I believe I have written about this before but it bears repeating. The IRS will never call you. Never. Never. Never. The IRS agent wants to know that he is talking to the taxpayer in question and he can't know that if he makes a phone call.
If the IRS contacts you it will be with a Registered Letter that you will have to sign for. That's the way they work. They do not want the taxpayer to have the option or ability to say, "I didn't know I owed this tax." or "I was never contacted about this matter."
If they call, they could be talking to anyone claiming to be you or it could be you and you'll lie about it later. Not that you would ever do that, but the IRS wants to make sure.
So, if anyone calls saying they are from the IRS and you need to pay some taxes you didn't know about over the phone, just hang up the phone. Or start laughing and hang up the phone. Or better yet tell the caller that you'll need to talk to your CPA and ask for the caller's contact information so you can get back to them. Then hang up and call the police.
And that's another thing, after the IRS doesn't call you, they NEVER take tax payments over the phone by credit card. YOU can contact the IRS payment system -- the Electronic Federal Tax Payment System (EFTPS) either via phone or computer to make a payment if you wish, but the IRS never calls and they never ask for money over the phone. They don't do that.
The IRS will never call you.
Saturday, August 30, 2014
Sunday, August 17, 2014
How to live well on a lower inomce -- Move back in with your parents!
No way am I moving back in with my parents!! Or, yes, that's exactly what I want to do but they don't want me any more. I'm 36 years old and I have no place to go, whaaaaaaaa!!
I'm not talking about freeloading. I'm talking about sharing a home and the expenses.
Maybe neither of you have much money and by joining forces you can improve your standard of living.
My mother and I have been sharing a home for twenty-one years in this last go around. We shared a home for the first 18 years of my life, to which I contributed very little if anything. Then I moved out for about 12 years, somewhat on my own. Whenever I needed a free meal I could always "drop in for a visit". Lucky for my mom, she wasn't that good a cook so I didn't come by every night and eat up her food.
After I was diagnosed with MS, we thought it might be a good idea to move to an area where life was less stressful and we'd be closer to our relatives. We returned to the family stomping grounds, and many a summer adventure for me, and purchased a home that we then renovated into two full houses and a large office space.
We have separate electric and natural gas bills, but share the water and the alarm system. We also have a shared laundry room accessible from either side of the house. The lot is 3/4 of an acre giving us ample room to plant vegetable and flower gardens, put in a swing set for my daughter and grow nut and fruit trees. Now and then the deer and squirrels let us have some fruit and nuts. We also share the cost of the property taxes and property insurance. We insure our cars together for discounts. My mom pays the AAA fee and I pay for the family cell phone plan. The wireless wifi covers my mom's side of the house as well.
Neither of us could live as well if we lived alone. And there are the non-cash extras such as the time my daughter and my mother get to spend together since they live in the same house. The ease we have in caring for each other when sickness hits since we live in the same house.
We do have separate kitchens and buy separate groceries. It works for us and we planned to live together for a long time when we moved in here so we set it up to work with an eye toward both privacy and togetherness.
Maybe your parents have a large home that you have the money to renovate into something workable for both of you. What would it take minimum? An extra bathroom, a small kitchen and a separate entrance. I think both parties need to be able to come and go without going through the other's space and prepare a private meal. Some newer homes are now being planned with an in-law or grandparents suite already included. When one side is no longer needed, the extra home space could be rented or utilized by another relative -- sibling? aunt? uncle? who'd work well in a similar arrangement.
Maybe neither of you has a suitable home and need to sell both current homes and buy or build something new. That's what my mom and I did. Neither of us owned a home large enough to accommodate both of us and an office, so we sold what we had and bought something we could mold into exactly what we needed and raise both our standards of living.
This might not work for you at all, but it's certainly something to consider if making ends meet isn't as easy as it used to be. Living side by side will make it easier to share as many expenses as possible especially the largest -- property taxes, property insurance and the mortgage. Also, if your parent, or you, ever needs someone around to make sure everything is "all right" there's no need to make an extra trip or interrupt the day to check on your parent, just open a door and say hello.
It will take some working out, maybe even some growing up -- for parent and child -- but I don't subscribe to the do-it-all-on-your-own theory. I think families should help each other out as much as they can when necessary. Many things might not be possible but surely a warm, dry place to live with a little food on the table can be achieved with a some forethought and consideration.
And if incomes are low enough, there might be some tax implications to consider. There's nothing wrong with being a boomerang kid as long as you hold up your end of the boomerang.
I'm not talking about freeloading. I'm talking about sharing a home and the expenses.
Maybe neither of you have much money and by joining forces you can improve your standard of living.
My mother and I have been sharing a home for twenty-one years in this last go around. We shared a home for the first 18 years of my life, to which I contributed very little if anything. Then I moved out for about 12 years, somewhat on my own. Whenever I needed a free meal I could always "drop in for a visit". Lucky for my mom, she wasn't that good a cook so I didn't come by every night and eat up her food.
After I was diagnosed with MS, we thought it might be a good idea to move to an area where life was less stressful and we'd be closer to our relatives. We returned to the family stomping grounds, and many a summer adventure for me, and purchased a home that we then renovated into two full houses and a large office space.
We have separate electric and natural gas bills, but share the water and the alarm system. We also have a shared laundry room accessible from either side of the house. The lot is 3/4 of an acre giving us ample room to plant vegetable and flower gardens, put in a swing set for my daughter and grow nut and fruit trees. Now and then the deer and squirrels let us have some fruit and nuts. We also share the cost of the property taxes and property insurance. We insure our cars together for discounts. My mom pays the AAA fee and I pay for the family cell phone plan. The wireless wifi covers my mom's side of the house as well.
Neither of us could live as well if we lived alone. And there are the non-cash extras such as the time my daughter and my mother get to spend together since they live in the same house. The ease we have in caring for each other when sickness hits since we live in the same house.
We do have separate kitchens and buy separate groceries. It works for us and we planned to live together for a long time when we moved in here so we set it up to work with an eye toward both privacy and togetherness.
Maybe your parents have a large home that you have the money to renovate into something workable for both of you. What would it take minimum? An extra bathroom, a small kitchen and a separate entrance. I think both parties need to be able to come and go without going through the other's space and prepare a private meal. Some newer homes are now being planned with an in-law or grandparents suite already included. When one side is no longer needed, the extra home space could be rented or utilized by another relative -- sibling? aunt? uncle? who'd work well in a similar arrangement.
Maybe neither of you has a suitable home and need to sell both current homes and buy or build something new. That's what my mom and I did. Neither of us owned a home large enough to accommodate both of us and an office, so we sold what we had and bought something we could mold into exactly what we needed and raise both our standards of living.
This might not work for you at all, but it's certainly something to consider if making ends meet isn't as easy as it used to be. Living side by side will make it easier to share as many expenses as possible especially the largest -- property taxes, property insurance and the mortgage. Also, if your parent, or you, ever needs someone around to make sure everything is "all right" there's no need to make an extra trip or interrupt the day to check on your parent, just open a door and say hello.
It will take some working out, maybe even some growing up -- for parent and child -- but I don't subscribe to the do-it-all-on-your-own theory. I think families should help each other out as much as they can when necessary. Many things might not be possible but surely a warm, dry place to live with a little food on the table can be achieved with a some forethought and consideration.
And if incomes are low enough, there might be some tax implications to consider. There's nothing wrong with being a boomerang kid as long as you hold up your end of the boomerang.
Friday, August 8, 2014
Why has it been a year since the last post?
Could it be that I've not published an entry because the tax code has not changed?
No, I'm sure there have been a lot of tax law changes in the past year.
Could it be that I've lost interest in this blog or the tax law?
No, that is not the case either.
So what's the reason?
I am only a part-time CPA because my health doesn't allow me to work full-time as I would like to do and as I enjoyed doing before I was diagnosed with Multiple Sclerosis. As you might imagine I've had a very up and down career.
My income consists of annuity payments from investments I was lucky enough to acquire as a disability stop gap before I was diagnosed. But time and the stock market have lowered these payments a great deal from where they started. I still make a small amount of income from my CPA practice but it's difficult to grow a practice when health gets in the way. New clients want a healthy, strong CPA that they can depend on in case of trouble. When the IRS comes knocking, or more likely sends a registered letter, the client wants the CPA to jump right on the case -- not have to schedule it in around health issues.
It's also difficult to know how to charge a new client. Would a healthy CPA have taken this long to finish this task? Was I slower because it's difficult for me to concentrate and I'm tired? I don't want to over bill or do a poor job for a client who expects and deserves only my best.
So, last year I got the brilliant idea of giving a series of lectures to small business people about what to expect in the way of taxes. Of course, they could read books, but I found books too general. Books covered too many topics that had nothing to do with starting a small business in Tennessee.
Alas, the only one who thought this was a good idea was me. No one signed up to come to my seminars. Therefore last August I was faced with some very difficult decisions. Did I go out of business completely for a year, have no income, and then try for Social Security Disability? A pretty big risk. No guarantee I'd quality and after a year, my practice would certainly be dead. Even my most loyal clients would have found another CPA in that time and clients don't switch CPAs easily or quickly.
I had taken on little jobs here and there, my most exciting was stripping furniture at a local upholstery shop. I really loved that job. I could set my own hours, work 10 hours a week and make the extra income I needed. But when the summer came, I could not find a time when it was cool enough for me to get my work done. By the time fall and cooler temperatures came around I was eager to try my new seminar business and all my extra time and energy went into preparing for that. I wrote lectures and prepared handouts. I practiced my delivery and attended Toast Masters and rented a venue.
I learned a lot but nothing that would help me make money in the long run or the short run. More bills were coming due. My line of credit was almost maxed out. When all seemed lost, the local county library received the funding to hire two new part-time librarians and I applied for one of the jobs. I needed a job that had no stress, didn't require a long commute, and that I felt competent to do. I was very lucky to be hired.
So that's what I've been doing. I'm going to try and keep the blog updated more than once a year now that my finances are stabilized. Sorry to be away for so long
And I'm going to change or widen the blog topics. I'm still going to cover tax issues, and feel free to ask questions if you have any, but I'm also going to discuss how to live well on a limited income. I'm looking forward to it, I hope you are, too.
No, I'm sure there have been a lot of tax law changes in the past year.
Could it be that I've lost interest in this blog or the tax law?
No, that is not the case either.
So what's the reason?
I am only a part-time CPA because my health doesn't allow me to work full-time as I would like to do and as I enjoyed doing before I was diagnosed with Multiple Sclerosis. As you might imagine I've had a very up and down career.
My income consists of annuity payments from investments I was lucky enough to acquire as a disability stop gap before I was diagnosed. But time and the stock market have lowered these payments a great deal from where they started. I still make a small amount of income from my CPA practice but it's difficult to grow a practice when health gets in the way. New clients want a healthy, strong CPA that they can depend on in case of trouble. When the IRS comes knocking, or more likely sends a registered letter, the client wants the CPA to jump right on the case -- not have to schedule it in around health issues.
It's also difficult to know how to charge a new client. Would a healthy CPA have taken this long to finish this task? Was I slower because it's difficult for me to concentrate and I'm tired? I don't want to over bill or do a poor job for a client who expects and deserves only my best.
So, last year I got the brilliant idea of giving a series of lectures to small business people about what to expect in the way of taxes. Of course, they could read books, but I found books too general. Books covered too many topics that had nothing to do with starting a small business in Tennessee.
Alas, the only one who thought this was a good idea was me. No one signed up to come to my seminars. Therefore last August I was faced with some very difficult decisions. Did I go out of business completely for a year, have no income, and then try for Social Security Disability? A pretty big risk. No guarantee I'd quality and after a year, my practice would certainly be dead. Even my most loyal clients would have found another CPA in that time and clients don't switch CPAs easily or quickly.
I had taken on little jobs here and there, my most exciting was stripping furniture at a local upholstery shop. I really loved that job. I could set my own hours, work 10 hours a week and make the extra income I needed. But when the summer came, I could not find a time when it was cool enough for me to get my work done. By the time fall and cooler temperatures came around I was eager to try my new seminar business and all my extra time and energy went into preparing for that. I wrote lectures and prepared handouts. I practiced my delivery and attended Toast Masters and rented a venue.
I learned a lot but nothing that would help me make money in the long run or the short run. More bills were coming due. My line of credit was almost maxed out. When all seemed lost, the local county library received the funding to hire two new part-time librarians and I applied for one of the jobs. I needed a job that had no stress, didn't require a long commute, and that I felt competent to do. I was very lucky to be hired.
So that's what I've been doing. I'm going to try and keep the blog updated more than once a year now that my finances are stabilized. Sorry to be away for so long
And I'm going to change or widen the blog topics. I'm still going to cover tax issues, and feel free to ask questions if you have any, but I'm also going to discuss how to live well on a limited income. I'm looking forward to it, I hope you are, too.
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