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You Don’t Have to Worry: Tax Answers from Jeff Schnepper

You Don’t Have to Worry: Tax Answers from Jeff Schnepper

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    No matter how prepared you are for tax season, you probably worry at least a little whenever April 15th is getting close. We’ve covered your last-minute tax options in the past, but no matter how close that deadline is getting, we want to reduce your worry. Jeff Schnepper, MSN’s tax expert, agreed to answer a few questions for us, and offered a little reassurance.

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    Tax Misconceptions — and Problems

    One of the major reasons that our taxes keep us up at night, according to Jeff, is that there are so many myths and misconceptions about taxes: topics like who you can claim as a dependent and what you can take as a deduction involve as many urban legends as a bad horror movie. And it doesn’t stop there. Jeff says: “The most common misconception people have about taxes is that everybody else is cheating and getting away with something….giving them the “right” to fudge. Cheating is wrong and I’ve found that the taxpayers I work with understand, and want to do the right thing. The problem is that the law changes every year, and sometimes three and four times in a single year. The professionals are overwhelmed and the average taxpayer completely lost. It’s not that people are cheating – they’re making errors because they don’t know the rules.”

    The past few months have shown the truth of that statement. If you consider just the appointments that President Obama has made (or attempted to make), it becomes obvious very quickly that even politicians who can afford the best tax preparers in the country can’t get their taxes done correctly.

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    What We Can Do to Reduce the Worry

    Just because the tax system is complicated doesn’t mean that the average taxpayer needs to spend the time between now and April 15th cringing, however. Even the biggest tax bogeyman of them all — an audit by the IRS — isn’t something you should spend too much time worrying about. While you can minimize your overall chances of being audited by following the rules as closely as you can, and by having the right documentation, there’s a certain element of chance.

    “You can’t avoid an audit. Returns are selected randomly as well as based on the IRS DIF computer program,” says Jeff. If there’s nothing left that you can do to make sure that your tax return is filled out accurately, you can stop worrying. If the computer picks your number, you may have to sit down with an auditor, but there’s nothing else you can do to affect the process.

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    A Few Last Minute Options

    Even though you’ll get the best results for preparing your tax return by starting as early as possible, Jeff was able to point out a few last minute deductions that you can pick up after December 31st: “Do you qualify for a deductible IRA or would a Roth be better. Can you contribute to a SEP?” He suggests looking into your IRA options if you’re still searching for deductions.

    Jeff also notes that there are a few extra things to consider this year, if you’ve been affected by the current economic situation. Jeff says, “Sit down with a tax pro if you may lose your house. Congress passed a law that wipes out any taxes on debt discharge income on a principal home. But, you have to do it right and file the appropriate forms.” He also pointed out that if you’ve refinanced your mortgage, you can deduct any points you pay over the life of the refinance. You can even deduct any unamortized points on your original refinance if you refinance a second time.

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    “The laws are in flux and are changing as you read this. For example, now the first $2,400 received in unemployment benefits escapes tax. You can get a $1,000 deduction for real estate taxes even if you take the standard deduction. For 2009, you can deduct sales tax on a new car even if you don’t itemize. If you don’t know the rules, you’re going to have a hard time playing the game,” says Jeff. He makes it clear that if you aren’t staying up to date on the changes in tax laws, you’re going to have a hard figuring out your taxes.

    Getting Ready for Next Year

    You can make your 2009 tax return easier by starting now. The secret to making tax season simple is setting up a system to document both your income and your deductible expenses throughout the year and keep it up to date. Jeff described one system his clients have been known to use: “For substantiation, I have clients who throw all their checks and receipts in a box. Once every month or so they sit down and put those checks and receipts into envelopes with tax classification. So, there’d be an envelope for contributions, investment expenses etc. At the end of the year, they add them up, don’t double count, and put the number outside the envelope. Those are the numbers they give me for their tax returns. And, they never have to fear an audit. An audit can only ask them to substantiate the numbers on the return. They already have the backup available in each envelope!” It doesn’t matter exactly what system you use, though, as long as you have one in place — and you keep it up to date throughout the year.

    If you have a question about your taxes, Jeff Schnepper is MSN.com’s Tax Expert. You can find him at money.msn.com, where he answers questions every day. In addition to his MSN columns, Jeff is the author of How to Pay Zero Taxes, which is now in its 16th edition, as well as several other finance and tax-related books.

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    Last Updated on September 18, 2020

    7 Simple Rules to Live by to Get in Shape in Two Weeks

    7 Simple Rules to Live by to Get in Shape in Two Weeks

    Learning how to get in shape and set goals is important if you’re looking to live a healthier lifestyle and get closer to your goal weight. While this does require changes to your daily routine, you’ll find that you are able to look and feel better in only two weeks.

    Over the years, I’ve learned a lot about what it takes to get in shape. Although anyone can cover the basics (eat right and exercise), there are some things that I could only learn through trial and error. Let’s cover some of the most important points for how to get in shape in two weeks.

    1. Exercise Daily

    It is far easier to make exercise a habit if it is a daily one. If you aren’t exercising at all, I recommend starting by exercising a half hour every day. When you only exercise a couple times per week, it is much easier to turn one day off into three days off, a week off, or a month off.

    If you are already used to exercising, switching to three or four times a week to fit your schedule may be preferable, but it is a lot harder to maintain a workout program you don’t do every day.

    Be careful to not repeat the same exercise routine each day. If you do an intense ab workout one day, try switching it up to general cardio the next. You can also squeeze in a day of light walking to break up the intensity.

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    If you’re a morning person, check out these morning exercises that will start your day off right.

    2. Duration Doesn’t Substitute for Intensity

    Once you get into the habit of regular exercise, where do you go if you still aren’t reaching your goals? Most people will solve the problem by exercising for longer periods of time, turning forty-minute workouts into two hour stretches. Not only does this drain your time, but it doesn’t work particularly well.

    One study shows that “exercising for a whole hour instead of a half does not provide any additional loss in either body weight or fat”[1].

    This is great news for both your schedule and your levels of motivation. You’ll likely find it much easier to exercise for 30 minutes a day instead of an hour. In those 30 minutes, do your best to up the intensity to your appropriate edge to get the most out of the time.

    3. Acknowledge Your Limits

    Many people get frustrated when they plateau in their weight loss or muscle gaining goals as they’re learning how to get in shape. Everyone has an equilibrium and genetic set point where their body wants to remain. This doesn’t mean that you can’t achieve your fitness goals, but don’t be too hard on yourself if you are struggling to lose weight or put on muscle.

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    Acknowledging a set point doesn’t mean giving up, but it does mean realizing the obstacles you face.

    Expect to hit a plateau in your own fitness results[2]. When you expect a plateau, you can manage around it so you can continue your progress at a more realistic rate. When expectations meet reality, you can avoid dietary crashes.

    4. Eat Healthy, Not Just Food That Looks Healthy

    Know what you eat. Don’t fuss over minutia like whether you’re getting enough Omega 3’s or tryptophan, but be aware of the big things. Look at the foods you eat regularly and figure out whether they are healthy or not. Don’t get fooled by the deceptively healthy snacks just pretending to be good for you.

    The basic nutritional advice includes:

    • Eat unprocessed foods
    • Eat more veggies
    • Use meat as a side dish, not a main course
    • Eat whole grains, not refined grains[3]

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    Eat whole grains when you want to learn how to get in shape.

      5. Watch Out for Travel

      Don’t let a four-day holiday interfere with your attempts when you’re learning how to get in shape. I don’t mean that you need to follow your diet and exercise plan without any excursion, but when you are in the first few weeks, still forming habits, be careful that a week long break doesn’t terminate your progress.

      This is also true of schedule changes that leave you suddenly busy or make it difficult to exercise. Have a backup plan so you can be consistent, at least for the first month when you are forming habits.

      If travel is on your schedule and can’t be avoided, make an exercise plan before you go[4], and make sure to pack exercise clothes and an exercise mat as motivation to keep you on track.

      6. Start Slow

      Ever start an exercise plan by running ten miles and then puking your guts out? Maybe you aren’t that extreme, but burnout is common early on when learning how to get in shape. You have a lifetime to be healthy, so don’t try to go from couch potato to athletic superstar in a week.

      If you are starting a running regime, for example, run less than you can to start. Starting strength training? Work with less weight than you could theoretically lift. Increasing intensity and pushing yourself can come later when your body becomes comfortable with regular exercise.

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      7. Be Careful When Choosing a Workout Partner

      Should you have a workout partner? That depends. Workout partners can help you stay motivated and make exercising more fun. But they can also stop you from reaching your goals.

      My suggestion would be to have a workout partner, but when you start to plateau (either in physical ability, weight loss/gain, or overall health) and you haven’t reached your goals, consider mixing things up a bit.

      If you plateau, you may need to make changes to continue improving. In this case it’s important to talk to your workout partner about the changes you want to make, and if they don’t seem motivated to continue, offer a thirty day break where you both try different activities.

      I notice that guys working out together tend to match strength after a brief adjustment phase. Even if both are trying to improve, something seems to stall improvement once they reach a certain point. I found that I was able to lift as much as 30-50% more after taking a short break from my regular workout partner.

      Final Thoughts

      Learning how to get in shape in as little as two weeks sounds daunting, but if you’re motivated and have the time and energy to devote to it, it’s certainly possible.

      Find an exercise routine that works for you, eat healthy, drink lots of water, and watch as the transformation begins.

      More Tips on Getting in Shape

      Featured photo credit: Alexander Redl via unsplash.com

      Reference

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