Get ready to navigate the complexities of tax season with confidence as we bring CPA extraordinaire Ms. Jody Buckner into the Money Matters fold. This episode is a must-listen for anyone looking to avoid common pitfalls and make the most of their tax returns. We're not just talking about crunching numbers; we delve into the art of timing your filings, organizing your financial life like a pro, and the savvy moves that can enhance your financial well-being throughout the year. With Jody's expert guidance, you'll understand why sometimes a big refund isn't the win you might think it is and how adjusting your withholdings could be the smarter play.
When it's time to tackle those tax forms, do you find yourself swimming in a sea of receipts and regulations? Fear not, our discussion with Jody Buckner is your lifeline. She shares the secrets of a stress-free tax season with year-round strategies that go beyond the typical shoebox of receipts. We're talking about the power of digital organization and the overlooked credits that could be game-changers for your finances. Plus, we get into the nitty-gritty of whether to itemize or not to itemize—that is the question we answer, along with a peek into investment strategies that could defer your tax liabilities.
For the entrepreneurial spirits and small business owners tuning in, we've tailored this episode with your unique challenges in mind. Jody's tips on meticulous tracking and staying current with tax law changes are invaluable. We demystify the IRS, transform audit anxieties into audit preparedness, and underscore the peace of mind that comes from a strong CPA relationship. From choosing the right filing status to strategizing your deductions, this episode equips you with the tools to keep your finances flourishing. So, join us as we turn what could be your most dreaded time of the year into an opportunity for financial optimization.
Welcome to Money Matters, the podcast that focuses on how to use the money you have, make the money you need and save the money you want – brought to you by Neighbors Federal Credit Union.
The information, opinions, and recommendations presented in this Podcast are for general information only and any reliance on the information provided in this Podcast is done at your own risk. This Podcast should not be considered professional advice.
Get ready to navigate the complexities of tax season with confidence as we bring CPA extraordinaire Ms. Jody Buckner into the Money Matters fold. This episode is a must-listen for anyone looking to avoid common pitfalls and make the most of their tax returns. We're not just talking about crunching numbers; we delve into the art of timing your filings, organizing your financial life like a pro, and the savvy moves that can enhance your financial well-being throughout the year. With Jody's expert guidance, you'll understand why sometimes a big refund isn't the win you might think it is and how adjusting your withholdings could be the smarter play.
When it's time to tackle those tax forms, do you find yourself swimming in a sea of receipts and regulations? Fear not, our discussion with Jody Buckner is your lifeline. She shares the secrets of a stress-free tax season with year-round strategies that go beyond the typical shoebox of receipts. We're talking about the power of digital organization and the overlooked credits that could be game-changers for your finances. Plus, we get into the nitty-gritty of whether to itemize or not to itemize—that is the question we answer, along with a peek into investment strategies that could defer your tax liabilities.
For the entrepreneurial spirits and small business owners tuning in, we've tailored this episode with your unique challenges in mind. Jody's tips on meticulous tracking and staying current with tax law changes are invaluable. We demystify the IRS, transform audit anxieties into audit preparedness, and underscore the peace of mind that comes from a strong CPA relationship. From choosing the right filing status to strategizing your deductions, this episode equips you with the tools to keep your finances flourishing. So, join us as we turn what could be your most dreaded time of the year into an opportunity for financial optimization.
Welcome to Money Matters, the podcast that focuses on how to use the money you have, make the money you need and save the money you want – brought to you by Neighbors Federal Credit Union.
The information, opinions, and recommendations presented in this Podcast are for general information only and any reliance on the information provided in this Podcast is done at your own risk. This Podcast should not be considered professional advice.
Welcome to Money Matters, the podcast that focuses on how to use the money you have make the money you need and save the money you want.
Speaker 2:Now, here is your host, Ms Kim.
Speaker 1:Chapman, welcome to another edition of Money Matters. I am your host, kim Chapman. It's tax season, so what else are we going to talk about? Taxes, get ready to embark on a journey through the basics of tax filing and preparation. And, of course, we're going to be talking to a CPA, because that is most definitely not my area of expertise. So joining me today is CPA Ms Jody Buckner. Welcome, and thank you so much for coming and joining me today. Well, thank, you.
Speaker 2:I'm glad to be here.
Speaker 1:So, to get started, tell us first of all I hate when people do acronyms like I'm doing. Let's talk about what does CPA stand for, and then tell us a little bit about your professional background.
Speaker 2:All right, so CPA certified public accountant. I am a CPA from 1997, I believe, went to LSU, graduated and started working in a local CPA firm. I passed the CPA exam after studying for a long time and I've worked now for about 30 years as a CFO for two different companies locally and I have a side CPA practice.
Speaker 1:So a numbers person, I have to say, and of course we know each other. We work through, we partner together through Jumpstar, which is definitely a passion. We both share financial literacy. So let's dive right in. What are some factors individuals should consider when determining the optimal time to file their taxes? Because, of course, by the time this airs, we'll be thick into taxis and I know some people go straight for the juggler, especially if they're getting a refund. I think those are going to be the ones that do it a little bit earlier, People that typically, oh, want to wait until the end, but what do you say?
Speaker 2:I say don't do your taxes too early, because maybe you don't have all your paperwork. So you're supposed to have your W-2 by January 31st, but maybe there are some other forms that aren't due till the end of February and so you don't have all your things. Get all your paperwork together, Get your taxes prepared. You don't have to pay. So you don't have to pay until April 15th. So you don't have to pay, even though you've already got it prepared.
Speaker 1:So I don't know. So you mean that I can file my taxes now and wait until that date? If I owe to send that check, that's right. I think it would haunt me the entire time. All right, so, as a CPA, what are some common mistakes you see people make when preparing their taxes and how can they avoid them?
Speaker 2:So I would say number one is just like what I just said you don't have all your paperwork yet. So people want to get that W-2, they want to go ahead and file their taxes and the next thing you know, they're calling me up and say, oh, I got this in the mail. Did I need this? Yes, you needed it. So be patient, you know. Make sure you have everything you need. Another common mistake is they gave me the wrong bank account number. They didn't know the right routing number, and so I file their taxes. They're supposed to get a refund and guess what? The banking information was wrong. The other things maybe you didn't take the credits that were due you. You're trying to do it yourself. You didn't know about this credit. So those are the kind of mistakes I see most often.
Speaker 1:All right. So what are some of the advantages of working with a CPA compared to, you know, just your standard tax preparer, even just doing self-wear, doing it at home?
Speaker 2:CPAs are tax planners. I call us Like. We are always looking at you, you know what do you do, what are you active in, or you maximizing your deductions? We have to stay up to date on tax laws. Cpa society requires us to take 40 hours of continuing education every year, so we tend to stay up to date more on what's going on.
Speaker 1:All right, so can you share some strategies for maximizing deductions and credits, to optimize refunds or minimize preparation process?
Speaker 2:So I get this question a lot and my number one thing is talk to your CPA, tell us about your life. We need to know your marital status, your children, things you may be involved in financially. We need to get to know you. Do you invest? Do you own a home? Do you have medical and dental bills More than just your normal checkups? Do you give to charities? Those are all things that you have to talk to your CPA.
Speaker 1:And so if I wanted to schedule an appointment to see a CPA, what sort of thing should I make sure I bring in hand? And, ideally, if it's not over complicated, how long should I expect to spend with a CPA?
Speaker 2:Generally, if you're just coming to get your taxes done or if you just want to come talk to us in general, out of season, you need to bring all the forms you've gotten in the mail. Bring anything that do you have a business and that's going to require a lot more. Just come talk to us. I say not during tax season, just say hey, I'm interested in getting a CPA. It's June, call me, come, sit down, let's have a talk, let's discuss your situation.
Speaker 1:And I imagine it's a lot better than April when everybody's looking at oh my God, it's time to file those taxes.
Speaker 2:Right, don't call me and say I just want to come talk to you on April 10th.
Speaker 1:Now I see this a lot, of course, in my industry in terms of financial counseling. We'll see individuals that have large refunds that I often use the quote saying that's basically an overpayment to the government. So what are some advantages and disadvantages of receiving a large tax refund versus adjusting your withholding and receiving more money throughout the year?
Speaker 2:I call this a saver versus a spender question. I tell people, if you are a spender, it's probably better to get a refund. It's because it's kind of a little savings account for you. That's not ideal, because you're letting the government use your money but at the same time, if you're a spender, that little refund is going to help you at that point. Now, if you're a saver, yes, change your withholding, get your money throughout the year, because you're going to save your money anyway. But if you're a spender, you need a refund.
Speaker 1:Yeah, we find that a lot, that sometimes people get that one check and that's their advantage to be able to throw money in savings, maybe take care of some debt. But then, of course, on the other spectrum, they find it, maybe they waste it and then they're struggling throughout the year. So that's always kind of a I know it's definitely an individual question, but something that I talk about a lot, definitely in my office. So that's for the people with refunds. Let's talk about the people that owe. What are the most common reasons individuals find themselves owing taxes after filing their tax return?
Speaker 2:Generally it is because their withholding is wrong on their paycheck. I mean, the W-4 form changed a number of years ago and it's much more difficult to fill out now.
Speaker 1:Used to you.
Speaker 2:Check single or married and you put how many you wanted to claim. Now it's like through this whole process. So I tell people, when you change jobs, when you fill out a new W-4, look at that first paycheck and go to your human resources department and say does this look right to you? Because in my current job I'll notice on people's paychecks oh no, you're not having enough withholding. I can tell. So make sure you check with your human resources department.
Speaker 1:So you mentioned you said that form changed a couple years ago. So if I've been at my job like I have been, seems like forever in a day. Should I go back and review my W-4 form?
Speaker 2:You probably shouldn't, unless when you file your taxes, your owe and money, or you're getting a large refund, then you can discuss what you should be claiming Because in your situations change, our children grow up, you don't have a dependent anymore, that type of thing.
Speaker 1:Well, it comes soon when we can add those animals and pets on our taxes, because I tell you, not only do I see it as a big part of my budget, I see it as a big part of individual budgets as well. I tell you, that would make life easier. How can individuals effectively organize their financial records throughout the year? To streamline this process? I know you mentioned come in with that paperwork. Come in with that paperwork, but tell us a little bit about what that paperwork looks like and you know what's the best way to organize throughout the year so that it's not such a stressful time come March and April.
Speaker 2:Yeah, so get yourself a filing system. I recommend just an accordion so you can file your receipts, just put them in alphabetical order and then type them up at the end of the year. If that's overwhelming, then every month go through what you had for the year. I have an in-home daycare that fills out forms monthly for her expenses and then totals them at the end of the year. A filing system is key. Keep your receipts and, of course, nowadays there are a lot of apps where you can scan your receipts and it files them for you.
Speaker 1:So there's a lot of options. That's definitely helpful, because receipts are not created equal and I tell you some receipts. You buy something on Monday and you don't know what it says on Tuesday. All right, all right. So what role does tax planning play in getting the most out of tax preparation, and how far in advance should an individual start planning?
Speaker 2:So I say stay prepared all year. It's much less overwhelming. Ask your CPA during the year. We love tax questions outside of tax season.
Speaker 1:That's good to know. I would think you'd be resting. Stay away, because you know. When does tax season typically really start to ramp up? Is it after January 3rd, 31st, once the W2s are released?
Speaker 2:Well, we're busy in January because 1099s have to be prepared for companies and that kind of thing.
Speaker 1:So yeah, January 1st is we hit the floor running and is it crash and burn after April 15th? Yeah, after April 15th.
Speaker 2:We need a few weeks off.
Speaker 1:Time for rest and relaxation. All CPAs are in the Bahamas, all right. Are there any specific tax saving opportunities or strategies that people commonly overlook?
Speaker 2:Don't forget the education credit. If you have a child in college, please take the credit.
Speaker 1:Or two or three.
Speaker 2:Yeah, child care credit. People forget about that one. If you pay in child care, make sure you tell your CPA. There's also a retirement savings credit for people. If you're self-preparing a lot of time people skip that. Most people know about the earned income credit. So I would say education credit is probably the number one I see skip most, but retirement savings credit that's a big one I see too. So people need to remember. If you're putting in a retirement account, make sure you tell someone.
Speaker 1:Okay, how can individuals take advantage of recent changes in tax laws or regulations to optimize their tax situation?
Speaker 2:So there really hasn't been any big changes lately, but be sure to ask your CPA if you have any specific questions about that.
Speaker 1:So here's the big question To itemize or not to itemize. So what should a tax preparer consider when deciding whether they want to go ahead and itemize their deductions or just take that standard deduction? A standard sounds easy, but is there really an advantage one over the other?
Speaker 2:So I always tell people to track your itemized deductions Because if it adds up to more than the standard deduction, you definitely want to use it. You always want to use the higher deduction. People are afraid if they itemize, the IRS is going to look at it. People always talk about that and this is not true. Unless it's excessive, the IRS is not that scary.
Speaker 1:That's what you say, right.
Speaker 2:Just make sure what you're reporting is correct. I mean, that's what the IRS really wants to know, right? Like yes, you gave to this charity, yes, you paid your property taxes, your state taxes. Like that's your itemized deduction, so make sure you just keep up with that.
Speaker 1:So maybe what are some of the most common things that are itemized itemized, if I can say that right and then what are maybe some of the most unusual things you've seen become itemized deductions?
Speaker 2:Well, your standard itemized deductions are your taxes, your state taxes, your property taxes. Then you have your contributions. I mean, it's basic things, it's interest on a mortgage, right. Those are probably the four most common. So if you don't own a home, if you're not a big charitable person, then you're probably not going to itemize Unusual. Let me think, do I have anything? I don't really. I think there's a lot of unusual things that you truly can atomize.
Speaker 1:Okay, just never know. You always hear certain little things. Of course, when somebody's working from home, of course they want to be able to deduct the electric bill and even the sofa that they're sitting on in terms of work furniture, so I was just curious about that. So can you explain the benefits of tax efficient investment strategies and how they tie into tax preparation?
Speaker 2:So this is a big topic and people have varying ideas on this. I tend to like deferring taxes as long as possible. If I have the option to put money in a 401k, I am definitely taking advantage of that and I'm doing it with a tax deferred option. I always encourage everyone to enroll in this if they have the option. Most companies match some part of that contribution and that's an automatic return, and people they're so worried about putting money because they don't think they have enough, but I promise you, if you put $20 a week into this 401k, your company is going to give you some part of that more than likely, so please take advantage of that. There are other options to invest in, like Roth IRAs, that are not tax deferred, so it's an individual choice.
Speaker 1:Definitely, and I think those are something that's often overlooked and people don't realize, like you said, that $20, especially if you start when you are young and it just adds up over time, because time is what really really makes that difference, not so much how much you put in, but that time All right. So, of course, for self-employed individuals or small business owners, what are some key tax planning that they should implement?
Speaker 2:Track everything, whether you think it's deductible or not. Record it and then add your CPA. Never over extend yourself to get a tax deduction, but if you can pay it early to get a write-off, I encourage you to do so. Bonus depreciation is a hot topic. It went down to 80% in 2023. The Senate is still debating this. It could still go back up to 100% for 2023, which is an odd thing. But make sure that you track everything.
Speaker 1:So I imagine the average listening probably has a simple tax form that they have to fill out, but of course there are some that are going to be complicated and I imagine that's why CPAs actually exist to be able to do that. So how can individuals navigate complex tax situations such as multiple sources of income, investment properties or international tax obligations? Just saying all that sounds scary and complicated.
Speaker 2:Right and it's really not as complicated. I think people are just so concerned about the IRS. It's like the big tax man's coming because you see these stories on TV or you see these advertisements. It's really not as scary as you think, but prepare in advance. Ask your CPA for help in tax planning. I promise you. If you come to my office and you say, jody, I'm starting this business, what should I do? I'm going to give you some really good advice to sit here and say you're going to keep organized and get everything done and it's not as scary as it sounds.
Speaker 1:It's amazing how that little three-letter acronym just kind of has that common feeling when people hear it IRS and so, of course, because they don't want to get audited. So what are some common red flags that can trigger and audit, and how can taxpayers minimize their risk of being audited? We want to stay under the radar. We don't want to hear their name. We want to stay clear of them. So how can we stay on our best behavior?
Speaker 2:So it's usually simple mistakes that cause letters to come in the mail Math errors, keying in the items wrong these don't cause audits. You're just going to simply get a letter in the mail and they're going to want you to reply. People really get upset when they get a letter from the IRS, but they just want to reply. So audits usually come when letters are not answered. You're just ignoring it because you're scared to death. It's an IRS letter, of course, or someone's taking extremely high deductions. If you are taking really high deductions compared to others in your income tax bracket, that's when a red flag comes up to the IRS. The IRS is really not that scary. They're short staff so they're hard to get in touch with, which makes people even more nervous, but I promise you it's not as scary as you think.
Speaker 1:That's a promise I'm going to hold you to if I ever get audited, all right. So what resources or tools do you recommend for individuals looking to educate themselves about tax preparation and tax planning, so that we can all feel a little bit better about the IRS?
Speaker 2:So I don't have a lot of go-to places besides your CPA. But most of your local libraries, a lot of your banks and credit unions hold seminars all the time on different strategies. Sign up for their emails, attend their meetings. They would love to have you. You can just google just about anything these days. So if you're just curious and want some fun reading I mean, I know everybody likes to read about taxes- Especially if you have insomnia, right?
Speaker 1:All right, so you mentioned, of course, tax laws are forever changing, so how can tax preparers or taxpayers stay informed about changes in tax laws and regulations that may affect their situation?
Speaker 2:So before you bring in your tax information, you can call your CPA's office ask is there anything new that I should be aware of? If you're a client a lot of times, the CPA probably knows you. They're going to contact you during the year and say, hey, did you know this changed, so we need you to bring something different.
Speaker 1:Okay, and then finally, what advice do you give individuals who want to ensure they're getting the most out of their tax preparation experience? You hear these commercials all the time come over here, come over there. We're going to make sure we double your refund, we'll make sure we get you more. What can they do to make sure that they're really getting the most bang out of their taxes?
Speaker 2:I say shop around for a great CPA. We're a great group. If I can help you, I will glad you to send you to one of my CPA friends who will help you. So just pay attention, don't always fall for the gimmick that you say.
Speaker 1:Yes, and there are a lot of gimmick. So, of course, if our listeners want to be able to reach out to you, because you make it seem so easy, you're calming our fears for the IRS and it seems like it's more of a relationship that you know, because I kind of think of a CPA, almost like the dentist not that they're all, for they're doing a good service for us, but it's taxes. So if they want to be able to reach out to you, jodi, get some more information, develop that relationship, come and make sure that they're getting the most out of their taxes. How can you be reached?
Speaker 2:So you can email me at jodi with an ibuckner at yahoocom or call me 225-287-9617. Also, let me give you a brief plug. I work at Lyon specialty. I'm the CFO there. We're a wholesale distributor to convenience stores and restaurants from the CFO. If you know of a convenience store or restaurant looking for a supplier, give me a call for that too.
Speaker 1:There you go. Well, thank you so much for joining us. I definitely hope you've been lighting our listeners, that the takeaway will be prepare all year long, come and see you in the off season and stop fearing the IRS. I think I got that straight. I'm definitely holding her to that in terms, if I ever get that letter in the mail. But thank you so much for joining us. Oh, thank you.
Speaker 2:Kim, appreciate you having me on.
Speaker 1:Determining whether you itemize deductions or take standard deduction can significantly impact your tax liability. Here are a couple of tips to help you decide which option is going to be best for you. First, calculate your potential itemized deductions. Start by gathering information on deductible expenses, such as your mortgage interest, property taxes, state and local taxes, medical expenses, things like that, and see which one adds up to be more for you. Consider changes in the tax laws. Tax laws can change annually. Make sure you're up to date on that information to help you make that decision. And then, of course, evaluate your filing status. Your filing status could be single, married filing jointly, met filing separate, married filing separately, or head of household. Choose the filing status that maximizes your tax benefits. And finally, check out neighbors fcuorg for slash financial education to learn more on how to use the money you have, make the money you need and save the money.