSE April the 15th means…

1) Wednesday, April 15th is the deadline to contribute to IRA’s, etc., in order to have them count on this year’s (2014) taxes.

2) It is also the deadline to claim the almost $1BN in unclaimed refunds for returns dating back to 2011. If you, for some reason, didn’t file for that year, you could be missing out. Call us for this special circumstance: (718) 858-9864
(Or for any other question — but again, bear with us, as we are extremely busy!)

Pantzis’ Tax Extension Cheat Sheet
“Successful people are always looking for opportunities to help others. Unsuccessful people are always asking, ‘What’s in it for me?'” – Brian Tracy

There is a lot of confusion, every year, about filing a tax extension, so allow me to share what it’s REALLY about …

As you know, Wednesday, April 15th 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) Form 4868 (Automatic Extension of Time to File —http://1.usa.gov/1DcfWno) with the IRS by the end of the day on the 15th. This gives you an automatic six-month (until October 15, 2015) extension of time to file.

Here’s the bottom line: An “Extension of Time to File” is not an “Extension of Time to Pay”, unfortunately — except for certain cases (more on these in a moment). In normal circumstances, 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!

The exception to this rule is for:

1) Those who have served in combat zones during any taxable events (including earning income) are given the same amount of time they served in the combat zones + 180 days — and this applies to filing *and* paying those taxes. More information for those affected by that is here: http://1.usa.gov/1IDkuTE

2) Any US citizens or resident aliens who live and work abroad automatically have until June 15th to file and pay their taxes (unless already covered by my first provision above)

3) If you have been affected by certain natural disasters. The official list is here:http://1.usa.gov/1FvZrlv

So, if that’s you — let us know. We’ll help you get the relief you need.

For the rest of you, 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 (or various body parts). 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 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.

James Pantzis
(718) 858-9864

James Pantzis, CPA, PC

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James Pantzis Shares On Overcoming Procrastination

James Pantzis Shares On Overcoming Procrastination

I’ve heard rumors that (for some unknown reason) many people don’t like to file taxes?

It appears that most folks do NOT like to fill out reams of paperwork only to finally discover how much money they are really giving to the IRS!

This, of course, is why we work so hard — to make this process as painless as possible, and to ensure that you keep all the money you deserve to keep, legally and ethically, under the current tax code.

And we’re in full “all-irons-in-the-fire” mode around here these days, with two weeks left to go in tax season.

James Pantzis Shares On Overcoming Procrastination
“Cultivate the habit of being grateful for every good thing that comes to you, and to give thanks continuously. And because all things have contributed to your advancement, you should include all things in your gratitude.” – Ralph Waldo Emerson

When your day wraps to a close, are you leaving tired and satisfied? Or just … tired?

You’ve spent the day in nearly constant activity.

And you may have been procrastinating the whole time.

“Huh?” you say, “I can’t have been procrastinating. I’ve been really busy!”

But there’s the rub: when we’re busy, we can easily trick ourselves into thinking that all of that activity means we’re not procrastinating. Yeah, we’re busy — but we’re not focused on the things that should really have our attention. If someone were to tap us on the shoulder and say, “that thing you’re doing — is that the best use of your attention right now?,” we would hesitate to agree.

We’re busy procrastinating.

The explosion of digital channels and the mobile web makes it very easy to integrate busy-ness and procrastination. There are a lot of “channels that lead to you.” Email, sure. But also Facebook and Twitter and instant messaging and LinkedIn and … etc., etc.

The inputs from these channels come at us thick and fast. That makes it tempting to let the real-time arrivals drive us. Procrastination is always only a click away.

But ask yourself: what are the odds that email at the top of your inbox is the best thing to focus on next? If it’s not, and you choose to deal with it next anyway, then you’re being driven by “latest and loudest,” and are letting your channels dictate your priorities.

So, if you’re set on overcoming procrastination, then what should you do? To get it under control, we need to make getting moving on the right things as attractive as possible.

Procrastination usually boils down to: 1) Not Thinking or 2) Not Doing. Here’s how to beat each…

1) Not Thinking.
I’m avoiding thinking about things I know I should think about.

There can be all kinds of reasons we don’t want to think about a given item, or issue. Whatever the reason, it is usually because of the size or complexity of the issue.

So, boil it down to its contingent parts, and address the smaller issues within the larger whole. Ask yourself: What’s the exact, smallest action that can be taken to move this forward? And, What do I want to see happen from that action? You can always address those questions.

Which leads to…

2) Not Doing.
I’m avoiding doing things I know I should be doing.

Again, break it down into something smaller. Take the tiny action, do it again … and you’ll find yourself suddenly settled into taking the larger action you had been putting off in the first place.
Here’s one small action…

Consider us “The Ultimate Procrastination Solution”.

Allow us to take the pain away from that big pile of forms and obligations … and allow yourself to move into sustained action on those bigger things.

James Pantzis
(718) 858-9864

James Pantzis, CPA, PC

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James Pantzis Reveals 6 Common Tax Preparation Mistakes That Could Get You Audited

James Pantzis Reveals 6 Common Tax Preparation Mistakes That Could Get You Audited

Spring has officially sprung and we’re working like busy bees on client tax returns these next few weeks before April 15th, and I would like to say: if you have not yet done so, we need to get your information to complete your return as soon as possible.

This has been a very busy season … so as much as you can enable us to do our work on your behalf, the better.

Give us a call: (718) 858-9864 or contact us.

You need someone on your side who can fight for you.

More and more municipalities (states, cities, the federal government) are looking into every corner possible for additional cash, and not just those who are facing bankruptcy.

And one way they do so is to scrutinize … you.

James Pantzis Reveals 6 Common Tax Preparation Mistakes That Could Get You Audited
“What is once well done is done forever.” – Henry David Thoreau

Sometimes clients come to us from other professionals because they have gotten themselves in hot water with the IRS, and they’re facing the withering gaze of the auditors.

We don’t want that to happen for you — so here are 6 common tax preparation mistakes we watch out for when preparing and submitting your tax returns…

1. Indefensible claims
There are so many old wives’ tales saying that certain items trigger an audit: home office deductions, passive losses, schedule C (sole proprietorship) activities, etc. But you really can’t predict the trigger (and you can drive yourself crazy trying), but you *can* adopt the “be reasonable” mantra about every item on your return, including these. So if you don’t have a decent claim for a home office, don’t claim it. If your money-losing sole proprietorship is really more of a fun hobby, treat it as such.

Look–don’t be scared to take deductions and losses you’re entitled to, but don’t take tax positions you aren’t comfortable defending. If you take reasonable tax positions, you’ll likely find you won’t end up needing to defend them. And if you do face an audit, it will likely be far easier.

2. It doesn’t all add up.
This seems like it should go without saying, but make sure you add, subtract and multiply accurately. Check your numbers through each step and do some simple math checks when you finish. If you do make a math mistake, you are likely to get a math correction notice from the IRS. This isn’t an audit. But your goal is to minimize your interaction with the IRS bureaucracy, which, ah… isn’t known for the best mail handling practices.

3. Lost 1099
This can be confusing, because the Form 1099 comes in many varieties, including 1099-INT for interest, 1099-DIV for dividends, 1099-G for tax refunds, 1099-R for pensions and 1099-MISC for miscellaneous income. These forms are sent by payers of such funds to both you and the IRS.

So regardless of how many 1099s you receive, make sure they all are accounted for on your return. There are also Forms 1098 which lenders send (to you and the IRS) recording how much interest you paid. The IRS matches your return against the 1098s and 1099s. So one sure way to guarantee an IRS query is to fail to account for something! If a Form 1099 is wrong–say it reports more income than you had–you can explain or deduct it on the return, but you need to first report it.

4. Suspicious OVER-reporting
I’m not talking about under-reporting income, or holding necessary information back. But you’d be surprised how many professionals and amateurs alike try to submit too much *supporting* information. True, if your return is complex, you may need to add explanations or disclosures in footnotes. Be concise, truthful and accurate, but don’t provide copies of sales agreements, settlement agreements, bank statements, etc., unless you are later asked by the IRS to do so.

Disclosures can be made on regular paper or special IRS forms. A Form 8275 “Disclosure Statement” on plain paper can be used any time you need to disclose something that can’t be adequately disclosed on the forms. Form 8275-R “Regulation Disclosure Statement,” is for disclosing positions that are contrary to IRS Regulations or other authority. You shouldn’t be filing a Form 8275-R–or taking a tax return position that would require it–without professional help.

5. Fighting unnecessary fights.
If you take reasonable tax positions, and complete your return accurately, checking your math, why should you pay a bill if the IRS sends you one?

Frankly, it’s simply a matter of practicality (and wisdom) rather than principle. It just doesn’t pay to fight with the IRS on small matters. So don’t get into the bureaucratic system and risk bigger problems for a few dollars. Just pay it and move on.

6. Ticky-Tack Prior Year Amending
Here’s the reverse situation of my previous point: amended returns are reviewed much more regularly than initial returns. So if you forgot a deduction or otherwise think you can get a small amount back by amending, think twice before amending your return (i.e. — consult with a pro). Consider whether you might have bigger problems if other matters on your return, unrelated to the amendment, are reviewed. Yes, you can win a battle … and lose a larger one.

And a last word: No matter how careful you are to avoid tax preparation mistakes, there’s no way to guarantee you’ll never have a tax controversy. Sometimes your number just comes up.

And if your number is called, well, we’re here to walk with you …

(But we’ll do everything in our power to make sure it’s NOT called!)

Warmly,

James Pantzis
(718) 858-9864

James Pantzis, CPA, PC

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Once Again, James Pantzis’ 2015 Tax Time Document Chase List

Once Again, James Pantzis’ 2015 Tax Time Document Chase List

Brackets, brackets, brackets.

Depending on when you read this, you may have already filled yours out (or it may already be busted!). Billions fly around every year (probably much of it not reported on Form W-2G!), and it’s become a huge part of this season, as you no doubt know.

You know what else is a big part of this season? Unclaimed refunds.

Every year, we get the number from the IRS, and it always hovers around $1B. That’s where it is this year: http://cnnmon.ie/1wQECRl
There’s buckets of the green stuff sitting in accounts, waiting for those unsuspecting non-filers to realize that it’s actually theirs. DEADLINE: April 15.

If you didn’t file taxes in 2011 (i.e., during the spring of 2012), now is your last chance. Allow us to help you do so by either reviewing a prior year’s return which somebody else submitted for you, or by evaluating your financial records if you didn’t actually file a return that year. It’s amazing how many people that is true for.

Lastly, in the interest of having this NOT happen for you, let’s make sure you do it right for THIS year.

In early January, I posted a “checklist”, and it was one of my most popular messages. I guess it was handy. And now is a time when many are finally getting around to this, so I thought I’d share it again.

Putting together this list may run slightly counter to my business goals — after all, we do get paid to do this on behalf of clients! That said, our mission is to ensure that EVERYONE in the local area saves the most possible when the IRS comes calling. Some of these may seem small, but trust me when I say that they add up.

Once Again, James Pantzis’ 2015 Tax Time Document Chase List
“So many fail because they don’t get started; they don’t go.” – W Clement Stone

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 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 (New for 2015)
* 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 hope this helps, and we really look forward to seeing you in here in 2015!

Warmly,

James Pantzis
(718) 858-9864

James Pantzis, CPA, PC

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