Weekly Digest – April 14, 2023
Taking cues from my prior blog posts I have kept up my daily walks on the beach at sunrise followed (most day’s) by a high intensity indoor workout. This week I increased my walk by 1 jetty which added to my miles and photo ops. Just a few more days to go as I look forward to our “after tax season ski trip” to Snowbird Utah and then a visit to my daughter who recently moved to southern California. Can’t wait!
This week on Rockaway Beach at sunrise….
I was glad to be able to “rescue” a few of the horseshoe crabs we passed struggling on thier backs in the surf. Fund fact: Horseshoe crab blood contains the enzyme limulus amebocyte lysate (LAL) which causes the blood to coagulate when exposed to bacterial endotoxins. Biomedical companies use LAL to test medicines, vaccines, implants, and more for endotoxins to ensure medical equipment is safe for people.
Wishing everyone a great weekend with good weather, counting down the days to our April 18th tax deadline.
WEEKLY TAKE AWAY
April 14th and crazy times here, especially when our tax software is not producing a correct result from our input and we know it’s just a technical error, like not checking a “box” on the “smart worksheet”. I had a problem like that this week, and as I was on the software telephone queue for technical assistance I started showing Raquel what my issue was and what I knew the correct answer was. As I talked, clicked and demonstrated we worked through the software glitch and got the form to produce the desired result. I love working as team and find that working this way produces the least stress and best results. It’s great to have the option of explaining a problem and working through it as a team.
TAX ISSUES/TAX PLANNING
Last Minute Checklist (again):
- Connect with your CPA or professional tax preparer: a good adviser saves you more in tax savings, stress and aggravation than the professional fees they charge.
- Review your paperwork, both income and potential deductions: rushing your return out allows for the potential to file with incomplete information. This leads to potential penalties, notices and/or missed opportunities.
- Consider a direct investment in savings bonds via Form 8888 rather than requesting a tax refund
- Consider the benefits of a 2022 traditional IRA vs ROTH contribution short term vs long term, there is still time to contribute until April 18th 2023. Remember to inform your banker that this contribution is for 2022.
Reminder: April 18th 2023 Deadline for Estimated Federal Tax Payments
Individual tax payers remember that the payment for the first quarter of 2023 is due Tuesday, April 18th. If you are mailing in your payments make sure to get the envelope postmarked and put your social security number on the check. The 2023 Form 1040-ES, Estimated Tax for Individuals, can help you estimate your first quarterly tax payment.
Reminder: The Automatic 6-Month Extension to File is NOT an Extension of Time to Pay
If you’re unable to file your tax return by the April 18 deadline, file an extension which gives you until October 16th to file your 2023 tax return. Remember this is an extension of time to file, not an extension of time to pay! As they say the proof is in the pudding; the real challenge is calculating your balance due and finding the funds to make the required payment.
There is Still Time to Contribute to Your 2022 IRA
Reminder if you are planning to make a contribution to your 2022 traditional or ROTH IRA, you still have until April 18th as well. Please be sure to indicate the tax year as 2022 when submitting the documents and payment to your broker or banker. As always we recommend that you check with your accountant before submitting your paperwork to see if you are eligible and what the tax benefits would be.
FBAR Filing Deadline: April 15th
The IRS reminds US citizens, resident aliens, and any domestic legal entity that the deadline to file their annual Report of Foreign Bank and Financial Accounts (FBAR) is April 15. Lucky for us tax professionals this filing requirement is also able to be extended. Learn more about filing deadlines on the Financial Crimes Enforcement Network’s (FinCEN) website.
ECONOMY/BANKING
Fed Expected to Raise Rates in May
Amid the most recent economic data, analysts are trying to predict what it all means for interest rates in the coming months. Watch Yahoo Finance’s Jared Blikre and Seana Smith discuss what could be next here.
US Economy Added 236,000 jobs in March; Unemployment Rate fell to 3.5%
The US economy added 236,000 jobs in March, which is slightly lower than expected and a significant decrease from the previous months. While the job market is still strong, the lower numbers might prompt the Federal Reserve to slow down on interest rate hikes and avoid a potential recession.
Banks Lost Money on Mortgages for the First Time Since 2008
Banks lost money on each mortgage financed last year due to increased financing costs and decreased housing demand, marking the first negative profit in data going back to 2008, according to a report by the Mortgage Bankers Association.
House Committee Chair Concerned by Tesla Deals in China
The Chair of the US House of Representatives Committee on Oversight and Reform has expressed concern over Tesla’s deals in China, particularly with Chinese technology firms, citing national security risks. The Committee has requested documents from the company related to its operations in China and any agreements or partnerships with Chinese firms.
Consumers Feel Access to Credit is Getting Tougher
The Federal Reserve Bank of New York’s survey revealed that US consumers perceive credit access to be more difficult. The share of respondents reporting it’s harder to obtain credit than a year ago reached the highest level since the survey began in 2013.
Do You Need $1 Million to Retire
Current attitudes, especially among Millennials and Gen Z, suggest that you do. Watch Yahoo Finance Live break down the facts here.
GENERAL RESOURCES
- IRS resources for stimulus payments:
- Use the Get My Payment tool to check on EIP payment status
- Eligibility and general information about Economic Impact Payments
- A list of frequently asked questions for stimulus payments
- IRS information about the Advance Child Tax Credit Payments
- Portal to update information
- A list of frequently asked questions on the advance Child Tax Credit Payments
- The best source for up-to-date and accurate health information is the Center for Disease Control (CDC)
- Our prior blog posts, videos and prior weekly newsletters
- Entrepreneur put together a listing of free tech resources for remote work
- The Consumer Financial Protection Bureau has warnings about COVID-related scams
- The New York Times has an online newsletter on K-12 and higher education
- The Wall Street Journal has a collection of articles on education
- The Louvre has digitized 482,000 artworks from its collection
- How to create a strong password
We sincerely hope that you and your family are well and remain well. If you have any questions or concerns, don’t hesitate to reach out to us. We are here for you.
If you need help with your accounting, want to create a tax minimization plan, want to discuss your business growth plan or your finances, are concerned about retirement goals or need to be held accountable for your 90 day action plan, contact us for a complimentary discovery session or an appointment to just get started.
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