Hello, <<First Name>>:
 

This month's task is not as cool as January's Financial Super Bowl (projecting your spending), but it's definitely still annoying:

It's Time to Check In With Uncle Sam

 


This is just as creepy as it was last year 

You may have already filed your 2019 federal income tax return early, but here are a few tax time tips applicable every year:

• If you have any kind of complexity in your tax situation -- or doubt that you are doing it right -- hire a CPA. It will be worth every single penny. Good sleep has a dollar value. (I do it. I attribute all of my lost sleep to the Seattle Mariners)
• Don't forget that you can still make IRA and HSA contributions for 2019 up until Tax Day in April 2020. If you have a fully funded emergency fund, no high interest debt, AND you have extra cash laying around, you should absolutely make a contribution if eligible. Compound interest is your best friend. 
• Use this time as an opportunity to assess if you need to adjust your withholdings at work, or with Social Security or a pension. The updated 2020 IRS calculator I linked to is actually quite handy. Big recent changes in the tax code are bringing a lot of surprises to taxpayers.
• Make sure you don't forget any crucial investment-related tax forms, especially if you have a taxable brokerage account. Before you file, be sure to check the appropriate sections of the custodian's website where your accounts reside. (For clients with TD Ameritrade accounts, use your advisorclient.com login and just go to the tab titled "Statements and Tax Documents." For Betterment users, log in and go to "Documents" then "Taxes.")
• Here's a good summary of 2019's 'SECURE' Act, another jumbled piece of legislation shaking up the world of tax/investing/retirement. 

 

IF YOU'RE SKIMMING THIS MONTH'S TASK, STOP HERE 

This yearly reminder calls for its own section.

Please, for the love of Gordon Gekko, do not, under any circumstances, try to target a large tax refund every year.

Here's why, admittedly heavy on the sarcasm:

• A large refund signifies you gave the federal government an interest-free loan. Things will be better for you when your money is working for YOU.
• There is no magic benevolent refund fairy - a big refund is not a free lunch. It doesn't matter if a friend or family member said they got a big refund, that's on them and the government is always going to get exactly what it's owed. 
• You probably won't spend a huge refund wisely (sorry, not sorry).
• A little piece of me will die if I learn this is something you do. Help me stay healthy!
• It's OK if this is something you've done in the past. But you've hired me to fix this kind of thing, and now you know. Also, if you don't comply....

Good luck! If you have any tax questions or concerns, just let me know. If we can't get to the bottom of an issue then we'll get you a referral if it's better suited for a tax pro to address.