Stalking the Accountant: Tax Planner for the New Tax Laws

The Wealthy Accountant is giving over $1,000 in cash away to subscribers. Don't miss out! Subscribe today. Check the Where Am I page for drawing dates.

 

Tax season is here with concerns about tax law changes effective this year while we still use the old rules for preparing the 2017 return. Several new tools are available to help you determine how the tax code changes will affect you.

Drake Software, the program I use in my office, has developed a Tax Planner incorporating the changes in the TAX CUTS AND JOBS ACT. If we prepare your return you will get a copy of this diagnostic automatically at no additional cost showing what your taxes would have been if the changes applied to 2017. No more guessing.

I am also officially opening my doors for additional tax clients! This is important. This summer will be busy as serious planning is needed for all taxpayers with rental properties or business income. Past advice is out the window as new rules mean new advice! Some people will need to consider different entity structures to take advantage of the new rules. Regular clients will have first pick of consulting sessions. If slots are available after serving clients I will open the doors for non-clients. I’ll keep you informed.

If you prepare your own return you should consider Drake’s DIY program with the link below and in the right column. You will receive the same diagnostic tax professionals using Drake provide.

 

If your tax professional uses software without an effective planner or you prepare your own return outside this blog you might consider the Tax Proposal Calculator offered by the Tax Policy Center. I’ve played with the calculator and find it helpful.

[After I published, Jeff from Maximum Cents (a blog you should consider reading) left a comment with a link to an even better tax calculator than I provided above.

https://www.maximumcents.com/tax-reform-calculator-much-will-save-pay/

This is what I love about the blogging community. Our group intelligence blows away anything I can do on my own. Thanks for sharing, Jeff.]

 

The stock market has been on a tear. Now is the time to consider monitoring your wealth building with Personal Capital. The easy money has been made with the massive market run-up. Having a plan and clear visual of where you stand financially is a powerful resource. Clicking the image below takes you to Personal Capital. Remember, you can’t manage what you don’t know.

 

Concerns over the market also have people thinking about different places to invest their money. Lending Club and Prosper were a great alternative until issues arose a year or so ago. I’m currently withdrawing all my funds from Lending Club and Prosper due to the high level of risk compared to the declining returns. This is a slow process, but nearing the end.

A similar investing model backed by real estate is offered by Peer Street with comparable returns. Lending Club and Prosper are unsecured loans with a higher level of risk. Peer Street isn’t a perfect answer, but certainly a consideration for a limited percentage of your portfolio. Clicking the image below takes you to Peer Street. Kick the tires and let us know what you think in the comments.
Diversify Your Portfolio with PeerStreet Investments

 

Student loans came up in the comments this week. Debt is the number one enemy of wealth and student loans are structured with serious risks to the borrower. I’ve pasted a link below to SoFi. At the very minimum kick the tires. Before interest rates climb higher you want to get your loans under control.

 

Before we get to the fun stuff, remember next week is our drawing for $100! The drawing is open to all subscribers. Check the Where Am I page calendar for more drawing dates and details.

 

Now for the fun stuff to enjoy the rest of your weekend!

 

What I’m Reading

Richard Branson has made a name for himself doing business differently and having fun in the process. I bought several of his books a few weeks ago and cracked open The Virgin Way: If It’s Not Fun, It’s Not Worth Doing.

Richard’s style is different and it resonates with me. I fell in love with the FIRE community for their frugal ways. Early retirement always sounds nice, but retirement in its traditional form isn’t for me. Enter Sir Branson.

Branson convinced with his words and lifestyle you can have the best of both worlds: free time with family and doing the things you enjoy, plus keeping the business. He also provided me with ample evidence I need to listen more and better. I tend to talk too much. (If you’re reading this dad do not comment. We, ah, you can laugh about this at the card table.)

Branson has a refreshing style I enjoyed more than I originally thought. If you want a fun, entertaining and informative read, I recommend The Virgin Way.

 

What I’m Watching

Natural history and science are common threads in my viewing habits. My guess is you’ll enjoy as much as I did this YouTube video on how the Earth’s landmasses moved over millions of years. [240 million years ago to 250 million years in the future]

 

Professor Brian Cox is a favorite. In the video embedded below Cox explains The Biggest Threat to our Civilization.

 

All that serious talk requires balance with a humor piece. Jim Jefferies is a riot. His humor reminds me of George Carlin with an Australian accent. Here Jefferies explains the situation between North Korea and the U.S. Enjoy.

 

What I’m Listening to

Talking about Australia, here’s a song from Midnight Oil I listened to this week. [Beds are Burning]

 

Finally, I rarely listen to recent music releases. The following video of Somebody That I Used to Know played at the gym ad nauseam a while back and YouTube must have heard about it. Now I can’t get the darn tune outta my head. I’m passing the blessing on to you.

 

Enjoy your weekend, kind readers! Can’t wait to get back with you again Monday.



Personal Capital: You can't manage what you don't know.

Posted in

Keith Taxguy

16 Comments

  1. Jeff @ Maximum Cents on January 27, 2018 at 8:35 am

    I tried the Tax Proposal Calculator but didn’t find it very useful since there are only a few options to select.

    I wrote about another tax reform calculator that has more inputs: https://www.maximumcents.com/tax-reform-calculator-much-will-save-pay/

    According to this calculator I will save about $4,800 in taxes under the new reforms. I will be using this extra money to continue to invest in stocks. My brokerage account has gone up 71% over the last 5 years compared to 54% for the S&P500. Even if I assume the average 10% annual rate of return, this tax reform will pay off nicely in the long term.

    • Keith Schroeder on January 27, 2018 at 9:03 am

      Awesome, Jeff! I’m going to edit this into the text above in case some people skip the comments.

  2. bob on January 27, 2018 at 11:38 am

    seems like this site is becoming more and more just a collection of referral links, sad.

    • Keith Schroeder on January 27, 2018 at 12:05 pm

      Bob, Saturdays are for Stalking the Accountant. The links are there for reader’s reference. Some are referral links, most are not. I put in the work to publish over 800,000 words in the last two years. At least let me earn half of minimum wage for my time. And, as I noted earlier, every dime of profit goes to charities. That alone is worth considering affiliate links here.

      This post’s links came up over the previous week. For example, when a reader has issues with their student loan and I pass the info to everyone, that is a value added service. All the videos are NOT affiliates though YouTube might have ads on the videos, something I don’t control.

      All the links I provide are resources readers in this demographic look for. That’s significantly different from slapping every program on every page. I break up text on regular posts with ads to help the eyes avoid unbroken solid text. I also use images.

      Some of this stuff ends up on the TWA Recommends page, but not all. I share the referral because somebody asked and I shared what I knew. If there’s as affiliate program I try to sign up. It all goes to help the kids helped by the charities this blog supports.

      • Taylor on January 28, 2018 at 8:15 pm

        This also rubbed me wrong, but mainly because the services that are paying a referral fee are not clearly indicated. I don’t have a problem with a man trying to make a few bucks, but I prefer to know what motivations exist for them when they mention a service. Disclosure builds (or maintains) trust.

        • Tvot on January 29, 2018 at 10:46 am

          He clearly states all throughout his blog which affiliate links provide a commission.

          • Taylor on January 29, 2018 at 11:44 am

            Where? I do not see any mention in this post for Drake, AutoQuotesDirect.com, Personal Capital, PeerStreet, nor SoFi.



          • Tvot on January 29, 2018 at 3:59 pm

            Maybe not in this post particular, but like I said. He mentions it throughout the blog…

            {“Disclosure

            I am biased for a couple of reasons. First, I use the software in my office and like the way it works. Second, I get paid a percentage of the fee you pay to Drake Software. The DIY online tax program is the largest source of income for this blog. It pays the bills, keeps the lights on, and gives me a reason to keep writing. I think it is only fair to let you know up front my relationship with Drake Software. I would not recommend the program if I did not believe in it; I wouldn’t use it in my office either.

            If you want to support this blog, be sure to start with the link on this page. If you don’t I will not receive any income. Once you have opened the file there is no problem. You might also want to bookmark this page for future years when you file. For some reason I keep getting hungry every year so I really appreciate return customers.”}

            That is one example. I don’t have the time to go through all the blog posts to find the rest of them. But if you go through “TWA recommends” you will see a few that state it’s an affiliate link, although some don’t and I suppose I can’t be 100% sure if they are or aren’t. So I see your point. But to be on the safe side, you should probably just assume that if they offer him an affiliate link, he is going to use it. I don’t see why that would be an issue at all, though. Either it’s a good service, you use it and he makes a buck. Or it isn’t and he doesn’t. Or you could just go to the sites direct and leave his links out of it.



          • Taylor on January 29, 2018 at 9:00 pm

            You’ve made my point. Responsible disclosure allows the reader to understand affiliate motivations without having to read other parts of the blog. He can keep the content exactly the same… just disclose sponsors each time. MMM does a good job of this.

            And for what it’s worth, AutoQuotesDirect.com is a total junk site. Give it a shot.

            Hoping for more responsible disclosure in the future, if Keith is up for it. If not, it’s his BBQ, and those bothered can always find another one.



  3. RAnn on January 27, 2018 at 12:20 pm

    Lending Club and Prosper looked great a few years ago when the stock market was anemic and when they were returning 7-8% on average. Last year I broke even with Lending Club and only made a few dollars with Prosper. Needless to say auto reinvest was turned off long ago.

  4. Mark on January 27, 2018 at 9:38 pm

    I can’t find any pricing on the 1040.com site – perhaps I’m just missing it? Or what the differences are between the different plans?

    • Keith Schroeder on January 28, 2018 at 7:54 am

      Mark, it depends on the return. The program calculates the lowest fee when the return is done so pricing is hard to show up front. Here is the full pricing:

      January and February
      Basic Free
      Deluxe $24.95 ($19.95 per State)
      Premier $44.95 ($24.95 per State)

      March thru April 15
      Basic Free ($14.95 per State)
      Deluxe $29.95 ($19.95 per State)
      Premier $49.95 ($24.95 per State)

      April 16 thru October 15
      Basic Free ($19.95 per State)
      Deluxe $34.95 ($24.95 per State)
      Premier $54.95 ($29.95 per State)

      Taxpayers will automatically receive the lowest price option available for their tax situation.

      I lifted this from my admin page they provide me.

  5. Dave on January 29, 2018 at 11:12 am

    Keith,
    What is the best way to engage with you regarding possible consulting? email, contact via comments (ie. like this)? Also, could you possibly do a post on how to best navigate / manage a situation when someone has multiple IRAs (deductible and non-deductible – ie. IRA aggregate rule) and how it impacts taxable distributions & Roth IRAs – this can be confusing if not handled correctly so want to get expert insight / recommendations.

    Thx,
    Dave

    • Keith Schroeder on January 29, 2018 at 11:20 am

      Dave, the Contact form is the best way to reach me. I’m unable to transfer comments into my database and we don’t want to air personal information publicly.

  6. madmulcher on January 29, 2018 at 3:17 pm

    think the concern with Lending Club might be hyperbole. My returns on there and Prosper have hovered around 7% for years. I’m going on year 8 with lending club. i tried Prosper, had similar success, but found it redundant to have both so am phasing that out. Have never used autoinvest features. the normal min investment on Peer St is $1000 tho! have been using that as well with similar success. generally hoping we continue to see higher rates without damaging the economy.

Leave a Comment





%d bloggers like this: