Posts Tagged ‘education’

CAMP ACCOUNTANT HAS ARRIVED!!!

Note: Camp Accountant is postponed for now. The original planned weekend is two weeks after FinCon and the same weekend as the tax extension due date. A large number of accountants wanted to attend, but couldn’t due to the due date. There were also several complaints the event wasn’t in Wisconsin. Colorado is an awesome place, but a lot of bloggers promote Colorado; it was felt I should promote Wisconsin. We can satisfy all these issues by having Camp Accountant in West Bend, Wisconsin at the Cedar Valley Center & Spa the week following the Novel-in-Progress Bookcamp, a program I’ve been involved with in the past. Sorry for the inconvenience.

 

The Event you have been waiting for your entire life had finally arrived! Camp Accountant is Here!

I don’t know about you, but I’m tingly all over. Camp Accountant is different from any camp you’ve attended in the FI community. All proceeds go to support the local Boys and Girls Club. In fact, all the registration money is collected by the Club. They pay for the cost of running the camp and put the rest to work serving the community. Everybody wins! Many of the venues are provided at low or no cost so more money ends up helping the Boys and Girls Club.

The first ever Camp Accountant is limited by the size of the venue so register early (details and links at the end of the post for registration and accommodations). First I need to share details. Read to the end for a special surprise!

Karen (she can share her full name if she wants) put this thing together. That means she did all the work. Please acknowledge her efforts. These things take time and cause stress so I am tremendously grateful for Karen’s efforts.

Karen and I have communicated during the planning process. She put together an information sheet so I’m going to cut and paste her words because she said it first and better:

 

Location – Salida Colorado — main location 419 D Street

 

Cost – $400 per person.

Participants – 30 people.

 

What this is all about –

 

Have a great time meeting like-minded folks, bike and hike around the Rocky Mountains in Colorado; learn cool stuff about accounting and how it supports our road to Financial Independence.

 

Keith from the Wealthy Accountant is hosting this event.

 

Lodging is not included in the event – it takes place in downtown Salida, Colorado.  Lots of camping and lodging nearby, all info provided upon registration. All lunches and most dinners are included in the cost of the ticket.

 

The camp will be a fundraiser for the Boys and Girls Club of Chaffee County. This amazing program supports youth in a rural county in Colorado.

 

A bonus of supporting the Club is that Colorado residents attending the camp will receive a donation letter for $200 that will equal a $100 credit on their Colorado state taxes.

 

Boys and Girls Club

 

Salida, Colorado is a very economically diverse community. As a small town of 5,000 people, there is no other after school programs for working parents that are affordable, and no other enrichment programs for families of limited means.

 

This program supports our local youth in many ways. Kids are with staff for homework help. They join structured programs to follow interests as diverse as sewing to robotics, and have a chance to be physically active instead of home alone in front of a screen.

 

The Club needs its own building to guarantee its future, instead of renting space and moving every few years. The opportunity to get word out about supporting the Club through the Wealthy Accountant blog could help us get a building so that the youth served by this program will have a permanent home.

 

Link to the Club website – http://www.bgcchaffee.org/

If you want to donate – http://www.bgcchaffee.org/Donate (click green button to donate online)





This is what the FI community is all about. We share ideas to improve our own lives and pay it forward so the upcoming generation can enjoy the same.

Here are answers Karen provided to important questions:

 

FAQ’s

 

Can I come just for the day?

 

The space will only hold so many comfortably, so we will only have tickets for the whole event.

 

Where should I stay?

 

There is camping, Airbnb lodging, and a couple of B&B’s all near the site. Details of lodging and transportation will be sent upon registration. Most locations for lodging downtown are within walking distance of under a mile.

 

Is registration refundable?

 

No, but we will try to find a way to transfer tickets to people on a waitlist.

 

Who is hosting this event?

 

Keith from the Wealthy Account Blog is hosting the event.

Snap Pea (Karen), a longtime reader of the blogs and OG of the FIRE world, is helping coordinate all the logistics, and is crazy excited for the fundraiser for her local charity.

 

For profit event?

 

No. Information on the club is linked above.

 

Could I or Should I bring my rugrats?

 

While there is a lot to do in the area, the setup isn’t good for kids running around if the weather is bad. They would have more fun with a non-attending person around. If you do want to have kids and/or partners join for meals, please email for availability and rates to cover food costs.





If you have any additional question use the contact button on this blog. I’ll do my best to calm Karen down, ah, work with Karen to get you an answer.

Here is the planned itinerary.

 

Tentative Event Schedule

 

Thursday, October 11

 

5 PM

 

Intro: evening at the Salida Hostel.  Beer, wine and appetizers (enough for dinner) provided.

 

Friday October 12

 

9 AM: meet at 419 D Street for a bicycle ride or hike around the Salida area. There are mountain bike trails, road bike routes along low traffic county roads, and hiking trails all nearby.

This activity is dependent on weather – coffee and conversation at the site is the alternate plan.

 

Noon: Lunch at HQ

 

Intro talk by Keith, Q and A’s, etc. (I promise not to upset stomachs.)

 

4 or 5 PM: beer at the site or nearby park, happy hour, dinner on own downtown Salida.

 

Saturday, October 13

 

8:30 AM: Yoga with a volunteer leader – for those so inclined.

 

9:30 am: Event – talks, Q and A, discussion topics, power presentations, breakout discussions

 

Noon: lunch at site

 

1 PM: Event – talks, Q and A, discussion topics, power presentations, breakout discussions

 

5 PM: happy hour and BBQ. Volunteers from Chaffee Boys and Girls Club will be helping with the BBQ.

 

Sunday, October 14

 

10 AM: coffee and conversation, possible 5 min power talks, hanging out.

 

Noon: sandwiches and leftovers for lunch, organized event ends.

 

1 PM: Mountain bike rides and trip to local Hot Springs for those inclined. Car-pool organized by participants.

 

Afterparty –

 

The after-party will continue in Salida, Colorado –

 

Stay longer and come check out our volunteer coordinator’s business – www.salidainnandhostel.com The Inn is set up as a friendly and social place to continue the fun after the Camp.

Salida is near several hot springs, hiking and biking trails and just a cool little town.





I’m happy to do all the talking, but for this to work best we need participation from others. Taxes are always a hot topic, especially with the new tax law in effect. I’ll answer questions personally as well.

We also need volunteers to give short presentations. Topics should be of interest to the FI community. Those active in real estate should consider a short presentation on the real estate market, RE values around the country and rent rates. Frugal living and early retirement are always of interest. And don’t be afraid to step forward and share some travel tips. Just because a certain unnamed accountant prefers to avoid travel doesn’t mean other wealthy accountants feel the same way. (For the record your leader is a slightly nuts!)

Here is additional important information before I provide the registration links:

 

Lodging–

 

We recommend staying in the downtown area. Salida Inn and Hostel www.thesalidahostel.com the Palace Hotel https://www.salidapalacehotel.com/ and the Simple Lodge https://www.simplelodge.com/  are all within walking distance.  We also recommend Airbnb as many locations are within walking distance.

 

Camping/RVs – There is a lot of free camping just outside city limits on public land. There is also a nice private campground just on the outside of town, as well as a public pay campground called Salida East.

 

Transportation to Event

 

There is one bus a day to Salida — it leaves in the afternoon from downtown Denver, to get there from the airport you take light rail. It works best if your flight arrives quite a while before the bus leaves.

http://expressarrow.com/

 

Renting a car is highly recommended unless your flights really work out for the bus.

 

The Colorado Springs and Gunnison airports are much closer — you would need to rent a car from them.

 

I come from a small town so I’m excited about our venue. The boondocks are my home and anytime my tail is planted in the outback I’m a happy camper.

This is going to be such an incredible event. Registration is on Eventbright.

 

Register Here!

 

Now for the surprise! I’m donating all my time and all my travel and lodging expenses are coming out of my pocket so the Club gets more of the proceeds. Airfare between the Accountant farmstead and Denver is really, really cheap; like $100 or $150 per person. Buuuut, Mrs. Accountant and I are driving so we can spend more time checking out the sights along the way. And since I’m driving there is a strong possibility a case (or ten) of the world famous Spotted Cow beer only available in Wisconsin will be smuggled in the truck of a wayward accountant willing to share.

I’d say the first beer is on me, but we all know it’ll be more than one.

See you at Camp, kind readers. There will be loads of powerful information for you and a future for the kids. And that is what life is all about.



The Best Speech Ever Given

Jordan Peterson is one of the greatest thinkers of our time.

When you think of the most powerful, motivating speeches ever given, Abraham Lincoln’s Gettysburg Address comes to mind. In less than three hundred words* Lincoln encompassed the issues facing the nation. As great as the speech was, it was backward looking (Four score and seven years ago) with hope to the future. Lincoln was able to clearly articulate his message in a few minutes. He struggled up to the moment of addressing the crowd as Gettysburg. It was the planning and preparation that lent to the quality of the message.

Closer to home we might consider the commencement address Steve Jobs gave at Stanford in 2005. At fifteen minutes, Jobs communicated a narrower message with significant reinforcement of his theme. Once again, serious planning took place prior to the presentation. Jobs was legendary in his drive toward excellence. He could speak before a crowd extemporaneously, but preferred formal presentations he could and did practice again and again until everything was choreographed to perfection. Errors were ironed out. He practiced so much that when he was live he could continue without missing a beat if technology failed while he was on stage. A Steve Jobs presentation was a show to behold.

Speeches that resonate come in many flavors. YouTube is filled with powerful speeches from movies and sports coaches. Speeches that cause a shiver to run down your spine include elements of life itself. “You can do it” is motivational, but when the words and emotions dig deeper we quickly realize the importance of what we are hearing.

Today I want to share a short speech (10 minutes from a longer interview) by Jordan Peterson. I’ve been reading and listening to his work for a while now. His recent rise to fame makes his plea more vital than ever.




A Typical Day at Harvard

The excerpt comes from a longer interview Peterson gave to a group at Harvard University. The video begins with Peterson asked what advice he would give students that want to make a difference in the world after they graduate. Peterson never missed a beat when he said, “Read great books!”

You can watch the video on your own and should several times to digest the entire message. What you should get on the first pass is that while Peterson was giving an interview, his responses are not completely extemporaneous. Over a long career he has developed a remarkable philosophy on how to live a good life. Does that sound familiar? It should. It’s been a while, but I’ve talked about Stoicism plenty enough in the past in this blog.

The overtones in this interview are dripping with stoic thought. Around halfway through the excerpt the interviewer even asks Peterson how to live a good life. What makes the responses so powerful is how Peterson opened the floodgate and released an articulate and passionate plea for listeners to accept how incredibly awesome our lives are today in the Western world.




A Game of Cards

Friday night is sheepshead (a card game with some (okay, few) similarities to bridge) night in the Accountant neighborhood. Since we are all a bunch of old duffers living in the backwoods of Nowhere, Wisconsin, the game starts at 7 and ends shortly after 9. (Did I mention us country folk prefer to hit the hay shortly after sundown?)

A few weeks ago one of our players, Pete, asked — as he always does — how our week was. I decided to return the favor and ask Pete how his week was. The rest of the night was shot. I don’t think we got more than three or four hands in before closing time.

My faith in the future is firmly intact. A recent sunset at the Accountant farmstead was a reminder and renewal of my faith in life, the future, the world around us and the beauty of life.

My polite interest in Pete’s prior week was all it took to open the gate and let it all out. Pete couldn’t stop talking about how awesome and great life was. Backwoods people live a frugal life due to environment. We can’t order pizza delivery. (There is no pizza delivery in our neck of the woods.) The closest shopping opportunity is 30 miles away and none of us miss the chance to be separated from our cash. (The card game is frequently brutal on the family budget. We play for dimes and a bad night could set a guy back a full dollar, dollar and a half. Like I said: brutal.)

Pete didn’t miss any of the highlights of our incredible modern world. We have internet (high speed!) here in the backwoods. Food is cheap and varied. The cost of living is cheaper than ever. We live longer and have medical technology to not only keep us alive, but to live better. A bum knee is a simple replacement today; in the past it was a permanent diminution to quality of life.

Debt is the only real problem messing up all the fun in our ultra-modern world, according to Pete and company. When things get tough (as if that is even possible today) you can reduce spending in all areas. You can cook more at home or turn down the heat/turn off the AC. You can walk or bike instead or burning gasoline. All budget items are easily reduced, expect debt payments. Those stay stubbornly locked in place regardless of events chipping away at family finances.

Pete retired fifteen or so years ago when he was about my age. He cut back even earlier, enjoying three day (or four) weekends. Now Pete is looking down the barrel of Social Security. Any day now he can pull the trigger and enjoy the influx of even more income. In Pete’s own words, he can’t spend what he already has! He has lived off an amount less than his Social Security check promises to be for years.




What Everyone Must Learn in College, But Rarely Does

Back to Jordan Peterson.

Peterson made it clear what college and a college education is all about. Most people think college is about learning a skill you can use to get a job. It’s not! College is where you must learn to think; a place where you must learn to articulate. That’s why he places such emphasis on reading good books.

Books have been a massive part of my life from an early age. I took a super early mini retirement in my young 20s to sit at home and read all day. There is no doubt the three or four years I bowed out of life to immerse myself in quality literature determined the success in all areas of my life.

My thirty year marriage has been the highlight of my life and still going strong. I learned from people who spent a lifetime together how to have that very thing. I read about raising good children, running a business, investing, personal finance, budgeting and taxes. I also took time to read novels with a powerful message.

So, if you go to college to learn how to articulate, think and speak, what are you to do with this superpower? “Stop unnecessary suffering,” according to Peterson.




Personal Mission

Money is only a tool. This is a personal finance blog firmly in the categories of tax, financial independence, early retirement and wealth building. But none of that is the underlying theme. I need to learn to articulate better, as Peterson suggests, to communicate this message. You don’t want money; you want to be useful!

The wisdom Peterson shares in a ten minute interview segment is a lifetime worth of knowledge. He shares another secret society is struggling with currently. He talks about how the 1% are not greedy bastards. He explains why you are not richer than you are. It’s because you are young! If you are a good steward of your money it will grow. Given time it will grow rather large. Your favorite accountant is a prime example. I’m currently on the top of the net worth list over at Rockstar Finance. I’m also a bit old to be telling people I’m considering early retirement. Give it another decade and I’ll be looking over the edge of late retirement (grow up, man!).  The truth is I had more time than folks in their 20s to accumulate my wealth. And as Peterson said, I’m not a greedy miser hoarding my money. I’m looking for new opportunities to reduce suffering in the world so to speak.

Life is so good today! When people whine and complain over how oppressed they are, I, like Peterson, am so disappointed. We can make a difference, but it will never happen complaining about everyone else!

The Accountant girls enjoying Frogg’s ice cream in Sherwood, Wisconsin.

My card-playing buddy, Pete, shares some traits with your favorite accountant. He doesn’t like to travel and has managed to live a life with far less traveling than yours truly has done. His wife likes to travel and does so with her friends. Pete happily drives his old truck (he recently bought a new one since the old one gave up the ghost) around the neighborhood playing with his solo rental property. He milked cows for a farmer just south of my farm for many years to pass time. If he gets bored and something pops up (it always does) he will do that for a while. Oh, and he stops at Frogg’s Ice Cream a lot in the summer.

If you get the chance to cure cancer, then do it! The suffering your will reduce in the world will be incredible! Most of us will make a smaller mark in the world. I’m here to tell you it’s okay to make a small difference. Just make a difference!  Daily incremental improvement compounds into massive results.

Pete provides shelter for a family and helps neighbors in need of fill-in help. He reduces suffering in his small way while living the life of his dreams. Maybe you prefer travel and grander endeavors. Awesome! We each need to play the role our personality allows.

I’m a lowly tax accountant. Yes, I reduce suffering by solving tax issues for businesses and individuals. I also contribute by sharing my experience and knowledge on this and other blogs.

Jordan Peterson makes it clear we need to learn to articulate because the world is in desperate need of people who can communicate a message, knowledge and information in an articulate way. I still have room to grow.

And good thing because I’m not ready to hang up my cleats yet.

 

* There are at least five versions of the Gettysburg Address, each with slight variations from the others, including word count. The Bliss copy is the most famous.



Wealth Building Resources

Personal Capital is an incredible tool to manage all your investments in one place. You can watch your net worth grow as you reach toward financial independence and beyond. Did I mention Personal Capital is free?

Medi-Share is a low cost way to manage health care costs. As health insurance premiums continue to sky rocket, there is an alternative preserving the wealth of families all over America. Here is my review of Medi-Share and additional resources to bring health care under control in your household.

PeerSteet is an alternative way to invest in the real estate market without the hassle of management. Investing in mortgages has never been easier. 7-12% historical APRs. Here is my review of PeerStreet.

QuickBooks is a daily part of life in my office. Managing a business requires accurate books without wasting time. Quickbooks is an excellent tool for managing your business, rental properties, side hustle and personal finances.

A cost segregation study can save $100,000 for income property owners. Here is my review of how cost segregations studies work and how to get one yourself.

Amazon is a good way to control costs by comparison shopping. The cost of a product includes travel to the store. When you start a shopping trip to Amazon here it also supports this blog. Thank you.

Taking the Lottery Out of Scholarship Applications

Today we have a special feature. My daughter provided today’s post as promised last week. It is hard to capture the work she did in preparation to winning all those scholarships and the pitch contest. She practiced in front of anyone who would sit still long enough for her to get it out. She honed her presentation until it was as smooth as silk. I even tried to interrupt and distract her as she practiced so she would be prepared for anything.

A few notes are in order. When Heather says the pitch conext was organized by a local bank, local business owners and the college, know I was not involved in any way with the program and had zero influence over the results. I listened to Heather practice, but did not attend the event. I didn’t want to be a distraction.

I want to point out Heather mentioned hard work. Sorry to say you can achieve great things as long as you are willing to do the work necessary to succeed. Another point I hope people don’t miss is Heather’s encouragement to never give up. If one thing doesn’t work, research and study more and reapply. The prize frequently goes to the consistent and persistent.



Taking the Lottery Out of Scholarship Applications

by: Heather Schroeder

 

I’ve never been comfortable with bragging. I wouldn’t go around telling people I got the best grade on a math test or that I got accepted into one of the best colleges in the United States. This is something I just can’t get myself to do. So, when my dad asked me to write a blog post about a recent success I had, I had to tell myself that it’s OK to be excited about winning something.

I struggled when I was in primary school. I was in a special reading class as I couldn’t read at the level I needed to be at and I was equally horrible at comprehension and writing. My reading disorder continued throughout my middle school career and I thought, based on my experiences, that I would never be able to read. Once I entered high school and wasn’t forced to read, I willingly picked up a book at my high school library. In less than a year, I had read more than twenty books and suddenly I knew how to write. This was the starting point that has led me to where I am today—an entrepreneur, a mentor, and a teacher.

I’m currently a student at Fox Valley Technical College in Appleton, Wisconsin. Fox Valley Technical College has a 94% employment rate, the highest in the area. This was the first year that the college had a pitch contest for FVTC students. A local bank, several entrepreneurs in the area, and FVTC staff all supported and funded the pitch contest.

Naturally, I felt a need to sign up, but even though I signed up, there was no guarantee that I would be picked to be one of the eight finalists. Three months after I signed up, I got the email stating I was accepted as one of the finalists. I was rejoicing, and I felt like I was on top of the world. There was only one problem, though—I had a lot of work to do because my business was not what the judges were looking for. And if I wanted to win the grand prize, I needed to switch from being a solopreneur to an entrepreneur.

Think about it. I started a tutoring business with the intention of being the only employee and taking on as many clients as humanly possible. This worked great and was a nice way to have some extra cash coming in on the side; yet, I wasn’t making enough to survive. This is one of the reasons I decided to go back to college. I knew I needed an education, no matter how little or how much, to be taken seriously as an academic tutor.




I had one month to come up with a 90-second pitch for the Fox Trap Pitch Contest in hopes of winning the grand prize. First through third place were guaranteed a financial award. This is something I was bound and determined to win.

My adrenaline was pumping as I entered the room full of judges and FVTC staff. My entrepreneurship teacher was also running the show. I had to make him proud as my entrepreneurship teacher is the reason I’ve come so far. My pitch went great and the judges seemed interested in my teaching style I created and the opportunities for people in the valley and around the world to become employed by me. I’m an ambitious little thing that doesn’t let my size determine how big my dreams can be.

I won first place at the Fox Trap Pitch Contest. This was one of the first times I’ve seen myself succeed at something and then be told that I need to continue with my plan. I learned many things when I prepared and presented my 90-second pitch. The most important thing I learned was that writing a pitch is nearly identical in writing an essay for a scholarship.

When preparing my pitch for the contest, I had to identify a problem, identify the target market, identify the solution or solutions, and determine how my idea will make money. I also had to identify what I was going to do with the winnings. This outline is exactly how many scholarship essays should be written.

All scholarships follow the same general rules including determining the winners by how creative the applicant is, how well written the essay is, the quality of the information, and determining if the applicant is a right fit for the scholarship. When writing an essay for a scholarship, follow these simple rules.

  1. Identify the problem or identify the topic

When writing essays, research reports, and personal memoirs, the stories or the introduction introduces the audience to the situation. Research reports are the easiest when determining and solving a problem. With my pitch, I determined the problem by stating startling statistics and examples of why it’s important to help “at risk” students and students in special education succeed.

 

  1. Identify the target market or who you are trying to reach

Scholarship essays usually want applicants to write about issues that are affecting others in the United States. One scholarship I run across yearly is the drinking and driving scholarship that requires applicants to write about and videotape themselves on describing how they think they can help make people aware of the risks that come with drinking and driving. With my pitch, I determined my target market by identifying who I wanted to help. My target market is “at risk” students and students in special education. The target market for the drinking and driving essay could be people who drink often and take the risk of driving or college students. According to the college drinking prevention website, “1,825 college students between the ages of 18 and 24 die from alcohol-related unintentional injuries, including motor-vehicle crashes.”



  1. Identify the solution or what you think could be done in the future

When writing a scholarship essay, determine what you think could be done to solve the problem. My solution for my pitch was offering academic tutoring services for “at risk” students and students in special education and teaching these students by utilizing my teaching style, which has so far been a success.

 

  1. Identify what you will do with the winnings

Like with the pitch contest and writing scholarship essays, judges want to know what you will do with the winnings. I determined in my pitch that if I won I would use the winnings to go to China to determine if my business idea can work globally. With scholarships, determine how you will use the winnings. I usually state that I would use the winnings for housing, tuition, food, and supplies.

The last piece of information I can give is to research how to write scholarships outside of reading this blog post. I have given some valuable information, but there is so much more available online. I suggest looking on YouTube and searching for videos on pitch contests. These contests have great insight on how to reach your audience and make a difference in lives of others.

I wish you the best of luck.

May the odds be ever in your favor.

Endnote: Once again I encourage you to reach for your dreams. Heather is 23 years old and living her dreams. She is on her way to China for a month to teach in a few weeks. More opportunities are coming her way as a result. I don’t like to travel; she does. I never asked my kids to live the life I expected of them. I always encouraged they walk their own road. There will be bumps and even painful experiences. It’s part of life. But the journey is all worth it.



Wealth Building Resources

Personal Capital is an incredible tool to manage all your investments in one place. You can watch your net worth grow as you reach toward financial independence and beyond. Did I mention Personal Capital is free?

Medi-Share is a low cost way to manage health care costs. As health insurance premiums continue to skyrocket, there is an alternative preserving the wealth of families all over America. Here is my review of Medi-Share and additional resources to bring health care under control in your household.

PeerSteet is an alternative way to invest in the real estate market without the hassle of management. Investing in mortgages has never been easier. 7-12% historical APRs. Here is my review of PeerStreet.

QuickBooks is a daily part of life in my office. Managing a business requires accurate books without wasting time. Quickbooks is an excellent tool for managing your business, rental properties, side hustle and personal finances.

A cost segregation study can save $100,000 for income property owners. Here is my review of how cost segregations studies work and how to get one yourself.

Amazon good way to control costs and comparison shop. The cost of a product includes travel to the store. When you start a shopping trip to Amazon here it also supports this blog. Thank you.

 

A Free College Education Made Easy

It is possible to get a college education without loads of debt. Learning scholarship application tricks that work is a key ingredient.

The last time it snowed more in NE Wisconsin was March of 1888. That’s a long time ago.

My oldest daughter, Heather, was home from college when the storm hit. It was so bad they closed the college so she stayed with us an extra day. Our family bonding time consisted of shoveling wet, heavy snow a good part of the day. Such is the way of things in the Northwoods.

April snowstorms melt fast. The days are long and the sun is high in the sky. Cold temperatures fight a losing battle.

But when record snow falls it takes time to clean the roads and melt the piles. We should have the last of the piles melted by May 1st.

Heather’s car had to stay outside because the garage is full. With modest coaxing I got the AGCO tractor started and started moving most of the snow out of the way. Heather’s car was the last thing we dug out.

The next day the roads were plowed and it was time to head back to college. On the way back her car died for no apparent reason. The car was towed to a shop south of Neenah for repairs. The bill came to nearly $500, a princely sum for a college student.

As bad as Heather’s luck was, it could have been a lot worse. She saved and invested for several years before committing to college full-time. Still, she is determined to finish college without a penny of debt. (So far, so good.)

But that isn’t the reason why car problems were nothing more than a hiccup along her college journey. And her story can help countless others attain a college degree without cost.




Slow Start

Heather had grand ideas when she reached adulthood. She wanted to attend Full Sail University in Florida on dad’s dime for an art degree. I’ll save you the damage to your eardrums and refrain from my response.

At the time Heather was selling artwork and stashing it away into investments. She is quite good at a variety of art forms. What she struggled with was scholarships and dad wasn’t in the cooperating mood.

Then she got the idea she would go to college (art again) in Thailand. She got her passport (more on that later) and sent the school $500. The short story is she never went to Thailand. She did get one heck of an education for the lost $500 and the cost of a passport. Truth is she wasn’t ready to be alone in a foreign country. Yet.

Then she looked into a school in Missouri that was affordable, but it wasn’t what she wanted. Then she toyed with Japan and more seriously with South Korea. The only place she didn’t want to go to school was some of our affordable options right here in Wisconsin.




Seeing the Light

Dad made it clear he wasn’t paying for any college costs unless Heather found some scholarship money. It wasn’t that Heather didn’t try. She applied to a hundred or more scholarships without a nibble.

The first turning point came when Heather decided the local technical college was an okay place to start her formal education. She busted her tail working to fund her education so dad relented and provided a modest—around $2,500—of financial support. When my kid puts in the effort I’ll do my best to help them.

Choosing a local college and a career she could reasonably expect to earn enough at to calculate a return on her education investment gave dad hope. Heather likes to travel the way I like to nest on the farm. Heather wants to see Asia. She is in love with the cultures and peoples. The only thing missing was some scholarship money to grease the process.

Now that she was going to college close to home she was able to get some small grants and scholarships. Most of it was state or local government provided. Wisconsin chipped in $300 and the Department of Vocational Rehabilitation (DVR) invested around $1,000. (DVR provided support because she has her own tutoring business and she has some medical issues.)

Proud parents posing with their daughter.

Still, scholarship successes were scarce. I read a book by Ramit Sethi (I Will Teach You to be Rich) years before where the author claimed he had so much scholarship money when he attended college he was able to save and invest some of the funds since they weren’t all needed for college expenses. I was concerned Heather was unable to apply the same procedures to her college funding.

Sethi was slamming one scholarship after another while Heather couldn’t get them to open the envelope. Something was wrong. When something isn’t working it doesn’t mean you double your efforts doing the same thing. You just go nowhere twice as fast!

Dad had no solutions. College was a different animal back in the early 1980s. I had my own home (didn’t live on campus) and paid my own way. Scholarships weren’t necessary because $1,000 would cover a semester easily, including books, with a meaningful remainder left over for social activities.

Heather is like her dad: knuckle-headed. She wanted to go to college so bad it hurt and she wasn’t going to be denied. Mom and dad are supportive, but we will not give a free ride. Eighty percent of a college education is getting there. If you want to make it in the business world you better be able to figure out how to get an education without visiting bankruptcy court.

Money was tight her first year. She wanted college to be self funding; no dipping into long-term savings either. She studied hard and has a 4.0. And she never stopped researching scholarships and other college funding opportunities. She also clung to her dream of teaching English as a second language in China.

As Heather approached the first year as a full-time student (she was taking a class or two prior) opportunities she never knew existed were exposed to her. Since she has a tutoring business several organizations were interested in helping her. Her college started a Fox Trap Pitch Contest. (We live in an area called the Fox River Valley and the Fox Cities.)

Heather tackled this contest the way she did everything in school, with unrelenting effort. First prize was $1,000. Want to guess who won first place. Yup! My daughter! All I can say is, “Good genetics. Especially from the paternal side.”

The pitch contest did more than help her promote her business and raise capital. It taught her how to pitch an idea, like maybe to a scholarship. And this is where it gets interesting. In the last few months she finally figured out how to pitch her business and submit to scholarships in a way that works.




Unlimited Opportunities

You can’t imagine how proud I am of my oldest daughter. She never quit no matter how down she got or depressing it was to work without results. (My youngest shares the same attributes so I’m proud of her, too.)

The best part is she knows how to do it herself. If dad wrote a check Heather would still be clueless on a good many things. I would have robbed her of the most valuable part of her education!

Remember how I said Heather wants to go to China to teach English as a second language? Well, her degree is for teaching. She is also leaving in a few weeks for China to teach for a month. She has been contacted for job interviews when she gets there. When her month is done it is back to Wisconsin to finish another school year. She will probably tutor via internet during the school year and head back to China for a much longer stay after she graduates. Her passport was a worthwhile expense after all. BTW, China instantly gave her a 10 year work visa.

China and the United States are two very different cultures. But as Warren Buffett has said all along, the United States has the “secret sauce”. In the last week he added China to the list saying China also found the “secret sauce” economically. With two great nations and cultures, with a heaping bowl of sauce bridged by my daughter and her efforts, the human race is destined for glory never seen before. (Yes, dad’s pride is swelling.)




Grabbing the Chance

Things were different when I went to school. Higher education is expensive today. Student loans are out of control. School counselors want to help students manage loans. Heather was quick to interrupt when the topic came up to explain she wasn’t interested in loan. God, that kid is smart. Mom had to have done something right because I’m not that gifted.

Scholarships are everywhere. Large numbers of scholarships go unawarded due to lack of interest or quality entries.

Heather was recently elected vice president of the Wisconsin region of Phi Theta Kappa. She gets to do more of that traveling she loves now and is guaranteed another scholarship. This one could be meaningful, if you know what I mean.

As a side note, Heather tried to convince me Phi Theta Kappa means “the smart ones” in Greek. Dad was suspicious and looked it up. Good one, Heather. And yes, I know you’ll be reading this. BTW, it means “wisdom, aspiration, purity.”




A Scholarship for Every Wealthy Accountant Reader

Some things I can’t do no matter how important they are. I’m not in the trenches when it comes to college funding.

Heather is getting an education on how to get an education. Therefore, I asked her to write a follow-up article to this post which she promised me in a week. If all goes according to plan I will publish Heather’s post next week on how she discovered how to write killer scholarship applications that work.

I think she will also include other resources she has used. For example, her college has a service called SALT. The SALT program has a massive clearinghouse of scholarships where the college helps you submit a quality application. And it’s FREE! Just be careful when they try to help you with getting student loans. Student loans are the last line of defense when all other options are exhausted. When you stand firm expecting scholarships to pay for your education, the counselors have to up their game to help you. Make it clear you want scholarships, not debt!

My opinion on college has been published before. Education is the most important thing you can do to improve your life. Most education happens outside the classroom! That doesn’t take anything away from a formal education. College is about learning and making contacts.

Next week, if all goes well, you will make a powerful contact with Heather.

Finally, remember Heather’s $500 car repair bill? She discovered there is a program at the college where they will help pay one major expense per year, in Heather case, up to $500. She kept her eyes open for opportunities removing a car repair bill from the budget.

Smart, girl, don’t you think?



Wealth Building Resources

Personal Capital is an incredible tool to manage all your investments in one place. You can watch your net worth grow as you reach toward financial independence and beyond. Did I mention Personal Capital is free?

Medi-Share is a low cost way to manage health care costs. As health insurance premiums continue to skyrocket, there is an alternative preserving the wealth of families all over America. Here is my review of Medi-Share and additional resources to bring health care under control in your household.

PeerSteet is an alternative way to invest in the real estate market without the hassle of management. Investing in mortgages has never been easier. 7-12% historical APRs. Here is my review of PeerStreet.

QuickBooks is a daily part of life in my office. Managing a business requires accurate books without wasting time. Quickbooks is an excellent tool for managing your business, rental properties, side hustle and personal finances.

A cost segregation study can save $100,000 for income property owners. Here is my review of how cost segregations studies work and how to get one yourself.

Amazon good way to control costs and comparison shop. The cost of a product includes travel to the store. When you start a shopping trip to Amazon here it also supports this blog. Thank you.

How to Write Engaging Blog Posts

Grab the reader’s attention early. A rubber snake might do the trick. Then again, maybe not.

Every writing conference I’ve ever been to has a breakout session titled: PANTSER OR PLOTTER?

Beginning writers flock to these things because they think it’s an important part of the writing process when the question is really a matter of personal work habits.

Many successful writers plant their tail in front of the keyboard and start pounding out copy while others need a detailed plan before the muse flickers to life. Plotters take the risk they’ll plan until infinity before rolling up their sleeves and working; writing from the seat of your pants can lead to rambling pros in need of heavy editing.

The longer the work the more need for at least a few details before you start. Novels need a plan (which usually changes several times before reaching the conclusion) while a short story can start as a vague concept and move to the page rather quickly.

Blogger’s Dilemma

Bloggers are desperate to get something published. Once upon a time you had to write until your fingers bled to improve your voice and acuity on the page. The only true way to master the writing craft is to write. A lot!

Traditional publishers want polished work. Polish comes from experience. Experience comes from practice. It takes heart to write endlessly perfecting your craft without much reinforcement.

The publishing world has changed tremendously over the last several decades. Self-published books were universally bad in the past. Today many of the best books on the market either are self-published or started as a self-pub.

Bloggers are like any other writer. They want to see their stuff out there as soon as possible. Rushed work looks, well, rushed.

I’ve received several requests to discuss my writing habits. Most people realize publishing a half million words a year on a personal finance blog is a lot of work. They want to know where I get my ideas, do I plot or write by the seat of my pants, when do I write and how fast do I write.

I imagine the Plutus Award for Best New Personal Finance Blog of the Year has something to do with it. Another part is my story telling. People expect boring facts when they see “Accountant” in the title. Surprising the reader with engaging storytelling mixed with useful information grabs them early and keeps them.

Some questions are hard to answer. One reader asked how I come up with such awesome post titles. I didn’t have an answer.

Writers have a difficult time explaining what makes a good piece of writing a good piece of writing. At first glance it appears I just sit down and peck out a story, hit publish and people get Ooooo lips.

Rather than give you stale, dry description on how to write an engaging blog post people will want to read and will keep coming back for more, I will show you how I do it. My way isn’t right for everyone, but it does give you an idea on how my creative process works.




How I Write

Ideas hit me all the time. Reading a book, watching a movie, talking with friends, thing jump out at me and demand recording. The working title of this post was the title of this section. Of course, if I want anyone outside my regular readers to become “engaged” in this post I had better come up with a better title.

When ideas hit I take notes. At home, at the office, on the road, I keep paper and pencil handy. Yes, even beside the bed is paper and pencil. I sleep on the couch about half the time and in bed the other half. On the couch I’m surrounded by books and papers. When my creativity is highest I wrap myself in the literature and recording utensils.

Rarely do I sit and write spontaneously. After a long day, writing a quality post requires some advance planning. If I had no previous ideas to mull you wouldn’t see a new post the next day.

There are 64 unwritten posts in my WordPress queue. You need a title to save the idea, but every title is accompanied with a few sentences outlining a theme I wish to address. Sometimes the notes are detailed and run several hundred words and links to resources. Most descriptions are short. This post has two sentences as the material for pumping my creative energy.

Most ideas die in my little notebooks. After thinking about them for a few days it becomes clear the idea doesn’t work or the project would be 20,000 words. (As an example: I had planned a post on climate change and why it doesn’t matter, plus how it affects personal finances. The material I gathered kept growing until I realized it would be a veeeeery long post. It would also cause people to throw things at me since it’s such a politicized topic. I had planned a second post on mass extinctions and why we are not in the sixth great extinction. The natural world is becoming more diverse even as people think humans are killing everything off. The work on both these posts would have ended up short books in their briefest form so I shelved the projects. I did get to read several really good books on the subject so all wasn’t lost.)

(Good blog posts also try to avoid long paragraphs.)

Three times a week I publish on a topic of interest in the personal finance community (I hope). On Saturday I give readers a glimpse inside my personal life.

Every day I am thinking about writing! When I take a break or eat I’m thinking about what I’ll write in an upcoming post. The thoughts are never more than a few inches away.

By the time I punch the first words onto the digital screen I’ve played the idea through my mind countless times. I start the story and then toss it when it goes down a dead end road. As I work around the farm or workout at the gym I’m playing with possible scenarios.




The Fun Part

Most days I have a good idea which posts I’ll be writing for at least a week out, including the “Stalking the Accountant” post on Saturday.

This gives me time to work the idea out in my head. Plotting is something I rarely do even when writing a long novel. (Eight years ago I wrote a 180,000 word science fiction novel from a three sentence note. I knew where I wanted to go and started building the story. It ended up someplace different and a better story that is now the first book of a trilogy.)

Pantser writing has a huge risk. Plotting is drudge work. I like to write. After plenty of time thinking the idea through (sometimes with and sometimes without notes) I set to work. Writing from the seat of my pants means there are times I write a post and get the dry heaves when reviewing. Yes, I have to start all over. The idea I regurgitated is dead and gone once that happens. Those are tough days when I have self-imposed deadlines.

Most of the deleting these days happens in the editing process. Maybe a dozen or so posts get completely rejected per year. Most can be salvaged with work. On good days (when the whisky is flowing freely) the necessary editing is light. Those days are rare.

What comes next is the part people seem most interested in. They want to know “how” I write.

Most posts, including this one, are written the night before they are published. The clock reads 10:05 as I type these words.

On a good night I can stamp 1,000 words of rough draft to the laptop’s memory banks per hour. On a bad night I start to wonder if I’ll get any sleep before sunrise.

Normally, rough draft takes two hour or so for posts on this blog. If more research is needed or if I want to add more links for readers to dig deeper into certain points I don’t have space to adequately cover in the post the time commitment increases.

It seems easy at this point. Some crazy guy from Nowhere, Wisconsin types for a couple hours and calls it a day. If only it were so easy.

Dozens of hours of thought entered the scene before the first word was typed. Sometimes I read entire books or pull information from several books to build a quality post. I don’t show books just to get an Amazon sale! These books really add to the learning process of the reader!

Writing rough draft appeals to beginning writers. I don’t know why. From the outside it must seem like that is all a writer does.

The hard work reignites the next morning. Editing also takes several hours as I rework the words until they communicate what I demand them to. Time constraints can be an issue.

I read every post out loud to Mrs. Accountant. Reading aloud is the most powerful editing tool I know of. If Mrs. Accountant will not sit still to listen to you read your work to her you can still read aloud to yourself. Trust me, it works.

Important note: Stephen King in his book On Writing tells a story of an editor who once sent him a note along with rejection letter stating: Final draft is rough draft minus 10%.

I don’t delete as much as I used to. As you build your writing skills you will delete less, yet still edit plenty. Sometimes you even add during the editing process. Remember the 180,000 word novel I mentioned above? In the editing process I highlighted 30 pages that needed to go and hit delete. I loved the story deleted, but it had no place in the novel. If you want engaging writing you have to do it.

Publishing a blog is more than words. I was never a picture taker. Now I’m always looking for possible images to add to posts. At least phones have cameras today and Google automatically downloads the things to “Photos” on my laptop. Don’t ask me how.

Formatting the post takes about an hour.

As soon as I finish I hit publish. Sometimes I finish a day or so early. In those instances I schedule the post. Most scheduled posts are written the day before versus the night before. This means Mrs. Accountant listens to the story at night. Before I hit the hay I format and schedule the post.




Personal Touch

The information to this point is mechanical information. It tells you what you’ll see if you follow me around and read my mind. You see me mentally taking notes and planning. You see me writing and editing. My personal writing schedule will not produce engaging posts!

Engaging writing has a piece of you in it. Stories are vital! Most posts on The Wealthy Accountant have some element of story. A good writer knows which parts of the story to leave out. The same story can be told multiple times from different perspectives!

Your life is rich and full of stories. Your childhood, work, marriage, health and family are a cornucopia of stories to share.

Our wedding candle as we approach our 30th wedding anniversary. The personal touch is the key ingredient of engaging writing. Always have a piece of you in there.

No matter the subject, stories are important. Without a personal story the information is just rote formality. For crying out loud, kind readers, I write on taxes and personal finance! Story is the only thing I have to offer unless you think plagiarizing the stock quotes page of The Wall Street Journal is engaging material.

Stories from history or the news are interesting, but often told. Your story, told right, is one only you can tell and readers will find it near impossible to put down or stay away.

Stories are unique in communicating information. Story allows a message above the communicated information. Think of the power of Christ’s parables. They stood the test of time and are so memorable for a reason regardless your faith.

When you own the story the reader gets a chance to step into your world. That’s why a started publishing the “Stalking” posts every Saturday. Engaged readers want to know more about the person they are growing fond of!

Share a piece of you and readers will be engaged. Readers feel like they know you and in a way they do. Writing allows the author to share at a deeper, more intimate level than mere verbal communication.

Practice, kind readers. If you are looking to write an engaging blog you MUST practice. Practice is the only way to get good. Write every day. Never believe you must publish every word you smear across the parchment. The words aren’t that precious until you can string them together in a way that makes your readers swallow hard. They just can’t seem to get the lump in their throat to go down.

The clock now read 10:37. This post is coming to an end. I’ll read a bit before retiring for the night.

Tomorrow morning the hard work starts. If I do it right (or is it write) you’ll be thinking about these words for a lifetime.



When Claiming Fake Deductions is Legal

Google has a neat feature called Alerts. This feature allows you to get a daily update on any topic you desire. The setup process is so simple even an accountant like me can do it without a problem. Once set up Google scans the internet, news and social media for mentions of your selected topic/s.

I follow a few topics which rarely get an update. I also have an alert of my tax practice: Tax Prep & Accounting Services, Inc.

The name of my practice is generic for a reason. I wanted something simple like General Mills or General Electric or General Motors. While most accounting firms want to spray paint their names across the logo, I wanted a name a buyer would feel comfortable purchasing without changing the name. You see, I was thinking about my exit before I even opened the doors.

Thirty years later I’m still holding on without a sell date in sight. I also get a daily Google Alert on a dozen or so items Google thinks fits my criteria of interest relating to my business name.

Accounting Today is an industry newspaper with a Tax Fraud Blotter. It usually tops the list provided by Google when an alert is issued.

On an alert received Saturday was the clickbait title: Look Ma—Phony Deductions!

The title bothered me because phony deductions, or more to the point, unsubstantiated deductions, are not always illegal!

I clicked to the Tax Fraud Blotter and discovered, as I knew I would, there was more to the story than the headline. The phony deductions were illegal. But the topic of legally claiming unsubstantiated deductions is real.




A Story from the Underground

If you were a tax professional, what would you do in a case like this? A regular client starts a business and has questionable recordkeeping from Day 1. Then he expands his business and has almost no records at all.

There are only a few things you can do. First, you can fire the client.

Remember, as a tax professional you sign the tax return under oath that the return is “true and accurate to the best of your knowledge” under penalty of perjury. If you sign a tax return as the paid preparer and the return doesn’t pass the sniff test you can face some serious fines, some as high as $25,000 a swing!

Second, you can throw up your hands and tell your client, “You can’t file an inaccurate return so I guess you don’t have to file at all.”

This is another really bad idea.

Third, you can prepare the return with the information at hand and hope for the best.

Each of these choices has issues. Firing a client because they’re stupid they didn’t keep accurate records doesn’t solve the problem.

It’s illegal NOT TO FILE your tax return by the due date, plus extensions. You are required to file even if you can’t pay. Lack of funds is not illegal; non-filing is!

If you refuse to touch the return somebody else will have to or the client is out in the cold. So if you don’t do it, somebody will or your client is heading for the hoosegow.

Telling a client they don’t have to file their tax return if they didn’t keep pertinent documents is also a bad idea.  I don’t know the IRS penalty off the top of my head, but it includes a baseball bat and something about “behind the woodshed.”

And last, hoping for the best is not sound tax advice.




Super Accountant to the Rescue

If you’re a taxpayer reading this you might want to put your fingers in your ears for a few sentences.

There is an easy way to file the above mentioned tax return for a disordered client and you get to charge extra for the service. A lot extra!

Last summer I wrote about the Cohan Rule. Now with tax season racing straight for us at warp speed, it’s a good time to review an extreme case which will allow you to file an accurate return “to the best of your knowledge” and avoid preparer penalties.

The example client we used above for our thought experiment is a real client. He runs a liquor store. His records are a mess to be polite. When we ask for more documentation we get an annoyed, “We gave you everything. It’s in there.”

No it’s not!

Last tax season it was so bad I had to junk the entire return except for three things: the bank statements showing deposits and checks written, supplier printouts for cost of goods sold and property taxes paid by going to the county to get proof of what was paid and when. From these few items I had to reconstruct a tax return, avoid preparer penalties and stay out of jail.

What would you do in a case like this? The client is a good guy, just a bit light when it comes to recording business income and expenses. Dumping him on the street would almost certainly end in the return never getting filed for years until the IRS lowered the boom. Then it would hurt him really bad and certainly end his business, putting him and his employees on the unemployment line.

You already have a good idea what I’m going to do. I’m going to make up numbers. But how?

You can read the Cohan Rule post I wrote back in August. The Reader’s Digest version states you can deduct reasonable expenses ordinary and necessary to a business (Section 162(a)) with the exception of meals, entertainment, recreation, amusement, gifts and certain listed property (Section 274(d)) for unsubstantiated expenses.

In the case of our friendly client, we also had to reconstruct income!




Building an Elegant Tax Return

I will show you how I built this client’s tax return without triggering an audit. The odds of the client getting audited are slim as I told the IRS exactly what I did. Past experience leads me to this conclusion because I’ve never had a client audited when I disclosed what I am about to show you.

Our victim, ahem, client had a box of stuff to go through. I added the whole thing up once his retainer cleared the bank.

The numbers were well outside the expected norm. (Remember, a tax professional can’t just file a return based on client provided information. If the numbers are unusual the tax professional MUST quiz the client further to ascertain if the data is correct. Unusual items remaining on a tax return should be disclosed with the original return. The disclosure should include the item in question and how the number claimed was arrived at.)

I pay special attention to local clients. If they have a business I make a note when driving past their establishment if I’m in the area. Clients miss a lot of serious tax benefits I find from a simple drive-by.

Our client in question had a small shop. I expected that since it was a liquor store. The footprint of such establishments is generally small compared to sales.

I also had his prior year return to build from. The numbers were substantially different.

I plugged the numbers I had as a starting point. My software compares the current year to the prior year. It was a crazy mess.

To construct a return I’d be willing to sign off on I started with known variables. The client was slow to get me bank statements so I had him sign a power of attorney allowing me to pull his bank records.

With the whole year of bank transactions in hand I added all the deposits for the year to arrive at Gross Revenue. I asked the client if he had ever deposited personal cash or checks to fund company expenses. He said, “No, well, maybe once. Okay, but, yes. No! Now that I think of it, maybe.”

There is a price for bad records. It’s called double taxation. If you can’t prove any of those deposits aren’t business income you have to report it as income! My disclosure to the IRS will list my position as such for good reason. The IRS uses the same formula!

I also asked if any income wasn’t deposited. I got an answer identical to the last question. Facepalm.

The revenue looked reasonable compared to the growth in his company.

Next I used the power of attorney to get a printout of the cost of goods sold from his main supplier. This was another number I could hang my hat on with reasonable comfort.

The COGS allowed me to back out an expected revenue number. It was close so we will stick to what we originally calculated by adding all deposits.

Property tax records are easy to find online so that was one expense I was also comfortable with.

Now came the hard part. I had three months of rent receipts and the landlord wasn’t kicking him out so I multiplied one payment by twelve.

I asked the client if he ever took money from the business account for something other than a business expense. By the way his mouth was catching flies I took it as a “no”. I couldn’t add all the checks cleared and allocate between expenses. (Since some items are not allowed under the Cohan Rule I don’t use the bank statement for a total of deductible expenses when I have no substantiation unless I have no choice. That and I know how small business owners like to take cash here and there for personal expenses even if they say they don’t.)




Deep Science

Now we are going to get extremely scientific; we’re going to guess.

Advertising, utilities, office supplies, and other expenses still are allowed under the Cohan Rule.

For our client today I took his information from prior returns and compared the expenses as a percentage of revenue and COGS. Example: If in the past three years he has advertizing expenses of 12% of revenue and 27% of COGS, I will use the percentage that gives the lower number as a deduction.

I want two reference points whenever possible. I use the lower deduction because it’s not my job to put my neck on the line if you don’t care enough to keep good records.

I move to each deduction normal for the type of business involved.

As I work through the return I keep detailed records of how I arrived at the numbers I report and attach it to the tax return and keep a copy in our permanent file.

I’ve used the same process for clients who get audited but lose their documents between filing and the audit. A home or business fire or theft is an understandable reason for a client to lose their documentation, hence the need for the Cohan Rule.

We scan a lot of stuff in when preparing a return, but time is limited so we don’t copy every receipt for our records. That is the client’s obligation.

However, if we see documentation we note this fact in our records. Our contemporaneous record acknowledging we saw the paperwork and actual receipts are frequently enough for the taxing authorities to accept the numbers we report. Must be my honest face.




The Flower Girl

Virtually every number on the above client’s tax return is a guess. The IRS would have to use the same methodology to come to an estimated return. We just beat the IRS to the punch and documented each step we took.

And that is how claiming fake deductions is legal.

Now before you say a word, I can hear you thinking.

For any client willing to pay me a bit extra to see if my guess is a better result than the actual numbers, NO!

My guess will always be conservative and probably overstates your tax liability. The Tax Court has clarified what they allow and don’t when invoking the Cohan Rule. And they always lean in favor of the government. So do I in such instances.

But good try. I like the way you think.



Special Report: Beat the Tax Law Change by Prepaying State Taxes

The recently passed tax bill signed by the President is the largest change to the way Americans and businesses are taxed in over 20 years. Starting January 1, 2018 the new rules take effect, but there are several considerations before we retire 2017.

The biggest issues involve the changes to itemizing and the limitations placed on deductions of state and local taxes (SALT).

The First Issue

The standard deduction has been increased while personal exemptions have been eliminated. This means itemizing will be harder to do until the temporary provisions (corporate tax changes are permanent while individual changes are in effect until the end of 2025 where they revert back to the old rules) expire, are extended or made permanent.

People landing in the “zone” could face a modest increase in tax or at least find their itemized deductions of the past worth nothing extra on their tax return. The “zone” is defined as the amounts between the old and new standard deduction. Example: a married couple itemizes $19,000 per year. Under the old law the additional deductions helped reduce their taxes. Under the new law, with exemptions eliminated and the standard deduction $24,000, the value of those expenses in less than the standard deduction and will not lower their tax burden any further.




The Second Issue

The biggest issue is the limitation of SALT to $10,000 annually. Again, considering a married couple, if you are limited to $10,000 in SALT, where do you have enough deductions to itemize? Mortgage interest is a big one, but even that is limited to $750,000 of acquisition indebtedness versus $1 million under the old law, plus a small amount for home equity interest. (You read that right. Home equity interest is no longer deductible on January 1, 2018.) At today’s low interest rates taxpayers in states without high real estate prices will see less opportunity to itemize.

Charitable deductions are an option if you are inclined to contribute. At least the new law allows a deduction for cash contributions of 60% of AGI, up from 50%. Excess contributions to charity are carried forward up to five years, same as with the old law.

Medical deductions are back to the tax law from a few years back where expenses above 7.5% of AGI are allowed.

Some taxpayers will feel real pain from the loss of miscellaneous itemized deductions. Traveling sales people and others with large amounts of unreimbursed employee business expenses will feel the pinch.

Without a large mortgage itemizing gets difficult. And the allowable mortgage interest is curtailed. No matter how you look at it, itemizing will play a smaller role in the future of tax preparation.

2017 Planning Strategy

There is a one-time window to deduct SALT without limitations (with the exception of the alternative minimum tax and phase-out rules).

Many taxpayers will benefit from paying their property taxes before the end of the year (you can thank me later for giving you plenty of notice (I’ll blame it on Congress when you do)).

Since SALT is limited to $10,000 per year starting January 1, 2018, paying property taxes now are an advantage in high tax states.

Also consider paying your 2017 state estimated tax payment due in January before the end of the year. You can also make a 2018 estimated payment (ES) prior to the end of the year. You only need to pay the state ES payments early because only state taxes are deductible as an itemized deduction on the federal return. Pay as much as possible in 2017 for 2018 to maximize the benefit.




Caution

The alternative minimum tax (AMT) didn’t go away, but is, ahem, minimized for 2018 and after. Prepaying taxes can cause issues that mitigate the benefits. As a general rule, if you already are paying AMT the strategy I’m outlining may not work. If you aren’t paying AMT on your latest tax returns you might be okay unless you were right at the line. Covering AMT is beyond the scope on this short post. Talk to a tax professional if you have any concerns.

More Good and Bad News

I intentionally avoid business tax issues in this post, opting for advice beneficial to individuals, including year-end strategies.

As mentioned above, AMT is unlikely to be an issue for many taxpayers after 2017 as the exemption amount has been increased to $109,400 for married couples filing jointly and $70,300 for single and head of household filers.

The phase-out of itemized deductions has been suspended until December 31, 2025. Considering all the other limitations individual taxpayers face in the new tax bill, phasing out itemized deductions would be rubbing SALT in a wound. (Yes, I intended that pun.)

529 plans, the college savings accounts, have been expanded. After December 31, 2017 you can withdraw up to $10,000 to cover tuition (and only tuition) expenses for elementary or secondary public, private or religious school. (I want to see the politicians putty knifed off the ceiling a year from now when somebody (perhaps me) publishes the amount of tax avoided to send kids to a Muslim school. These will be interesting times, indeed.)

Personal casualty losses are limited to federally declared disaster areas. Uninsured losses outside declared areas are not deductible under the new law.

Exclusion for qualified moving expenses: Gone.

Exclusion for qualified bicycle commuting reimbursement: Gone. (Mr. Money Mustache will not be happy when he finds out.)

Alimony is still deductible for old divorces, but a divorce finalized starting in 2019 does not allow a tax deduction for alimony. Alimony is not reportable income for divorces starting in 2019 either. (I recently concluded a massive alimony case against the IRS after fighting for two years. We kicked the crap out of Revenue for a very sizable refund for my client. There is an outside chance it’s my fault they included this in the tax bill as a result.) (You know I’m kidding? Right?)

The health insurance mandate is gone in 2019.

The inflation index has been changed to the chained CPI-U. All you need to know about this is that Congress wants a smaller reported inflation number for tax issues so more money gets taxed in the future. Old tax guys like me know why President Reagan introduced indexing to taxes in the first place. Reagan must be turning in his grave!

The child tax credit goes from $1,000 to $2,000 and can be claimed to age 17 instead of age 16. There is also a new $500 temporary tax credit for non-child dependents, like older children and dependent parents. The phase out of the child tax credit has been increased to $400,000 for married filers and $200,000 for singles.

Good news! Student loan interest is still deductible up to $2,500.




Final Notes

Many readers will benefit from paying their property taxes this year instead of the due date in 2018. Making ES payments due in January 2018 in 2017 will avoid the limitations of the new tax bill. You can also make 2018 ES payments in 2017 to take advantage of the old tax rules. (See note below.)

The New York State Tax Department emailed to remind me Governor Cuomo signed an emergency Executive Order allowing payment of 2018 property taxes in full or part in 2017. (See note below.)

We finish with Wisconsin, a weird tax animal if there ever was one. Wisconsin has a $300 property tax credit. If you double up property taxes allowing you to miss a calendar year with a property tax payment you will lose the property tax credit worth up to $300. Wisconsin residents need to consider the property tax credit when planning prepayments of property taxes for federal purposes. (Taxes can be so fun. And crazy.)

For New York you need to contact your tax receiver to determine your property tax payment options.

Wisconsin already has their 2018 ES forms out. Check your state tax department for ES forms.

As you can see, the new tax bill doesn’t do a lot for individual taxpayers. If you are lucky you hit it right and benefit. If your luck is less than reliable you might even see a tax increase. Most individual taxpayers will see only modest reductions in tax liability unless they have a high income.

In the near future I will present additional ideas to optimize personal taxes under the new tax bill. Unfortunately, the best ideas will go to business owners in the new world order.

Then again, if you give me enough time I might figure something out beneficial to all parties involved. There are a lot of holes in the Swiss cheese tax bill.

 

Note: I no more than hit the publish button and went to work when the IRS issued clarification on pre-paid property taxes. The IRS released a statement saying property taxes may be deductible if they are assessed AND paid in 2017. That means my idea of following the states who were allowing the activity by extending the strategy to estimated payments will not work unless you want to take your chances in Tax Court (not recommended).

Here is a CNBC article on the IRS release.



Confessions of a Sexual Nature

A clickbait title like above requires some quantification before we begin. It’s not what you think. Fewer than one in a thousand have a clue what I am about to reveal. And the personal finance ramifications are incredible. If you live the story the cost can be a million or more; it can even cost your life.

J Money from Rockstar Finance recently sold his site so he could focus on his blog: Budgets are Sexy. J’s work over the years is legendary. His work has helped countless people in desperate need. As he exited the building he had cash remaining in the community fund. I was contributing $10 per month and added $500 to the Debt Drop program in September in honor of Suicide Prevention Month. The community fund was ending as new management took over Rockstar.

J emailed bloggers asking any who would be willing to take $100 to do a good deed in their community and write about it. I answered I would, but didn’t need the $100; the $100 would be my contribution and the idea I had would require a bit more than $100. J’s original goal was to enlist 20 bloggers; he now has 21. Another example of how the FIRE (financial independence, retire early) community is making our world a better place.

Before we begin, would you hand me the box of tissues next to you. What I am about to write is very personal and painful. This is a story about how I almost sold my business and walked out on life. I had the pills in my hand as I contemplated ending it all. A moment that should have been filled with joy changed my perception of life and love forever.

And it started from my misconception of sex, or more accurately, gender.




The Gift of Life

I’ve become so numb, I can feel you there

Become so tired, so much more aware

By becoming this all I want to do

Is be more like me and be less like you.

Numb, Linkin Park

Mrs. Accountant and I waited to have children. I wanted to be financially secure before bringing a life into this world. The truth is I never wanted children. Deep down I felt I’d be a terrible parent and the thought scared the wits out of me.

When we decided to have children Mrs. Accountant was so happy; I prayed to God the day would never come.

Finances were better than they ever were when I was growing up in the backwoods of Nowhere, Wisconsin. I remember our kitchen table when I was a young child consisted to two sawhorses with a piece of plywood laid across them. I was too young to know how poor we were. Then I grew up.

Now it was my turn to start the next generation. Mrs. Accountant had difficulty conceiving, not that I was complaining. For this crazy accountant it was all fun without a baby bump. I was happier than a pig in, ah, you know what I mean.

Then the inevitable happened. Our first child was on the way and I adjusted to the New World Order.

Regular doctor visits indicated everything was going smooth. We attended Lamaze classes. These sessions were designed to give the mother confidence in giving birth, as if she had any choice at this point. Dad was there to learn a thing or three, too. Unfortunately, fate would exempt me using the newly acquired knowledge.

It was right after the holidays when Mrs. Accountant didn’t feel well one morning. Within an hour her water broke and we on our way to the hospital. The baby was due February 28, over a month early.

The doctor suppressed labor to give the baby time to develop more before breathing air. Eventually the wait had to end. Our first daughter entered this world early and spent 19 days in intensive care at Theda Clark hospital in Neenah, Wisconsin.

In the end it was a minor problem modern medicine could fix. Life was good.

Until we tempted fate again, that is.




The Son of Cronus Awaits the Fool

My brother and I are five years apart in age. It’s only a coincidence my daughters are exactly the same number of years apart in age as well.

Waiting to have children is a double-edged sword. I was 31 when my first daughter was born. If we wanted another child we needed to make up our mind soon.

I wanted more time before we added to the herd; Mrs. Accountant felt her biological clock ticking. I’ll give you one guess who won.

Since it took time for Mrs. Accountant to conceive the first time we needed to get to work. (It’s good work, but the pay is, well, shall we say, awesome!)

We were prepared this time around. Medical issues with our first daughter meant we needed a specialist to prevent a repeat. We found an OB-GYN with ample experience with delivery issues. What could possibly go wrong?

The pregnancy went smooth. Soon the happy day arrived and it was time for baby number two.

Due to the emergency nature of the previous birth I wasn’t allowed in the delivery room. This time I would see the magical moment my child would enter the world with my own eyes.

Our first child came cesarean. The doctor decided it would be best to do the same this time around so no labor issues could ruin what was so far a picture perfect pregnancy.

As reluctant as I was to have children I was eager to see the process in action. Three doctors were working in the delivery room as I watched. The incision was made and then widened a tad before the doctor’s hands massaged my child’s head through the opening.

Once the head was out the rest of the baby slid out easy.

The OB-GYN said, “Congratulations sir, you have a son!”

Another doctor immediately said, “Look again, doctor. Sir, you have a daughter!”

All I remember is mumbling, “It’s both.”

I actually called my child “It.” I was so numb I felt nothing. It? What was wrong with me?

The delivery room was dead quiet from that point on. Mrs. Accountant kept asking what was wrong. For once in my life I couldn’t find words.




Boy or Girl?

The doctor closed the incision as I was shown to a waiting room. I was informed the doctor needed to make some calls to figure out what to do.

I was allowed to see Mrs. Accountant. I managed to explain what had happened.

The birth certificate read:

GENDER: UNKNOWN

How could I face the world? My child, my baby, was a. . .  A what?

The first question people ask when you have a child is, “Boy or girl?”

I had to answer, “I don’t know?”

People think you are pulling their leg when you say it.

It was the middle of tax season (no comments on my planning skills). Mrs. Accountant needed rest so I went home to pick up my oldest daughter from my parents. My office is between the hospital and home.

Bev was still working when I stopped. I couldn’t even enter the building I was trembling so badly. All I could get out was, “I’m not coming back.” I tried to tell her to sell everything; I was done. Bev feared the worst and I wasn’t in good enough shape to tell her what happened. Even driving was a stupid thing for me to be doing.




Medical Nightmare

If you think this story has nothing to do with personal finance you’re going to see how wrong you are. This story is perfect for a tax and personal finance blog.

We had insurance; thank God for that. The medical bills approached a million dollars in the first few years and the out-of-pocket was substantial, too. My wealth at the time was working toward the second million. It is a blessing I had the financial ability to make sound medical decisions without considering money.

Our child needed several surgeries the first few months. The gonads were purplish masses and precancerous. It was, as the doctors said, a “medical imperative” they be removed immediately.

The gonads hadn’t dropped so they were deep inside in the position of ovaries. They were removed when she was three weeks old. That was surgery number one.

Our baby had ambiguous genitalia. There was a distended, though not fully formed, penile structure and a vaginal opening. The urinary tract exited both and was certain to cause infection soon if not corrected.

A decision had to be made in the gender of the baby. The University of Wisconsin Medical School in Madison did a genetic test. The results was X iso Yp.

In laymen’s terms it meant our baby was conceived male. After a few cell divisions the Y chromosome became isolated. Our baby, my baby, had ~15% of her cells with the XY chromosome, or male, and 85% X. XY is male; XX is female. When you only have X instead of XX it’s like have no sex chromosome at all! In such cases the human body tends toward the androgynous, or feminine. This explained the ambiguous genitalia.

In my mind X meant girl. 85% beats 15% so girl it is. The doctors also encouraged us to choose female for our child. One, it’s easier to make a female medically. Constructing male organs are usually less functional and our child would always tend to be more feminine in appearance. And two, the genetic test said girl and my analytical mind would have taken any result with greater than 50%. It’s how I’m wired.

That was surgery two. There were many more to follow.




Blame Game

Guilt took over. It was my fault our daughter was deformed! The Y chromosome only comes from dad and my genetics failed. The guilt was overwhelming. Get me in a corner talking about this and I still fight back tears. The wound cut deep and the pain never went away.

All the while the stuff above was happening I fell deeper and deeper into depression. One night I went out to the barn and put my head in a noose. A few nights later I emptied a bottle of pills in my hand. In either case I stopped short. Don’t ask me why. The pain was so deep there was no feeling left.

As this was happening I attended a support group from Reach Counseling. Only a few children are born each year in Wisconsin with such issues. I was told once an average of two babies per year in the state have what my youngest daughter has. A traditional support group wasn’t available.

This support group had every sex issue known to man in it. Victims of abuse and even a few sex offenders attended. (Many sex offenders are victims of sexual assault in their childhood and seek out support groups to deal with their issues.) And then there were the odd couples like Mrs. Accountant and me.

I thought the whole thing was stupid at first. There was a young woman dealing with a childhood of sexual assault while her dad was there due to assaulting his daughter. Several men were dealing with sexual assault issues from their childhood. Then there was a guy I affectionately called Dudeman. Every sentence he said ended with “Dude!” He was a good guy, just weird.

Every Thursday our group met and talked out our emotions and problems. I broke down every week. “My baby’s an abomination and it’s my fault,” I cried. It was an emotional roller coaster with the only ending a bad one. I shirked my parental duties for a pity party.

Shortly after my daughter’s second surgery I was in the support group crying when a young Asian man dealing with assault issues of his own turned to me and said, “In my culture you would be the most popular man in the village. Your daughter is special. Every man would want your daughter as his wife.”

He was from Laos. His childhood wasn’t easy. And here was this man who could only speak broken English telling me my child is a gift!

The pain and guilt have never gone away, but that was the day I stopped thinking about me and started thinking about my little girl. She is NOT an abomination! She is a GIFT! I was acting like an a$$. My daughter needed her dad and not some sanctimonious coward trying to find the courage to end his life.

The tears stopped instantly. I continued attending the support group for about a year. The young man from Laos eventually moved on. I doubt he even knows he saved my life and gave a beautiful young lady a good childhood.

My youngest daughter reaches the age of majority in a few months. She is a happy person filled with joy and dreams. Maybe I wasn’t such a bad dad after all.




Reaching for Help

Then I got an email from J at Rockstar Finance.

The moment I read the letter I knew I had to participate and I knew exactly what I wanted to do.

I hated Reach Counseling at the time. They symbolized my greatest failure in life, or so I thought. Now, almost 18 years later, I wanted to contribute to the organization that changes the lives of so many, changed my life.

Reach Counseling helps sexual assault victims in northeast Wisconsin. They also have programs to help sex offenders rebuild their life. The work never ends.

Even if you read the news poorly you know of all the women coming out in the #metoo movement. The Silence Breakers are Time Magazine’s people of the year. The number of people floating through my social media feeds raising their hand as also a victim of sexual assault is depressing. Most people knew back brain about the casting couch. Harvey Weinstein isn’t a total surprise.

The real surprise is the massive swell of victims silently suffering finally coming out to be heard. I’ve seen plenty in my days and know the devastation sexual assault causes. Almost from the beginning of this blog a woman reached out to me for help. She was sexually assaulted by her step dad since she was three or four years old. The assaults went on for years. She is in her forties now and struggles with the issues. She is intelligent and hard working. She is a survivor! Now I help her with personal finance issues so she can have the life she deserves, the life her stepfather raped from her.

I contacted Reach Counseling and showed them the email thread from J. I spoke with Kim Massey at Reach and explained to her what I wanted to do. Mrs. Accountant came with me. She said I was shaking as I told the story. The emotions are still there as I fought back tears. I haven’t evolved as far as I pretended.

The goal is to pay it forward. I can’t pay Reach back for what they did. Sure, I can donate money and I did: $500. But there was much more I had in mind.

I outlined a three pronged program serving victims of abuse, sex offenders and those at risk of abuse. I surmised if money is the number one reason for divorce, financial issues might pay a role in sexual assault and the healing process.

The issues people face when assaulted runs deep. Emotions run wild as the victim of crime tries to deal with what happened. And the kids still need food on the table.

Women are disproportionately affected. When I donated the $500 I had no string attached. I was informed a few hours ago by Kim Massey (I’m writing this the night before it’s published) some of the money was used to help a single mother with two children ages 9 and 12. They just moved into an apartment and have no furniture. The money was used for a Christmas tree and some gifts for the kids and even something for mom. The unspent money is in a fund for other families. I was told “. . .this gift filled their house with joy!”

J reminded me why I write this blog in the first place: to help people understand money better. I am working with Reach to build a program where I personally help people with serious financial issues. They need this advice more than anyone. I will use my experience and knowledge to make my community a better place.

In the past I’ve raised funds for Special Olympics. Now The Wealthy Accountant will adopt Reach Counseling, contributing a significant portion of its income to their cause along with my time and talent.

Please join me in this important work. Together we can do more than any person alone can. Support organizations similar to Reach Counseling in your community. Consider donating to Reach as well.

The workload is endless and demanding. You can read more about Reach Counseling and contribute here. No gift is too small. Consider an automatic monthly gift. This community is blessed with so much we can make a difference. You never know who you will help. It could be a woman fighting to survive after an assault; you might help a young girl break free from a violent and abusive environment; or maybe you’ll help a crazy accountant who needs a knock up beside the head to understand his child is a gift, a beautiful, wonderful gift.

Reach Counseling also has a crowd funding fundraiser going on right now. If you think men can’t be victims of abuse, think again. There is a moving video at this link of a man who found Reach after childhood abuse. It gave him a new lease on life.

Christmas Eve and Christmas morning I’m going to raise my glass in a toast to the single mother with two children struggling to survive.

May you have peace, my friend. May you have peace.

 

Note: I’ve attempted writing therapy on this issue in the past. I always cover with something different to get the true story out. You can read an earlier attempt here.