Salvatore Candela’s Tax Extension Breakdown

tax extensionIt’s the final full week of tax season, and our office in Queens is hopping!

But yes, I’m still taking the the time to step away for a moment and write to you, my friend. Lots of business to communicate today, with the deadline of Tuesday, April 17th, right around the corner.

And, fret not — if you have all your papers in, and are waiting for our completion, know that my team is hard at work, even as I put this together.

This is often our busiest week of the year (so please be understanding), but it’s also the week when we receive, with clockwork regularity, many questions from Queens taxpayers about extensions.

But before I get to those, here are a few more things that fall on the 17th…

1) Estimated taxes for the first quarter are due.

2) Want to open or contribute to an IRA or Roth IRA for 2017? Gotta get that done by Tuesday the 17th.

3) Final day to max out contributions for your 2017 HSA (Health Savings Account).

4) Claim any refund money from an unfiled 2014 return. (There is over $1BN of unclaimed refund money out there for that year — but only available if you didn’t file a return for that year.)

5) Most states’ tax deadlines also fall on the 17th. (Exceptions – DE 4/30; HI 4/20; IA 5/1; LA 5/15; VA 5/1; any state with no income tax.)

(Oh, and if you HAVE finished your process with us, please let us know what you thought. We really appreciate it. You can also find us on Yelp and/or Google Maps.)

Now … about those tax extensions.

Salvatore Candela’s Tax Extension Breakdown
“Here is a test to find whether your mission on earth is finished: If you’re alive, it isn’t.” -Richard Bach

As you know, this upcoming Tuesday, April 17, 2018, 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) this form: http://www.irs.gov/pub/irs-pdf/f4868.pdf with the IRS by the end of the day on the 17th. This gives you an automatic six-month extension of time to file (until October 15, 2018 — note, this is NOT the 17th of October).

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

So, when filing your “Extension of Time to File”, you’ll need to estimate what you think you owe to the IRS.  This should not be pulling numbers out of thin air (or other 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 tax extension.

And we can easily help you create this estimate.

You can do this all electronically through our office, you can mail in the form WITH estimated payment (must be postmarked by the 17th), or you can call a specialized provider and pay by credit card. We can provide you with the appropriate number to call.

If you cannot pay your taxes due for some reason:

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) Using existing credit sources (credit card, HELOC, private loans): some tax advisors would quickly recommend this, but I would NOT recommend you go this route, especially because the interest rates from the IRS are usually better than what you can get here.

However, if you’ve exhausted the options above, I suggest you do this instead:

7) Sell something you don’t need anymore. Always a pretty good plan anyway.

Warmly,

Salvatore Candela
(718) 894-1500

The TaxAdvocate Group, LLC

Filing Late On Taxes? You Might Actually Be Among Queens’s Smartest

Late On TaxesThere are less than two weeks remaining before the tax deadline of April 17th. 

Does that startle you?

If you’re filing late on taxes this year, let’s talk. We can easily file an extension on your behalf, and make sure  that your return is handled as advantageously as possible.

If you’re still a bit spooked by that deadline, well, it might be that you need to read what I’ve put together for you.

Yes, you might be feeling bad about yourself right now because you haven’t pulled together all your paperwork yet. You might even feel like you won’t be able to take advantage of as many deductions as a result (you’d be wrong — we can help with that).

In short, procrastinating difficult work (like getting your taxes ready) can induce a lot of guilt for Queens taxpayers.

Well, it’s time to break you free of that guilt.

Allow me…

(Oh, and if you HAVE finished your process with us, please let us know what you thought. We really appreciate it. You can also find us on Yelp and/or Google Maps!)

 

Filing Late On Taxes? You Might Actually Be Among Queens’s Smartest
“You can’t have everything… where would you put it?” -Steven Wright

Still haven’t filed your taxes yet?

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 in Queens.

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 people I know in Queens 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: shaving, doing your laundry, cleaning the house, writing thank-you notes–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 net more 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,

Salvatore Candela
(718) 894-1500

The TaxAdvocate Group, LLC

The Behavior Profile of Our Queens Clients with the Highest Level of Financial Security

Financial SecurityThe madness of March certainly delivered over the weekend, huh? Plenty of upsets and surprises, which always makes this time of year fun for basketball fans.

Or, so I hear.

After all, this tournament seems to happen yearly, and until the IRS changes the deadline for personal tax returns away from April 15th (the 17th this year), well … I can’t say that my staff and I are able to participate much.

We’re too busy doing your taxes, after all. And this time of year with less than one month remaining, we’re in crunch time. 

The corporate deadline is now behind us, and we are talking with Queens clients every day about their situation.

And these conversations vary — because not only do we consult with our Queens clients about their specific tax obligations, but we end up becoming a financial counselor as well. This, frankly, is a role that we embrace around here: for some, we are the only people who see the underbelly of their financial life … and who will still instill a dose of hope.

Because if I’ve learned one thing over the years, it’s that no financial situation lasts forever. I’ve seen too many clients crawl out from under six-figure (and higher!) debt obligations to ever again believe that anyone is ever financially doomed.

But in addition to instilling hope to our clients who are struggling, we also have come up with a pretty good profile, over the years, of what makes for financial security. We’ve seen some of our Queens clients work HARD to join the ranks of those who’ve achieved this, and it’s worth applauding.

Perhaps you’d be interested in what we have seen? Then read on…

The Behavior Profile of Our Queens Clients with the Highest Level of Financial Security
“A photograph is usually looked at, seldom looked into.” – Ansel Adams

If you pay attention to the news media, a few things become clear:

1) Chaos is coming
2) Chaos is already here

and

3) Did we mention anything about the chaos?

It’s true (and a very good reason to carefully monitor your media intake). So, becoming a household that will be able to ride through instability and uncertainty is a pretty essential component for life success.

Which is why I’d like to tell you about our Queens clients who have prepared themselves well. I’m not naming any names here, but I am interested in commonalities. And you’ll notice that these are just as significantly about your mindset as you relate to your finances, as about your behaviors.

Here’s what we have learned about our most financially-secure clients in Queens:

1) He always spends less than he earns. In fact, his mantra is that over the long run, you’re better off if you strive to be anonymously rich rather than deceptively poor.

2) She knows that patience is truth. The odds are you won’t become a millionaire overnight. If you’re like her, your security will be accumulated gradually, by diligently saving your money over multiple decades.

3) He pays off his credit cards in full every month. He’s smart enough to understand that if he can’t afford to pay cash for something, then he can’t afford it.

4) She realized early on that money does not buy happiness. If you’re looking for financial joy, you need to focus on attaining financial freedom.

5) He understands that money is like a toddler; it is incapable of managing itself.  After all, you can’t expect your money to grow and mature as it should without some form of credible money management.

6) She’s a big believer in paying yourself first. It’s an essential tenet of personal finance and a great way to build your savings and instill financial discipline.

7) She also knows that the few millionaires in Queens that reached that milestone without a plan got there only because of dumb luck.  It’s not enough to simply “declare” to the universe that you want to be financially free. This is not a “Secret”.

8) When it came time to set his savings goals, he wasn’t afraid to think big.  Financial success demands that you have a vision that is significantly larger than you can currently deliver upon.

9) He realizes that stuff happens, and that’s why you’re a fool if you don’t insure yourself against risk. Remember that the potential for bankruptcy is always just around the corner, and can be triggered from multiple sources: the death of the family’s key breadwinner, divorce, or disability that leads to a loss of work.

10) She understands that time is an ally of the young. She was fortunate (and smart) enough to begin saving in her twenties, so she could take maximum advantage of the power of compounding interest on her nest egg.

11) He’s not impressed that you drive an over-priced luxury car and live in a McMansion that’s two sizes too big for your family of four. Little about external “signals” of wealth actually matter to him.

And a little bonus, if you will: She doesn’t pay taxes which could have been avoided with a simple phone call to her Queens tax professional. She gets the advice, guidance, and expert assistance of a professional, and doesn’t waste her time trying to learn the tax code as well as those who have put in thousands of hours of their life to do so.

And here’s to you joining these ranks in future years.

Warmly,

Salvatore Candela
(718) 894-1500

The TaxAdvocate Group, LLC

Salvatore Candela’s 6 Negotiation Tips To Get What You Want

Negotiation TipsWell, the brackets are set — and the nation’s collective basketball madness has begun.

Billions fly around every year for this tournament (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.

But there is another, often-unnoticed, part of this season that always makes me shiver a little for Queens taxpayers: Unclaimed tax refunds.

Every year, the IRS tells the public about this phenomenon, and every year, I am mystified by those in Queens who miss out. This year, over one million taxpayers are missing out on a median average of $847 in unclaimed funds, simply because they didn’t file a tax return in 2014. There is over $1.1 billion (yes, with a B) sitting in a federal escrow account somewhere, and it might have your name on it. After April 17th (this year’s filing deadline), all of those funds get moved over to Treasury operating accounts.

We don’t want that, now do we? If you did not file a return in 2014, let’s see if you qualify.

Or maybe you DID file that year, but your friends in Queens could use our help?

It’s probably the case that if you miss that 4/17 deadline, you won’t be able to negotiate that unclaimed refund money back from the IRS.

But, that said, it’s my contention that many of my Queens clients don’t realize how much MORE they could negotiate themselves into more favorable positions with businesses, salespeople, family members (!) and other intersectors of their weekly lives.

So, allow this week’s Note to give you a little bump to consider negotiating for more than just a car price.

No, this really has nothing to do with your taxes (except as it relates to how a qualified professional might be able to negotiate on your behalf when it comes to tax debts). But as you may have gathered, we are in your corner for every part of your financial life, and otherwise.

Salvatore Candela’s 6 Negotiation Tips To Get What You Want
“Remember you will not always win. Some days, the most resourceful individual will taste defeat. But there is, in this case, always tomorrow – after you have done your best to achieve success today.” – Maxwell Maltz

No matter what career you’re in, or how far you go in it, the ability to effectively negotiate can make the difference between success and mediocrity.

Whether it’s a multimillion-dollar contract, a job offer, or a luncheon, here are some trenches-tested negotiation tips that will bring you closer to your ideal outcome:

1. Know what you want in advance. Don’t go to the table, or enter any kind of adversarial situation without a clear, realistic idea of what you want to achieve. It will help you negotiate with confidence.

2. Ask for what you want. Don’t be afraid to make the first offer. You’ll set the tone for the discussion, and studies (and my experience) suggest that the negotiator who goes first usually comes closer to getting what he or she wants.

3. Understand what your partner wants. A successful negotiation should satisfy both sides. Instead of trying to crush your competition, find out what he or she hopes to get, and try to work together toward a solution that works for you both.

4. Don’t concede unilaterally. Usually one side or the other has to give something up. If you do that, be sure to get a comparable concession from the other person. Giving away something for nothing will be taken as a weakness to be exploited.

5. Don’t rush. Time can be your friend if you’re willing to wait for the right deal. If the other side senses a deadline, he or she may be motivated to hold out until the last minute, or try to force you into accepting unreasonable terms. Be patient and let the time pressure work against your partner.

6. Be ready to walk away. This can take a certain amount of courage, but it’s necessary to avoid being backed into an agreement you don’t want. If possible, keep an ally in reserve–someone with the power to approve or reject the deal. This can give you an out if you need to turn down a deal, or motivate the other side to provide you with a better offer.

Now, these negotiation tips are really useful in most every situation. The *only* situation in which I might have you handle something very differently? In conversation with your spouse. 🙂 That’s a whole different article, but we’ll save that for another day.

Warmly,

Salvatore Candela
(718) 894-1500

The TaxAdvocate Group, LLC

2018 Tax Refunds Have You Confused? Salvatore Candela Provides Clarity

Tax RefundsWe are cranking along with tax return preparation here at The TaxAdvocate Group, and there are some interesting things that you should know about from Tax Land (that wild, scintillating world that it is).

Look — it is our J-O-B to handle this junk so you don’t have to, which is why I make it a point to not be too tax-heavy in my notes to you. But this week, well, there’s just a few too many things to ignore.

Firstly, did you know the government “shut down” for a few hours Friday night? It was a function of the Congresspeople finally coming to a budget deal, and, well … it might mean some changes for YOU and many in Queens (and it might not).

Buried in the deal were a variety of tax credits that HAD been expired for 2017 taxes, but which were suddenly reinstated. If you want to get very, very wonky, you can see the full list right here (beginning at Section 40101) — but here are some high points:

  • above-the-line deduction for qualified tuition and related expenses
  • mortgage insurance premiums treated as qualified residence interest
  • exclusion from gross income of discharge of qualified principal residence indebtedness
  • credit for nonbusiness energy property
  • credit for residential energy property
  • credit for new qualified fuel cell motor vehicles
  • credit for alternative fuel vehicle refueling property
  • credit for 2-wheeled plug-in electric vehicles

Basically, Queens students, homeowners, and energy-savers got their breaks restored. If this affects you, we can amend your return if you would like to account for these breaks.

However, my suggestion is that we wait a bit to see how the IRS responds, because they don’t actually have full clarity about what they will be doing about them just yet. Shocking, I know.

But I don’t blame them, because this is pretty last-minute, even by Congressional standards.

Finally, I’m going to use my Note this week to clear up some confusion about tax refunds that have been the subject of a bunch of questions from Queens clients this year. Here’s what’s really happening…

2018 Tax Refunds Have You Confused? Salvatore Candela Provides Clarity
“The truth can be funny but it’s not funny to cover up the truth.” -Ryan Cooper

Fake news is something we’re used to handling around here at The TaxAdvocate Group — you know the drill: “My neighbor’s uncle has a friend who is an accountant and HE said that my support parakeet is 100% deductible — and can even be counted twice!”

Yes, well … isn’t that precious.

Aside from those kinds of silly examples, there is some definite confusion about certain tax refunds this tax filing season, and we’re here to clear it up for you. Enough confusion, that the IRS issued a release about it (which you can read right here). I’ll deal with a few of those points, as well as a few other questions that we’ve received right here:

Confusion #1: Refund Delays
No, not every refund is delayed. Yes, EITC and ACTC related returns (both are child tax credits) WILL have delayed refunds. For every other kind of return in which a refund is expected, the IRS says that refunds should go out within 21 business days of filing. More about that below.

But about those EITC and ACTC refunds — unless you got some sort of advance on your refund, those might even take a little longer than was promised. The IRS said they will begin processing those on February 15th, but those refunds won’t begin to hit bank accounts until 2/27 — and that’s for those who chose direct deposit, and for whom there are no other issues.

So, hang tight.

Confusion #2: Checking On Refund Status
Have you heard that if you order a tax transcript it will tell you when to expect your refund?

Or if you call the IRS help hotline or ask US to call on your behalf that you’ll get a definite refund delivery date?

Whoops, more fake news. These social-media touted refund inquiry workarounds won’t work.

The information on a tax transcript does not necessarily reflect the amount or timing of a refund.

And as for calling us about it, we have no additional ways to check your refund status, unfortunately.

And sure, you can call the IRS directly … but be prepared to wait on hold for a looong time, and to receive no further information.

The BEST place to check, always is “Where’s My Refund” on the IRS website, which is right here: https://www.irs.gov/refunds

Confusion #3: “Is The IRS Calling Me???”
Short answer: No.

Longer answer: Nope.

Full answer: The IRS does NOT initiate contact with taxpayers by phone, email, text messages or social media to request your personal, tax or financial information.

If you are contacted in one of these ways regarding your refund — either a caller saying you owe more or an email promising a bigger refund — the communication isn’t from the IRS, even if the caller or emailer says they are agents. They are crooks looking to assume your tax identity and take your money.

Alright then. Glad we’ve cleared all of that up.

And in all seriousness: remember that we are in your corner. We’re here to help, and love to serve our Queens clients, so whatever advice you need, we’re just an email or phone call away.

To your family’s financial and emotional peace …

Warmly,

Salvatore Candela
(718) 894-5954

The TaxAdvocate Group

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