Oh my how I procrastinate!

The holidays got the best of me but here I am right on time because we all know, as soon as the ball drops, it's time to start getting those deductions and tax plans in order!

We had Free Money Part 1 and Free Money Part 2.  Here are the final two tips:

#10 - The best way to save tax dollars is to reduce your income before you pay taxes. So how about getting a miscellaneous fringe benefit from your employer instead of cash? Often an employee wants that green stuff that they often miss the bigger picture.

Not sure what I'm trying to say? Let me explain: You get your paycheck after paying all of your taxes or so to get to work every day you must ride a bus so you buy a pass for $120 dollars a month. Now instead of that let's have your employer give you a discount fare card up to $120 a month.  This is considered a de minimis fringe benefit plan (it's tax free) so not only do you get this for free but it does not show up as income so you are keeping more of your paycheck in your pocket.


#11 - Free Money isn’t always about what you can get for yourself but what you can give to someone else and in return you pay less in taxes therefore you put more money in your pocket. Gifts, Bequests and inheritances do not constitute taxable income but any money you earn from that money is taxable so one way to reduce those taxes is to give some of those earnings to a charity then that will reduce your income and your taxes. Sometimes to give you actual get and this is one of those times. This is also a great way for anyone that itemizes to reduce their taxes.  Just be sure you document what you're giving and if you are using an IRA or some other retirement account have them send the check directly to the organization then you avoid taxes on those distributions.

I do encourage you to always check with your tax planner to be sure you are keeping all or as much as you can of your hard earned money. 

Have a safe, happy new year, and I hope this helps you with reducing your taxes for 2009!

More Free Money Tips Part 2

Consider this my Christmas present to you! Picking up where we left off last time...

 - Group Life Insurance
Group term life insurance coverage $50000 or less provided to you by your employer is excludable from your income. You are not taxed on the cost of group term life insurance protection of more than $50000 if the coverage is provided after you have retired and are disabled, Your employer is the beneficiary of the policy for the entire period or the only beneficiary of the amount over $50000.00 is a qualified charitable organization for the entire period the insurance is in force during the tax year by naming a charitable organization as the beneficiary of the policy.

 - With the holidays coming how about making your employee really happy by giving them FREE MONEY that’s right I know too good to be true but you can give your employees a distribution that is excludable from their income if it is not of substantial value and is given for substantially non compensation reasons. So the IRS policy allows you to give each employee up to two non-cash gifts per year, tax-free, for a special occasion Gifts up to $500 per employee so think outside of the box cash isn’t everything and you can sure enjoy thing just as much as money especially when it is FREE.

Also think about setting up awards, be sure all employees can participate the IRS policy is the cost of the awards to $500, including taxes Awards up to $500 per employee.

- Which brings us to Employee Awards/ Achievement Awards

This exclusion applies to the value of any tangible personal property you give to an employee as an award for either length of service or safety achievement. The exclusion does not apply to awards of cash, cash equivalents, gift certificates, or other intangible property such as vacations, meals, lodging, tickets to theater or sporting events, stocks, bonds, and other securities. For this exclusion, treat the following individuals as employees: 

• A current employee.
• A former common-law employee you maintain coverage for in consideration of or based on an agreement relating to prior service as an employee.
• A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control.

In addition, the pay must meet both of the following tests.

Test 1. It must be reasonable.

• The duties performed by the employee.
• The volume of business handled.
• The character and amount of responsibility.
• The complexities of your business.
• The amount of time required.
• The cost of living in the locality.
• The ability and achievements of the individual employee performing the service.
• The pay compared with the gross and net income of the business, as well as with distributions to shareholders if the business is a corporation.
• Your policy regarding pay for all your employees.
• The history of pay for each employee.

Test 2. It must be for services performed.

• Achievement awards. .
• Length-of-service award. An award will qualify as a length-of-service award only
• Safety achievement award.

- EXPENSES of YOUR Employer
The IRS does not tax reimbursement expenses that are true reimbursements for expenses you paid on behalf of your employer. The IRS recognizes the impossible administrative verification problems in auditing such expenses. For whatever reasons, therefore, they are nontaxable. So here is an example let’s say your employer arranges for you to work from 11am to 7pm instead of 9 to 5 and your boss agrees to provide you with dinner money, these personal supper expenses therefore can be converted into nontaxable income. In effect, no matter what tax bracket you are in. you have arranged for the irs to buy you dinner.

Check back, I'll have the rest of the tips for you before Christmas hits!

Free Money - Part 1 of 16

Hope you all have been enjoying the Free Money tips I've been sharing on the radio!  In case you missed them, I'm going to be transcribing those great tidbits on here.  Let's kick this off with #1 - Hospitalization Premiums:

Hospitalization premiums paid by your employer are excludable from your income. For example if you normally would purchase hospitalization insurance costing $500 a year and you are in the 28% tax bracket, you would require pretax earnings of $694.44 in order to make that purchase. Which means you your have to earn $694.44, and 28% or 194.44 would go to your taxes. In other words having your employer pay your hospitalization premium in the case $500 for you would be saving 194.44.

Now that’s FREE MONEY

Check back soon, we'll have the rest of them up before the holidays so you can settle your tax prep with ease!

Quick update

It's been quite the whirlwind in the past couple of months - finishing up business tax filing back in September where my clients had originally filed for extensions in April and same for the ones I help file personal taxes (deadline October 15th).  Luckily WilliamsX3 is efficient and quick (precise) turnaround is easy peasy.

Both radio shows are going really well, Hank and I have been getting a lot of good response on the Financial Lifestyle Show.  And hey, if you haven't caught the live episodes you can find the podcasts here.  

I stumbled upon a lovely site called Design*Sponge where they feature a women's business (Biz Ladies, if you will) segment each week.  It's really wonderful stuff, great tips for entrepreneurs and creative types and even though it's geared towards us girls, I really think it's worth checking out regardless of which gender you are.  The topic I chose to weigh in on was on Tax Info for Small Business.  Highly recommend it.

This November, I start a series on WLAC News Radio 1510AM.  It's called "Free Money" and I know you're going to like what I have to share.  Just a sneak peek for now, I'll be giving you some tips on how you can get some free $$ when it comes to selling your home, work expenses, hospitalization premiums, and separations/divorces.  You're not going to want to miss this.

Check back soon, I'll have the first installment of Free Money for you. Cop ya later!

Taxes - it's not just for the rich.

People who are for tax think that the death tax is a great source of revenue for the government because this tax allegedly applies only to the rich.  Inheritance or money passed from one party to another - proponents of raising taxes say this money should be taxed, just like income or taxable gifts.


But what is inheritance tax? Why is there a tax on death? And how does this "death tax" work?


The inheritance tax rate depends primarily on the type of property being inherited and the relationship of the heir to the deceased.  For example, when Mr. Smith dies, he leaves his mansion and fortune to his children, his fancy car collection to his brother Ralph and his yacht to his old fishing buddy Terence.  Usually, each child must pay taxes on what he or she inherits.  That's what we already know about inheritance.


Ralph must also pay taxes on the car collection.  He will probably be taxed at a higher rate than Mr. Smith's children because he is neither a child nor parent of the deceased.  Non-lineal heirs are generally subject to higher inheritance taxes.  Since Terence is not at all related to Mr. Smith, he will be subject to the highest taxes.


Just because you inherit money doesn’t mean you’re rich but it does mean the government could take almost half of your inheritance.  They say they are taxing the rich, but they are really taxing everyone. The government saw a chance to get their hands on your family's dynasty, they are taxing your inheritance because they feel you are getting more than you need.  That’s right, rich or poor they really do not care - it’s all about how much money they can get so they can keep spending. 

Tell me, what is your opinion on the inheritance tax?

Tax planning seminar

I'm real excited about tomorrow - my co-host on both the Retirement Report and the Financial Lifestyle Show, Hank Parrott and I are holding a free financial planning seminar and so far the response has been great. We have 70 people signed up, and here's hoping we can turn this into new clients and new people we can get to know and help.

Mum and dad are coming to help set up and I think dad's going back to the office but good ol' Gigi and I, we're a team and I think she'll be sticking around for moral support.

We're going to be discussing the pros and cons of the services provided by Brokers vs. RIA's, and for my part, a Tax Preparer vs. a Tax Planner. I am the latter, and I cannot stress enough how different both are. Yes, we work with your taxes and we're super busy in the months of March and April. However, a tax preparer is someone who just puts the right numbers in the right columns and boxes so you don't get in trouble with the IRS when you file your taxes.

Tax planners like myself, well, we do much more than that. I try to get to know my clients and their objectives, whether it's personal or with their business. Like I always say, I'm here to maximize your income and minimize your taxes. I will help make objective decision in your best interest, come up with ideas and I work with you in mind. At the end of the day, you're happy and I'm happy. And that's what matters.

Mommy and Me

Author Linda Gordon and Susan Shaffer wrote the book Too Close for Comfort? Questioning the Intimacy of Today's New Mother-Daughter Relationship.

They were interviewed this week in the Life section of the Tennessean, and according to the article their viewpoint is that a mother cannot be a friend to her daughter and vice versa. In fact it goes as far as to say that a mother can undercut the daughters self esteem. Even though I can only speak of my own relationship with my mother I do think that is just baloney.

Why would a mother that gave you life or, in my case, build my self esteem by believing in me and educating me want to undercut all of those years of work? Gordon says in the article,

"They're struggling with how to be a loving, generous mother and "Where do I draw the line between letting her be her own person?" There is one type of mother that is also too dependent on her daughter. The daughter really starts to feel guilty and feels like she's carrying Mom on her back."

How many of us haven't had to struggle saying yes or no to our platonic friends? One must wonder if these ladies have any sort of relationship with their mothers. They also say that any relationship between two women of different ages cannot be equal because they are not at the same point of life. Again, I call baloney. What they are missing is that throughout time women have learned from each other and who better to ask than someone who has been already there? My life and my mother’s life might be completely different - she chose marriage and children over career, I choose career over family. But it doesn't mean we haven't had any similar experiences in our lives.

This article is mostly about daughters that are too lazy to do things for themselves and mothers that will do anything for their child. In the real world if a mother and daughter are to work, live and play together they need respect, trust and most of all they need to be able to talk and to build dreams together. That is what a true mother and daughter friendship is all about.

I would love to hear your thoughts on this!