Andre Sugars’ Three Building Blocks To Healthy Personal Finances

Andre Sugars’ Three Building Blocks To Healthy Personal Finances

It's understandable if things might feel a little bit … shaky right now for you. If you pay attention to the media, you are seeing trade wars with China, uncertain stock markets, apocalyptic elections rumbling in the future, even the Apple juggernaut is seeing its empire show signs of trouble.

All of these, by the way, are good reasons to fight for your own personal clarity in the midst of trouble all around.

So, we press into what we CAN control, and that's your personal financial foundation.

The tax return is filed, so it's the perfect time to assess what went well, what didn't, and if you're content with the outcome. There are a number of things you can start doing today so that next year is your best, most tax-efficient (and saving) year to date.

I wouldn't be doing my job if I didn't suggest a good next step: give me a call: (310) 327-1985. We will help you set a game plan for the year ahead. Taxes are only getting trickier, and it helps to have someone with you in the trenches.

Leaving the tax component aside, it's also a good time to examine where your money is going.

Are you frugal? Do you spend at will? No matter where you fall on the spectrum, there are a few ways you can direct your cash flow so that you can benefit in years to come.

After all, it's never too late to begin money-friendly habits.

Andre Sugars' Three Building Blocks To Healthy Personal Finances

"There is a gigantic difference between earning a great deal of money and being rich." -Marlene Dietrich

The first part of your personal finance foundation is actually the absence of two poisons: taxes and debt.

Both of those words might sound like nails on a chalkboard, and that's exactly why you should pay off both as soon as you can. We've talked (and do talk, and will talk) about taxes a good deal, and it's no secret that paying taxes is your duty as a citizen. In addition, we spent the last few weeks discussing ways you can pay and the penalties that come for those who don't.

Pay your taxes. Do it.

The debt piece is obviously more nuanced from person-to-person. Undergrad, grad school, credit card, car, home, etc. The (odd yet accurate) analogy of eating an elephant comes to mind — one bite at a time.

Debt is another item I'd love to chat about with you, as we can assess after-tax interest rates and how they might affect potential investments. If you've ever ridden yourself of debt before, you know the ensuing freedom. I want that feeling for the entirety of your financial picture.

The second block: Hold Wisely

Once the word "debt-free" is within reach of your vocabulary, the real fun begins. What's the real fun, you ask? It might sound nerdy … but saving and investing are two keys to financial wealth and freedom.

We've discussed ways you can save and invest before, but again — you are never too late for either.

Remember, post-tax season offers a fresh start. Let's make it count!

The first question I'll ask: Do you have an emergency fund established? This is key to your savings account. It should contain three to five months worth of savings, because life is full of unexpected costs — car accidents, medical bills, stolen items — it's important to play safe. After that is established, then you can save for future costs like a new car, home, and so on.

Investing is another beast … one that can lead to meeting your financial goals way quicker. If you are not a professional, I strongly recommend sitting down with one to discuss investment opportunities for you and your family. The small cost of a meeting leads to big gains in the future. Ask around for some trusted referrals. A trusted South bay financial planner could be essential for your financial success moving forward.

The final block: Spend Generously

And I don't exactly mean spend everything you have. Clearly, I led with two things you should do first with your money: pay off taxes/debt and save/invest after you do. But this third step is inevitable — we spend money (most) every day in some form or fashion.

Where are your dollars going?

What is the ratio of money you spend on yourself vs. money that is donated to South bay organizations or people you believe in? One of the most life-giving components to saving and earning money is so that you can help others in the process. What if someday you could invest in someone's start-up business so that they could pursue their dream? What if you could bless your children and help them with college tuition? There are plenty of ways to spend, but one of the best is on others.

But truly, it is your hard-earned money after all. How you spend is entirely up to you. And it's a good time when you can treat yourself every now and then. You are human after all. Just remember that when the aforementioned steps are done first, treating yourself to a new ____ will feel much more special.

This whole subject of personal finances boils down to prioritization. Reversing this order of operations isn't illegal, but in the long run … it might be detrimental.

Give me a call today and let's dream about your new, free financial future.

Warmly,

 

Andre Sugars

(310) 327-1985

Champion Tax Service

 

College Is Expensive But South bay Families Can Save Big Through These Tax Breaks

College Is Expensive But South bay Families Can Save Big Through These Tax Breaks

What, you think I'm on vacation?

Yes, the tax deadline has passed. But we're still available, and handling post-deadline matters for South bay clients.

 

But moving along to today's subject: figuring out how to pay for college tuition. Things are different from the days when I considered college…

I'm talking to South bay parents left and right who are scrambling to figure out ways to manage skyrocketing tuition costs. Well, I'm happy to tell you that the tax code is here to help.

College Is Expensive But South bay Families Can Save Big Through These Tax Breaks

"The University brings out all abilities, including incapability." -Anton Chekhov

College is expensive.

Let's put that fact out on the table because we all know it's true, and most of us have been affected by this reality in some way, shape or form.

Side note: College is even more expensive if you're trying to cheat the system so your kid gets into a prestigious school. We're all seeing how that turns out … right before our eyes.

But did you know there are various tax breaks which can help chip away at the cost of your son's or daughter's (or your own!) college tuition?

Note these steps if you're interested in saving on tuition costs with some help from Uncle Sam.

American Opportunity Tax Credit (AOTC)

This is the first of two educational tax credits I'd like to explore. The AOTC provides up to $2,500 for eligible students, and covers education expenses spent during the student's first four years of college-level education.

In addition, the AOTC is refundable. In other words, if the credit reduces your tax liability to zero, you receive a refund for the amount left over. Pretty sweet, right? If you wonder what students are eligible, this page highlighting the AOTC will give you a better idea.

Lifetime Learning Credit (LLC)

The second tax credit I'd like to discuss offers a max annual amount of $2,000 per tax return. You might have guessed this, but the LLC is for students who complete more than four years of college, furthering their education in any given field.

But as opposed to the AOTC, the LLC is not refundable. If you're left with excess credit after your tax liability lands at zero, you will not be refunded the extra cash. If you'd like more info on the LLC, there is a similar page on the IRS website.

Student Loan Interest Deduction (SLID)

Moving on to deductions, there are again two I'd like to cover. First, SLID offers an opportunity to claim up to $2,500 of interest paid on student loans during the year.

This should alleviate some student loan worry for the 69% of college students who relied on student loans in 2018. With an average debt of $28k after graduation, I hope any such student would take advantage of SLID in the future.

Tuition and Fees Deduction (TFD)

TFD provides up to $4,000 for … you guessed it, tuition and fees. But there is a caveat to where the deduction currently stands. Congress has yet to "re-approve" this tax deduction, known as an extender, and therefore has the TFD on hold for the time being. It's important you know about the deduction of course, but something to look out for is when Congress actually approves it once more.

529 Plans

If you don't have a 529 account, which lets you accrue funds toward your child's college tuition tax-free, I strongly recommend you look into it (if you have children who might go to college in the future). Every little bit of savings will help, and anything you can contribute on a month-to-month basis is a true gift you'll give your son or daughter someday.

Once your young scholar ships off to the university, 529 account funds can be spent (again, tax-free) on things like tuition, room and board, books, fees, etc.

Support Your Alma Mater

This is a fun one. If you have extra cash and want to support students attending your alma mater, you can start a scholarship fund to help students pay for school.

The donations you make to said (potential) scholarship fund will be tax deductible, and the university's finance department should walk you through the IRS guidelines to set up the scholarship in the correct manner.

So there you have it. Although college costs may seem daunting, there are ways to earn a little money back on your important investment. If you have any other questions about how these codes and deductions work, please give me a call.

I'd love to cheer on your scholars, while helping you save dollars. 🙂

Warmly,

 

Andre Sugars

(310) 327-1985

Champion Tax Service

 

Andre Sugars’ Under-Utilized Pet Tax Deductions

Andre Sugars’ Under-Utilized Pet Tax Deductions

Apparently, there are some politics things happening these days.

But even more apparently, the tax deadline is three weeks away.

Politics? As the young people say, ain't nobody got time for that.

But you know what we DO have time for? Saving you a boatload on your taxes, and finding creative ways to do that, even if you don't think about it.

I have an example for you today, but before I get there, allow me also to inform you that there is currently $1.4 billion (yes that's with a B) in unclaimed tax refunds sitting on Uncle Sam's books right now from 2015. If you somehow didn't file a tax return in 2015 (or maybe you did, and you just … aren't quite sure it was done right), well, we're right here. Let's help you get what is rightly YOURS.

It's what we're here for.

And you know what we're also here for? Creative tax deductions. You "pet"cha

Andre Sugars' Under-Utilized Pet Tax Deductions

"The better I get to know men, the more I find myself loving dogs." – Charles de Gaulle

I'm going to dip into the "something you don't hear every day" file with an interesting bit of information: our pets can save us some serious cash.

Well, it may not be serious cash in terms of a massive amount, but I am serious about this interesting set of pet tax deductions.

Here are a few ways a pet could save you, or someone you know, money in the future. Man's best friend just got friendlier…

Medical-Related Expenses

Many South bay individuals have been diagnosed with a physical or mental condition that requires a trained therapy animal.

I'm here to tell you a therapy animal can be counted as an itemized medical expense.

However, I'll reiterate … this is only the case if your doctor has prescribed you one of these therapy animals. No matter how comforting it is to get home and snuggle with your dog after a long day at work, that's not the kind of thing that qualifies.

The write-offs mostly pertain to food, veterinary bills, training and grooming.

On Guard

If you have a guard dog that looks over your South bay business after-hours, you might be eligible to write off similar expenses (food, vet, training, etc.) for a job well done.

I say "might be eligible" because it's important you take notes of the hours your dog works on a weekly basis.

But the IRS might call you to question when they realize that your "guard dog" is your Corgi lounging around the office. Make sure, if you are going to go through the effort of keeping solid records for your guard dog, that it's actually a guard dog.

Fostering Hope

Here is something you might not know about in the first place: there is a need out there for fostering animals while shelters find long-term homes for a pet.

This is certainly a noble cause, especially if you already have pets of your own. And write-offs accompany your effort to find those pets a permanent place. Again, it's important you keep scrupulous notes and documentation about what you spend on your foster pets before you apply for a charitable deduction.

Of course, any pet-owner will tell you that pets are certainly more than tax write-offs. And hopefully you are now aware of one more way they help us out.

All the more reason to treat our animals well. They clearly care for us.

Warmly,

 

Andre Sugars

(310) 327-1985

Champion Tax Service

 

Andre Sugars’ Three Big Tax Scams And How To Beware

Andre Sugars’ Three Big Tax Scams And How To Beware

Now we're cooking with gas.

After weeks of reports that refunds were down, last week's data from the IRS shows a new trend. Although overall quantity of refunds are down, now the average refund is up 1.9%. After so many headlines to the contrary, I suppose that qualifies as good, national tax news.

But here is the thing to remember about tax refunds:

That is YOUR money that you're "getting back".

Think of it like this: you go to a shop and buy something for $5. You hand the cashier a $10 bill. The cashier hands you back a $5 bill as change. Did you just get more money? Of course not; you paid more than the bill, so you got YOUR money back.

With taxes, many South bay people are doing this throughout the year, only backwards. You're paying the "cashier" (er, the IRS) all year long in withholding and estimated payments, and then you hope you've paid enough to cover the tab. If, at the end of the year, you had paid $10 for the $5 product, your $5 change is your refund.

Imagine this scenario now — you have a friend who buys the exact same product for the same price and, after all the payments all year long, he paid the cashier $100. WOW, he gets a $95 refund! That's way more than your $5. But did your friend "do better" than you did? Did he work the system to his advantage? Of course not. Quite the contrary.

A relentless focus on helping our South bay clients KEEP more of their money in their accounts is what drives our work. Yes, we believe that government needs funding, and yes, taxes are how that happens.

But our mission is that our clients would never fall victim to the confusion inherent within our tax system simply because they didn't know any better.

It's a great mission, and it drives our hearts and minds during this season. And we are grateful that you let us do it for YOU.

Now, speaking of falling victim…

Andre Sugars' Three Big Tax Scams And How To Beware

"Accuracy is the twin brother of honesty; inaccuracy, of dishonesty." – Nathaniel Hawthorne

Around this time of year, scammers and fraudsters come out of the walls to take advantage of unsuspecting taxpayers.

Lest you think, "That would never happen to me," I want to provide you with some tax scams to look out for. It helps to know how scammers strike, and the more you know, the more friends you could help in the future.

Here are a few of the "usual suspects", and how they'll attempt to access your information and put a damper on your entire financial world.

1. Something's Phishy

Here is where they try to steal your info. Phishing is defined as "the fraudulent practice of sending emails purporting to be from reputable companies in order to induce individuals to reveal personal information".

If you receive an email saying it's from the IRS, DO NOT click that email. The IRS will never initiate contact about a bill or refund via email.

Similarly, if you receive a phone call "from the IRS", I want you to hang up the phone. If the IRS needs to communicate with you, they will first do so through postal mail.

2. Bad Tax Pros, Bad Charities

Unfortunately, some South bay tax professionals enter the business with the sole purpose of illegal dealings down the road. They want your information for their own financial gain, and it's important you do your research before working with them.

Do a thorough online search, read reviews, and ask them if they have referrals you could talk to about their services. (Speaking of which, a review from YOU on Google or other social platforms would always be nice!)

In addition, similar scammers exist in the (fake) charity world. They claim your donations are tax-free, only to solicit money from you with no real purpose behind their organization. Again, these days you can do a lot of online research on your own. But if you have any checks in your system, and don't have friends or family who would recommend the charity, it's probably best to stay away.

3. False Claims

First, please do not have anyone prepare your taxes who asks you to sign a blank return or charges fees based on a percentage of your refund. If they do, that's a big red flag.

Second, scammers often try to get taxpayers to falsely claim income so they can qualify for the Earned Income Tax Credit. This is best avoided with honesty, and not falsifying anything on your return that would affect the Earned Income Tax Credit or Child Tax Credit.

With honesty as your backbone, here's the summary of freedom from fraudulent activity:

  1. Have Your Guard Up: If anyone contacts you from the IRS, be wary of what they are trying to sell you. Always be skeptical.
  2. Triple-Check Your Sources: The internet is a vast, scary place (where most scammers reside), but there are also great resources (keyword searching through Google etc.) to utilize and find out if the organizations you're working with are frauds or the real deal.
  3. You Guessed It: Please feel free to reach out to us! Not only do we want to help you navigate tax season (all year round), we want to keep you far away from saboteurs. In that sense, view us like Tax Ghostbusters.

We exist to come alongside you and serve…

Warmly,

 

Andre Sugars

(310) 327-1985

Champion Tax Service

 

IRS Form 4852: Champion Tax Service Explains the Substitute for the W-2

IRS Form 4852: Champion Tax Service Explains the Substitute for the W-2

 

Word on the tax professional "street" is that tax filing numbers are down across the board so far. That is from data released by software providers (though this year, of all years, I simply don't understand why somebody would use software), as well as overall numbers from the IRS, AND those who are using a professional.

It seems that many South bay taxpayers are a little skittish about all of these changes.

And with further news rolling around the newsfeeds that some are seeing lower refunds than they might have expected, well … it seems that this tax season has been a little rocky for the industry.

But that being the case on a broad level, we at Team Champion Tax Service are in the midst of one of the best tax seasons we've ever experienced. From a bunch of wonderful new South bay clients, to the gratification we've experienced from helping long standing clients keep MORE than they thought was possible … well, suffice to say that we love what we get to do.

So thank you for your referrals, and for continuing to trust us as you have been. And if you haven't gotten started on it yet … well, having a pro in your corner can make a big difference. So take advantage! Shoot us an email or give us a call: (310) 327-1985. We'll walk you through whatever you need.

And speaking of what you might need, we've received a couple of questions about what happens if you haven't received a W-2 yet. So I thought I'd take a moment to answer that for you…

IRS Form 4852: Champion Tax Service Explains the Substitute for the W-2

"Sometimes, disaster can inspire ingenuity." – Michael Arden

If you work, or have worked, for somebody else, you know a W-2 form is essential when filing your taxes. Without it, you're stepping into the batter's box without a bat.

This particular service form summarizes your annual income, benefits and taxes.

But if you have yet to receive your W-2 from a current or past employer, I want you to first contact them and ask why the delay. If you receive little response, or an unhelpful one, please consider these three important steps. You might need to implement one or all three of them in an effort to obtain the document and get on with your filing.

If none of these three options work, please reach out to me immediately. We can discuss the next best steps you can take moving forward.

Reach out to the IRS

The good part is that the IRS has made an effort to streamline their customer service questions through a toll-free number: (800) 829-1040. Calling this number is your first step toward receiving a substitute W-2 which you'll need ASAP.

The bad part in dialing this number is the automated process it will walk you through (and the potentially long wait time). But if it's a matter of receiving such an important document, enduring the process is a solid option. In addition, before you call, make sure you have these documents/details on hand:

– SSN

– Employer's name, address and phone

– Dates you had or have been employed

– Estimate of wages you earned from the previous year

We can help you with this.

Fill One of These Out Instead

If you're low on patience with the IRS, and your employer has yet to deliver your W-2, there are a couple more forms you could fill out.

Form 4852 is a "create your own" W-2 form, and you can use some of the information you prepared for the IRS, and therefore have on hand, to fill it out.

If the thought of creating a substitute W-2 makes you wary, you could request a filing extension using Form 4868, which will give you an extra six months to file your taxes. And if an extra six months is not enough to receive a W-2 from your boss, then you might have other issues to resolve in addition to filing taxes on time.

We can also help you with this.

Correct Any Mistakes

Sometimes, after completing the custom W-2 using Form 4852, taxpayers will send that form into the IRS, only to receive their actual W-2 days later. Use the real W-2 to double-check the information you wrote down on your 4852.

And if, for instance, you forgot to mark down a bonus you had received (in addition to your income from the year before), I don't want you to panic.

Form 1040X isn't as intimidating as it sounds. It will help you record the changes necessary to your W-2, which the IRS will fix after you mail it in.

Again, if you complete these steps or have further questions, please give me a call. Trying to file your taxes without a W-2 is not a happy feeling … but you're not alone.

I commend any effort you take to resolve this issue on your own, but don't hesitate to reach out for help. Talking with people like you is why I love my job.

Warmly,

 

Andre Sugars

(310) 327-1985

Champion Tax Service

 

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