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 representative, securities offered through Cambridge Investment Research Incorporated, a broker-dealer, member 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.
Nate Kreinbrink:
Good morning and welcome to this week’s Financial Focus brought to you each and every Wednesday morning right here on KROS. Well, this is Nate Kreinbrink joined this morning by Mike Van Zuiden, NelsonCorp Tax Solutions. It’s been a few weeks since you’ve been on last, Mike, so I appreciate the trek around the detour, up the hill this morning to join me.
Mike VanZuiden:
My pleasure.
Nate Kreinbrink:
It’s always fun looking out and seeing the progress, or so-called progress, I guess you could say, out front, but it’s coming along and hopefully before too long, we’ll have the full access to our office again, off of 13th Avenue north with the work they’re doing there, but again, hard to believe, mid-July, things are rolling right along. I know 4th of July weekend, it’s been a good one, warm one. We were talking a little rain coming and for the yards, I think that is much welcome, I think.
Mike VanZuiden:
Absolutely. Absolutely.
Nate Kreinbrink:
Not that I want to sit there and continue to mow every week again, but as I was saying, it’s not quite as soft. It’s a little crunchy and crispy out there in the mornings, but anyways, it’s moving along. We’ll get it and all will be well. But again, obviously with Mike here with NelsonCorp Tax Solutions, probably a lot of topics we could be going over today from taxes, but there’s a few of them that you and I were kind of talking with ahead of the show that you kind of want to hit a little bit and want to make sure we get to a few of those. The first one is the IRS backlog. And I know this is kind of, Andy mentioned it briefly last week, but again, with some of these filings and some of the returns that you’re getting from the IRS, they are a little backed up and obviously with everything going on from their world, they are a little backed up. So people just need to be patient, correct?
Mike VanZuiden:
Absolutely. Going into this previous tax season, because of COVID last year, the IRS had a significant backlog of unopened mail in front of them. So amendments and things like that that get mailed in, payments that get mailed in. They were backed up before we even started this tax season. And what we’re seeing now is that has carried over. We have clients that have filed returns, had returns e-filed and accepted in March that are still waiting for refunds to hit their account. Getting a lot of phone calls related to questions like that. The process is just taking a long time. And really as a tax preparer, short of going on and checking the status of the refund, there’s not a lot of recourse at this point, as far as we don’t have any control or influence over speeding that up. We can look at has it been accepted? And beyond that, it’s just a difficult process right now.
Mike VanZuiden:
Not only are they moving slowly, trying to make phone calls to the IRS and actually get somebody to answer the phone and give you answers, it’s not happening right now. And it’s frustrating for a lot of people.
Nate Kreinbrink:
Right.
Mike VanZuiden:
Including us as tax preparers. But once we send that return on its way and it gets accepted by the IRS, they process at their pace. We really don’t have a lot of influence once that happens. So that’s frustrating for people that are waiting for their refunds.
Nate Kreinbrink:
Right. And you can kind of see this trend coming a little bit as the year started and everything. I mean, you had the stimulus payments and them trying to figure out all the payments of all that stuff, you had recently the child tax credit and how that’s going to all fit in, the tax extension of a month to May 17th this year, then people with unemployment credits and that thing that’s going on their return, trying to file amendments then at that point in time. Businesses and the loans and their forgiveness and all that that’s kind of coming into it. It’s kind of been a log jam that, again, although you were hoping that it was going to go smoothly, it’s not out of the question as to why this is kind of where they’re at, correct?
Mike VanZuiden:
I mean, I guess there’s reasons for it. Does that make the wait any easier, things like that? Absolutely not, but there has been a lot going on, and there continues to be. You mentioned the child tax credit, that process is in motion now.
Nate Kreinbrink:
Right.
Mike VanZuiden:
So those payments will start coming the middle of this month. Folks that are interested in opting out of that and rather than taking the money throughout the year, just saving the entirety of that credit until they file their taxes next year, which has been the norm. The ability to opt out of that is now available through the IRS website. It does require that the taxpayer goes on and creates basically a log in account and then goes through some information there in order to opt out of the advanced payments of the child tax credit. So yeah, there’s a lot going on and it lends itself to some changes come next tax season.
Nate Kreinbrink:
Obviously.
Mike VanZuiden:
Sp next tax season, I see us reconciling a third stimulus payment that happened this past year. There will be reconciling what you did and didn’t receive as the child tax credits. So with change comes opportunity, I guess. And I see a lot of opportunities in the future as it relates to those things.
Nate Kreinbrink:
Well, and I think, again, looking at that child tax credit. I mean, I did my research and kind of went on there personally and looked around a little bit and as far as the process that it takes to un-enroll from receiving that child tax credit early, and it is a process, I mean, you have to physically un-enroll in order to not get that and defer it to your tax return like you normally would. And also again, a married couple that has kids, each spouse needs to go on individually and un-enroll as well, otherwise only half of that credit would be un-enrolled for, the other half from the spouse that didn’t go on and physically un-enroll would still be paid out at that time.
Nate Kreinbrink:
So it’s kind of an unknown system. And again, we continue to get questions from individuals that have children that they fall into this to say, “Do I need to do it? What do I need to do? How’s it going to impact me? Is this additional money? Is this whatever?” There’s a lot of questions that continue to come into it. And again, as we kind of mentioned last week with Andy, and then James when we were on there a few weeks ago, again, it’s not any additional free money that individuals are getting. It’s just a prepayment of that credit that they would have already have gotten should they have just deferred it all to their tax returns.
Mike VanZuiden:
Right. Absolutely. And I think if there are people out there that are unsure about how it impacts them, I would encourage them to contact your tax professional, whether it’s us or someone else. And just ask those questions now, rather than just kind of let things play out and you might come to the time next spring when you’re filing your tax return. “Well, normally I get a $5,000 refund. Where’s it at?” Well, you got a good share of it up front.
Nate Kreinbrink:
You had it prepaid to you.
Mike VanZuiden:
So yeah, it’s basically been prepaid. And the information is out there, go seek it, seek it out, ask the questions that you need to so you don’t get, the surprise in the spring may not be a positive one. So as much information as you can gather now and make those decisions up front the better off.
Nate Kreinbrink:
And I think it all goes down to what we preach all the time. And that’s just continuous planning. And I know Andy says it all the time. You say it all the time. As far as this time of the year is the perfect time to sit down with couples as far as looking at, “Okay, this is what happened last year in taxes. This is what we’re looking at again if we stay status quo for next year.” It’s still early July. We still have pretty much half of the year leftover in order to make any changes from a planning standpoint to help their situation. And I know you and Andy and then TJ and Hannah and everybody down at that end, there’s a little bit more of a smile on your faces this time of year, as opposed to you get to April-ish and deadlines are quickly approaching. So the planning time is now.
Mike VanZuiden:
Absolutely.
Nate Kreinbrink:
And then I guess that’s what I’m trying to get to with you guys. And as far as any of this comes into it, that’s what you like to sit down with people now.
Mike VanZuiden:
Absolutely. And I think anybody that’s over the age of 50 right now, so you may not have kids at home anymore, that sort of thing, but anybody that’s the age of 50 or beyond, there are things we can be sitting down and talking about now to save you taxes down the road.
Nate Kreinbrink:
Right.
Mike VanZuiden:
So it’s a perfect opportunity to plan. Our calendars are pretty wide open right now and we welcome every opportunity to sit down and talk with folks, look at situations, and let’s make some plans and keep as much of your money in your pocket and out of the government’s pocket as we can. And there are things we can do and strategies we can employ to do that. So, yeah, we welcome every opportunity to visit with folks and do planning.
Nate Kreinbrink:
And I think that planning is not just like you said there, but it’s all the time. I mean, retirement is a big thing that you walk down the hall to our kind of side of it to retirement. Can I retire? Do I have enough to retire? Taxes is a big part of that puzzle that goes into it and having the resources of yourself and Andy right down the hall, where again, a question comes up to be able to walk down there, that coordination anymore with retirement benefits, is my social security benefit taxes, is this tax, should I take this, Roth conversions, how much should I do this year? That coordination right there, I think, when we sit down with people and go through that whole process with them from day one, whether they start with you and we come on board, or they start with us and you guys come on board, seeing that process from start to finish is just simply amazing. And being able to help people that way has just been great.
Mike VanZuiden:
Absolutely, absolutely.
Nate Kreinbrink:
So that coordination again is key. You got any questions on the backlog, you haven’t received your return yet, anything along those lines, feel free to give us a call, give the tax portion a call. They’d be happy to sit down and see, “Okay, what is going on here? And how should I be able to do that?” But we are running out of time. Real quick did want to mention that every Friday NelsonCorp Wealth Management is wearing jeans for charity. Money raised in the month of July will be donated to the Clinton YWCA Half Marathon event. Mike, we tell it to Andy all the time. You get talking taxes and time sure just flies by, but.
Mike VanZuiden:
Isn’t it fun?
Nate Kreinbrink:
It is fun. It’s all great stuff. And again, a lot of times people don’t quite understand all of that. So it’s a great to have that resource joining us. Mike, I appreciate you joining me this morning. Mike Van Zuiden, NelsonCorp Tax Solutions, Nate Kreinbrink, NelsonCorp Wealth Management, bringing you this week’s Financial Focus. Thanks for tuning in and 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 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.