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Wealth Health LLC Managing Director Rich Coppa on the fiscal cliff negotiations’ impact on American’s tax returns and refunds.
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They IRS issuing a new warning for taxpayers tonight -- this if congress doesn't get its act together.
100 million of us 100 million taxpayers out of -- 150 million total.
May be unable to either file their taxes or they will see their refunds delayed that's your money you're not getting back.
Rich -- -- managing director of wealth health financial planning is here with more.
What gives rich I mean look at what's happening is everyone's talking about tax rates and how much my rate -- next year but what they're missing is the point that the AMT.
Exempt amount has not been determined so that went away as of 2011.
And if it goes back to where it was years ago there's going to be almost thirty million more people subject to -- In addition to that they had the IRS -- people won't be able to file well the problem is that the IRS hasn't read.
Program their systems so be -- -- of their systems -- Right now the program to account for.
Inflation in the exemption continuing to increase as we have this past the last couple years but if they don't do that and it goes back to where it was.
The program's gonna have to be -- done more people are gonna be subject to anti tax.
And more people will not be able to file because of the system's not being completed so delay in refund.
Tell yet can I tell you how hard this is to take.
-- you know we have always unanswered questions about what's gonna happen with taxes right right and the idea.
That the government can hold my money back for me.
Because there are only intransigence and their own airs in their own problems and granted it's not the IRS it's really congress and the White House absolutely and you know it's it's -- -- linger.
Well makes you angry for for the person who wants to refund makes you angry as a practitioner because we can't give solid answers to our clients it makes you angry as a practitioner because it means.
We don't know what type of advice to give we're going to be working under deadlines in the shorter.
And it's tougher you know everyone in the business right.
Now this is really -- us all up they are just grinch who stole Christmas and they are immigrants that's right.
We wanna talk a little bit about -- -- I know people are really concerned right now about those taxes you say there are red flags.
Mistakes you do not want to make are you gonna get audited things that that will send you down that -- half first shot of course failing to win.
-- -- Yeah I mean under reporting hearing committee has been around forever meant something that you absolutely don't wanna do that thing that's different now as we move forward that -- computer programs have gotten better so there's.
A matching system so if you get a 1099 -- W two you better be reporting what's on it because they know they absolutely no and even if it's wrong if you think it's wrong what you need to do is go back to the source go back to the issuer the W to -- 1099 get a corrected one and make sure the corrected one gets into IRS otherwise.
You going to be on the phone like I was today if that's truly about -- -- another one you bring up here is if you really generous and you get up out a lot of charitable deductions.
Even if you do it legitimately could be in trouble.
Absolutely I mean look there's there's a lot of matching that's going on the systems as well as what I call -- proportionality so if you have these huge charitable deductions -- your income is small it's kind of -- red flag.
With charitable deductions you want to make sure you have documentation as we've always said but you also want to make sure that.
If it's over 500 dollars in total charitable deductions and file form 8283 need the list that out.
If the item your gifting is over 5000 dollars you absolutely need -- appraiser a qualified appraiser and have that appraisal and gets trickier and trickier got us talking about getting cars or whatever absolutely self employed.
The self employed you know that when I say that in reference in schedule C and your tax return because that's where.
Folks you know write off a lot of deductions inaccurate get a little bit messy because you know there's a blurred line between what's personal what's business and now like to be a little aggressive and take extra deductions but the fact is if its relative to meals and entertainment.
Travel car expenses document those things document what the purpose of the meeting once it was -- purpose of the meal.
Keep receipts over 75 dollars because if it again becomes egregious and you're taking more more deductions and income is looking small and small relative to the type of business type of industry they know this stuff.
Really they are they how hard you're and the strengths they are -- their money.
Of course hum -- always -- -- you gotta be careful -- that -- your last one is miscellaneous income what do you mean by that.
The miscellaneous income that that I'm talking about here.
Is what I'm thinking about our gains and to gain that is now sadistic attacks which may be at a higher rate as well as -- three point 8%.
Additional net investment income tax.
When you might find that before basis -- not reported what you paid for something.
You might find that he's you know you up the basis so that -- gain -- smaller by doing so you have less tax.
Do on the game because you have a higher -- you paid more so when you sold -- showing less income.
And that's what I think could be something now because there's new forms that are filed with the schedule.
49 which said you and remember the -- -- I think no one should -- The reality is you got a document what -- basis is and if the company.
Doesn't provide that to you you put in whatever you feel like but -- but you better have some.
Back up for.
ET FD morning film doesn't need my paperwork you need to be able to prove it are you -- music tracks are absolutely rich thanks for coming on and I thank you really appreciate -- throughout compact happy -- you to thank -- We'll be right.
