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: (805) 962-1040. We’ll invite you in and then walk you through whatever you need to do to remain compliant with the tax laws.
There are many moving parts when examining the tax law. The news media is helpful in providing small hints of what one can do to save tax dollars. Some people feel that if they get a refund at the end of the year, the made money. The people spreading this idea obviously could not pass a third-grade math test. The refund is not free money from the government it is your money has been taken each time you receive a pay check or pay and estimated tax payment.
The tax return is then prepared to determine the correct tax that you owe for the year. The correct amount is compared to the money that you paid in during the year to your account at the IRS. The difference between your money paid in and the correct amount then determines if you owe more money or get a refund. So in summary it’s YOUR MONEY paid in minus the CORRECT AMOUNT= tax due or refund.
When they change the tax withholding tables they raise or lower the withholding and thus gave everyone a higher or lower net take home pay. So now the whole year the taxpayer has to manage their money based upon the net take home pay.
The tables when adjusted leaves the whole year to enjoy more money and if you look on your paycheck pay stub you can see that weekly less Federal withholding occurred. The withholding tables are prepared based on average tax that someone would owe on that amount of income. If you have unique circumstances or a large mortgage or an outside business that is so far loosing money or spouse has a business that loses money then you can adjust your withholding about taken from your paycheck. You change the withholding if you meet certain criteria then go to the HR department to change the FORM W-4 that is on file with your employer.
Form 4852
Form 4852 serves as a substitute for Form W-2, Form W-2c, and Form 1099-R (original or corrected), and is completed by taxpayers or their representatives when:
- Their employer or payer does not give them a Form W-2 or Form 1099-R.
- An employer or payer has issued an incorrect Form W-2 or Form 1099-R.
You must take the following steps before filing Form 4852.
• Attempt to get your Form W-2, Form W-2c, or Form 1099-R (original or corrected) from your employer or payer before filing Form 4852. Contact the payor and keep in your possession the evidence that the employer or payee will not provide the correct form with accurate numbers included on the correct form. Sometimes there are good reasons why the payor cannot issue the form and sometimes there just refuse. This form is your remedy so that you can complete your return on time with accuracy.
• If you don’t receive the missing or corrected form from your employer or payer by the end of February then continue on by using the FORM 4852 after your earnest and valid attempt to get the information from your payor.
This form 4852 is used for you to give you a method to file your income tax return timely. You can use this form and file timely your tax return. Be sure that your calculations and information are accurate and complete.
Pension Plans
Your pension plan needs. Everyone reading this article has a need to properly plan for their retirement years. The worst part of life is when you retire then run out of money. Everyone knows to set money aside in a pension plan or use real estate purchases to be your retirement program. If we all were to buy one rental property every second year and we started when we were 30 years old then by 60 years old, we would own 15 rental properties. If each of these rental properties was a 4-unit apartment (fourplex) then we would own 60 rental units or rental rooms. With 60 rental rooms with no mortgage at age 65 you would have approximately $120,000 per month coming to your mail box. At age 65 $120,000 per month would be enough to keep you traveling the world in good style.
We find the hardest part of this retirement plan is to get started. As people for the most part have other priorities at age 30 and then they do not make plans to get their real estate investment portfolio underway.
For those that are behind in making wise investments there are other pension arrangements. A defined benefit program allowing you to put in more than $50,000 per year is available to self-employed people. Then IRA’S and Roth letting you put in more than $6,000 per year. Most people today are deciding to put money into their Roth account. Some of the people with wisdom are putting Roth money into retirement accounts for their children and grandchildren. Roth allows the money to grow and build inside the protected account, then when you withdraw at age 65 or older, all of the money, principal and investment earnings come out completely tax free.
At CANBERRA COMPANY we are champions in helping and motivating people in getting started with their investment program and then their retirement program. We have found ways to move the most stubborn people who want to put things off until next year. Financial planning of this kind needs a trained professional.
Warmly,
Steve Pybrum CEO
Canberra Company
(805) 962-1040
Canberra Company