Announcer:
It’s time now on KROS for Financial Focus, brought to you by NelsonCorp Wealth Management. The opinions voiced in this show are for general information only and are not intended to provide specific advice or recommendations for any individual. Any indices mentioned are unmanaged and cannot be invested into directly. Registered representatives, securities offered through Cambridge Investment Research Incorporated, a broker dealer, member of FINRA, SIPC. Investment advisor representative, Cambridge Investment Research Advisors Incorporated. A registered investment advisor, Cambridge and NelsonCorp Wealth Management are not affiliated. Cambridge does not offer tax advice. Now, here’s today’s Financial Focus program.
Mike Steigerwald:
Good morning and welcome to this week’s Financial Focus. This is Mike Steigerwald, I’m filling in for Nate, and lucky enough to be joined by Andy Fergurson.
Andy Fergurson:
Can’t believe it.
Mike Steigerwald:
Our resident tax man. Enjoying the nice time of year post-tax season.
Andy Fergurson:
Ah, it’s beautiful.
Mike Steigerwald:
Grass is green. The sun is shining.
Andy Fergurson:
We’re working eight hours or less during the day. I get to go home, the sun’s still up. I can put my hands in the dirt. I can plant flowers or mow grass. Not that I like to do any of those things. Yeah, it’s great. The soccer season, track season. It’s interesting. I was telling somebody about track and soccer. In the spring season, there’s never good weather. It’s either hot or it’s freezing.
Mike Steigerwald:
But every day that goes past is a day closer to more consistent good weather, hopefully, right?
Andy Fergurson:
Yeah. Well, hot weather maybe.
Mike Steigerwald:
Yeah, yeah. We’re looking forward to the days where you’re not bundling up to go and coach or watch soccer. We played last weekend, and boy it was-
Andy Fergurson:
It was rough last weekend.
Mike Steigerwald:
It was like the fall out there. It was like November, it felt like.
Andy Fergurson:
Yeah. You’re getting a sunburn and a windburn and frostbite all at the same time.
Mike Steigerwald:
Yeah, fun stuff. Yeah, hopefully we get a nice turnaround. Again, nice to look outside and see the green grass.
Andy Fergurson:
Yeah, it’s great. And we’re getting to the end of the school year. All the fun stuff’s going to start happening. Baseball’s in full swing. Just all the vacations and all that stuff. Everything that you do that’s fun happens in the next couple of months, and then we’ll head back into the-
Mike Steigerwald:
Out of the darkness.
Andy Fergurson:
Yeah. It’s a great time. A great time of year.
Mike Steigerwald:
Awesome. Awesome. Well, because we have Andy here and it’s still fresh on everybody’s mind this time of year, tax season has wrapped up, sort of.
Andy Fergurson:
Kind of, yeah.
Mike Steigerwald:
But thought it’d be beneficial for our listeners to just get some tidbits from Andy about things that are still going to continue to happen tax-wise, even though the filing deadline has passed. There are plenty of people that are on extension. And then we also, some reminders about continuing to check your mailbox because this is the time for various letters and things to come from the IRS. If you can maybe just maybe expand-
Andy Fergurson:
Well, sure.
Mike Steigerwald:
… on that a little bit.
Andy Fergurson:
Yeah. I’d start with extensions. An extension grants you six extra months to file your taxes. It does not give you any extra time to pay your taxes. If you’re somebody who normally owes the IRS, it’s still better for you to get that return finished as soon as possible. Because if you owe them $1,000, they’re going to start charging you interest as of April 15th, regardless of when you file that return. It’s good to get it going. I was telling you this morning, I bet I have 50 returns that are on extension, and that’s a fair bit. It’s not so bad if we do them through the whole six months, but I’m fearing that I may be trying to do 40 of them in the last week of the extension season.
Mike Steigerwald:
Yeah.
Andy Fergurson:
That creates a different kind of problem. And what’ll happen, if you’re one of those 50 people and you wait until the last second, you run the risk of not getting your return filed on time. And if you don’t file on time, you pay a penalty. You could pay penalty, you could pay interest. I’ve yet to meet people that are excited about paying extra to the IRS.
Mike Steigerwald:
Right, right.
Andy Fergurson:
It’s like, let’s get it done. Take advantage of this slower time of year, get that information. If you’ve got something that you’re waiting on or that you know you’re going to have to go after, let’s say you’re looking for a document from Social Security or, I don’t know, from one of your pensions or something like that. If you’re waiting on a document and they’re telling you that they’re going to have to mail it and it’s going to take two weeks, well, let’s use the two weeks that are right now and let’s not wait until the last two weeks of the extension to go.
Mike Steigerwald:
Right, right.
Andy Fergurson:
Let’s get it done. Take advantage of it, and then you can enjoy your summer. And not only that, we can move into the next phase, which is really what we should be doing right now. And that’s planning, right? Did your return go the way that you wanted it to go? Did you get the benefits that you expected? Did you withhold enough? Should you be changing something?
Mike Steigerwald:
Yep.
Andy Fergurson:
Is something in your life changing? Do you have a kid that’s moving out or going to college? Or did you have a new baby? Or what are those things that are changing? Because it’s going to change your return. Did you get married? Did you get divorced? Did you change states? All those things matter. And now’s the time to plan for those things instead of waiting to see what happens to you at tax time and then reacting to it. Let’s get in front of it.
Mike Steigerwald:
Let’s implement those changes. To your point, have those conversations frequently about, “Oh, boy, I didn’t expect this.” Or, “I maybe owed a little bit more than I thought.” Or, “I thought my refund would be a little bit bigger.” Well, there are reasons why those things happen and there are ways to fix it, but the longer you wait to make the changes, the less impactful those changes will be.
Andy Fergurson:
Sure. Yeah. Think about if you’re changing withholding. I need to change my withholding because I owe $2,400 this year. Well, $2,400 is $200 a month. And we are a week away from starting the fifth month.
Mike Steigerwald:
Right.
Andy Fergurson:
Right? We’ve lost some time. Now our $200 a month is going to be $400 a month because we’ve cut our year in half. Definitely something to do at this time is to get into the planning and let’s look at it. What didn’t you like? What can we do better? What can we do different? Maybe it’s not better, maybe it’s just different. The other thing that I would say is now we go into this second season, and this is the time where we do amendments. This is the time where you’re going to get letters. If you haven’t had a chance to look over your return, look over your return. Is there something missing? Is there something that…
Did you forget that you put windows in, right? Because 2025 was the last year for windows. If you put windows in, you probably could have got three or $600 more, or paid three or $600 less. And if that’s the case, let’s do the amendment. Let’s get an amendment in there and get that window credit. Did you buy a new car in 2025 that had interest on it? Well, that was something we haven’t done before. Maybe that was something that will benefit you, and let’s look and see if there’s an amendment.
The other thing I would say is it’s going to be letter season, the letters will start to come out. There’s some pretty common ones that you shouldn’t be too worried about. Sometimes you’ll get a letter that says, “Hey, you got to verify your identity.” That’s a pretty simple thing. You call or you make your appointment to verify your identity and then they’ll process your return. Maybe they’re going to send you a letter that says they want some more information. Prove this document or tell me more about these expenses, or whatever. And everybody gets a little bit worried about those, but just do what they’re asking you to do. If they want more information, give them the information they’re asking for and then things will go back into process. But don’t wait. Don’t wait to respond. There’s so many times I see people who bury their head in the sand a little bit. They’re scared of what’s going to [inaudible 00:08:19] happen.
Mike Steigerwald:
Yep. Sure.
Andy Fergurson:
Well, what’s going to happen is going to happen. And so, let’s get it to happen. Right? It’s the old rip the bandaid off. We can do the slow burn and make it worse, or we can address it. Let’s get after it.
You may see refund issues. We’ve had some issues where maybe your bank account changed or you wanted to use a different bank account, or something like that. Well, this year the IRS… It used to be, if your bank account didn’t match the IRS would just send you a check. If the direct deposit kicked back, the IRS would then just… They’d wait a week or two and then they’d send you a paper check. And if you cashed the paper check, they considered it solved. But they’re not sending out paper checks now.
Mike Steigerwald:
So it’s going to require some activity from you.
Andy Fergurson:
Now you’re going to have to do something. You’re going to have to put some effort into it. If that letter comes and says, “Hey, we couldn’t deposit your refund because something was wrong,” well, now we got to make it right. And the way we’re going to make it right is we got to get online and go through the IRS and give them the correct information so they can deposit that return.
Mike Steigerwald:
We talked a little bit about this too, Andy, and just maybe if you could address this as well. I know we have the conversation about setting up an account on the IRS website-
Andy Fergurson:
Oh, my gosh, yes.
Mike Steigerwald:
… and how beneficial that can be. In particular, just absolutely for the access that it gives you in terms of the information that’s out there. But also, this is the time of year we do see some of those scams and fake letters that come out. And a good way to verify that is by having that account on IRS to know, did this really come from them or is this really them asking for this information?
Andy Fergurson:
Absolutely. Yeah, I would encourage everybody who has any capacity with their cell phone. If you know how to use your smartphone, meaning you can make a phone call, you can send a text, you should be able to do this. Now, I know there are people that struggle with those two aspects of a smartphone, but everybody else should go on and make an IRS account. Go through the steps to get your real ID, or your verified ID, and then you have access to the IRS and all of your information inside the IRS.
You can look at any notice they’ve sent you in the last four years. You can make payments, you can make payment plans, you can check the status of your refund. Here’s the one I love. You can give access to your accountant to all your information. Now your accountant can see your transcript, can see your tax records. Your accountant can view the letters and notices that you’re getting. I get people all the time who call me and say, “Hey, I got this letter from the IRS and I don’t know what it means.” I’m like, “Well, I need to see the letter.” Then I get the letter and it’s from the state of Illinois or it’s from Iowa, or it’s a simple letter that says, “Hey, we need a little bit more time to do something.” But they’ve lost two weeks of sleep waiting to get me the letter so that I can explain it to them. Whereas, if they had an IRS account, I could get on there and see it while I’m on the phone with them and say, “Hey, look, this is not a problem. Go enjoy your vacation.”
Mike Steigerwald:
Yeah. Certainly, valuable tools that are available to you. And I think it’s something that maybe a lot of people just aren’t really aware of.
Andy Fergurson:
Well, it’s fairly new.
Mike Steigerwald:
In terms of the sheer access, all of those things you just rattled off can be very, very important for anybody out there.
Andy Fergurson:
Yeah. And it’s fairly new. And when I go to my IRS trainings and conferences, they focus a lot on this IRS account. And what they say is we are going to put more and more and more access into this account. What that does, is if you can access that account, you’re going to get all that access. If you have an IRS account, your days of calling the IRS should be over. You should never have to call the IRS again. And what a dream that would be.
Mike Steigerwald:
That sounds wonderful.
Andy Fergurson:
I haven’t ever met anybody who’s had a good time calling the IRS and trying to get to an agent to get some information. It is a very good resource. And anybody who has any capacity on their cell phone should be able to do this. And I would encourage you to do it. And maybe you got to go to your kid’s house or your grandkids’ house and say, “Hey, help me do this.”
Mike Steigerwald:
It just takes one time, right?
Andy Fergurson:
Spend the 30 minutes. And it probably doesn’t even take 30 minutes. It’ll take 30 minutes if you’re not real comfortable creating an online account. But other than that, it’s probably 10 minutes to set up an account. But spend the 30 minutes to figure it out and get that access. Because, man, once you have that access, your life becomes-
Mike Steigerwald:
Unlocks a lot of things.
Andy Fergurson:
It’s like being able to access your bank account. Remember when we used to have to wait for paper statements? People may not remember that. I don’t know. Used to have to wait for paper statements. But now you can just, on your phone, you can tell exactly what’s going on in your bank account.
Mike Steigerwald:
Immediately. Yeah.
Andy Fergurson:
And that’s what we’re trying to do with the IRS, so don’t miss that opportunity.
Mike Steigerwald:
Good stuff. Well, that’s a lot of good info. Thanks, Andy. Before we do run out of time, I want to just mention that every month NelsonCorp is featuring a charity of the month. And the charity for this month is the Clinton Area Substance Abuse Council. Thanks a lot, Andy, for joining me and giving our listeners these tips for tax time, and you have a great rest of your week.
Announcer:
Financial Focus is a production of NelsonCorp Wealth Management in Clinton and Davenport. The opinions voiced in this show are for general information only and are not intended to provide specific advice or recommendations for any individual. Any indices mentioned are unmanaged and cannot be invested into directly. Registered representatives securities offered through Cambridge Investment Research Incorporated, a broker dealer, member of FINRA, SIPC. Investment advisor representative, Cambridge Investment Research Advisors Incorporated, a registered investment advisor. Cambridge and NelsonCorp Wealth Management are not affiliated. Cambridge does not offer tax advice. For more information, visit our website at www.nelsoncorp.com.