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, it’s the third Wednesday of every month, so I am joined this morning by Mr. Andy Ferguson with NelsonCorp Tax Solutions. Andy, appreciate you taking time out of your busy time of the year to join me this morning. And it’s another kind of bitterly cold day out there today.

Andy Fergurson:
But the tropical temperatures are coming, I heard.

Nate Kreinbrink:
The tropical temperatures are coming, what do we have, mid to upper thirties by end of the weekend into next week?

Andy Fergurson:
I heard twenties, but I’ll take it. I mean, twenties at this point seems like swimsuit weather.

Nate Kreinbrink:
Today is another big day, you reminded me on the way up here that pitchers and catchers do report today in spring training for many of the baseball teams.

Andy Fergurson:
Yeah. Thus begins the most wonderful time of the year, right?

Nate Kreinbrink:
That’s exactly it. A sign that a baseball season is right around the corner, which means a sunshine and green grass. So I think we can all agree that that can’t get here soon enough.

Nate Kreinbrink:
It’s also tax season and I know, had Mike on here the other week. And again, seeing a steady increase in people coming in, dropping off, meeting with you guys. There’s a few things that we had talked about the other day that I think you mentioned continue to keep coming up, so wanted to cover a lot of those today. The first one is just the simple tax filing season. I think most people think, end of January, hey, I should have everything, I can file right away, but that’s not necessarily the case. That day when you can actually file your tax return was a little bit later this year, maybe talk a little bit about that and how that’s going to impact individuals, couples when they do go ahead and file their return.

Andy Fergurson:
Yeah, so the tax season officially opened for the IRS, Friday. So here I feel like we’ve been in tax season for about three weeks and we really are only about three days into this. And they haven’t done anything to extend on the backside of the season, and I expect that they won’t. The things that we’re hearing coming out of the Capitol are that that’s probably not going to happen. And if that doesn’t happen, essentially what we have is a condensed tax season, right? If you shorten the front end and don’t extend the back end, you’ve got to squeeze everything into a shorter time.

Andy Fergurson:
And so how that impacts people at home is you need to get your stuff together and get scheduled and get prepared as soon as possible. Those that don’t get in early or that are used to waiting till the last two weeks of the season may call their preparer and find out that they’re going to have to extend their return because the time has gone, right? We’re pushing everything that we used to do in 12 and a half weeks into 10 weeks. And there’s only so many hours in a day and I promise you, your preparer is already working all of them, and they’re even dreaming about your taxes when they’re not working. So get in, get scheduled, make sure that you’ve got a plan and don’t take for granted that ability to wait until the last moment.

Nate Kreinbrink:
Right, and this year has also brought about, in that condensed time period, a few things that you’ve seen reoccurring that maybe aren’t on people’s radar as to regular ones. And a lot of that has to do with the stimulus payments that were done last year. There’s some reporting that people need to make sure that they have with them as far as some of those things. And then also, understanding that when you file your tax return does determine your eligibility for any future stimulus. So maybe talk a little bit how those stimulus payments need to be reported on the tax return and how when you file has some impact moving forward with any future stimulus payments.

Andy Fergurson:
Sure. So stimulus payments that we received last year and at the beginning of this year, so the one you received in April and the one that you received in December or January, both of those amounts need to be reported on your tax return this year. They’re not taxable, but the IRS is looking to make sure that everybody who should have gotten that payment got that payment. If you haven’t gotten your second stimulus payment yet, you’re probably not going to get it in the mail or any other way. And so you need to report that on your taxes so that you get that stimulus added to your taxes. I’ve had a couple people come in, who don’t normally have to file and who have asked me if there’s another way for them to make themselves known to the IRS, and I am unaware of one. We’ve been scouring the IRS’s website, trying to find ways that people who don’t normally have to file can get that stimulus added back to them and everything we see points to they need to file a tax return.

Andy Fergurson:
There’s options to do that outside of a preparer. There’s some free options out there online, and then through the IRS website. And if the only reason you need to file is to get that stimulus, that may be a good option for you, but that may also be something that’s hard for somebody to navigate their way through. And so, talk to family members, see if there’s somebody that can navigate a website like that for you, or you call your preparer and you pay for a tax return, but you get your stimulus money. So that’s something to consider.

Andy Fergurson:
The other thing you mentioned was how that stimulus may impact strategy of when you file. If you file before they release another stimulus, they will more than likely use your 2020 tax return to determine your stimulus eligibility. So that’s important for anybody who’s on the edge, right? If your income puts you to where you will get more or less stimulus, you may want to consider whether or not you file early or file late.

Andy Fergurson:
I would still say, go in and get to your preparer and make sure that you have everything ready to go. And then you can talk about whether or not you want them to hold that return until it’s time to go. Your income will be different this year than it was last year. I mean, most everybody’s is. And so, if last year you were qualified and this year you won’t qualify for the full stimulus, it may be advantageous for you to wait. Whereas if last year you didn’t qualify, and this year you do, it may be advantageous for you to file early, right? But you won’t know that until you have the numbers put in and see where you’re at. So again, get an appointment, get in, get set up so that you can make an educated decision and receive the best outcome for you.

Nate Kreinbrink:
All good stuff, and probably a lot of things that people aren’t really even thinking of. But I know those stimulus payments were always a question as far as how’s this going to impact on me on taxes? So having that understanding as to again, how they’re going to be applied to your return, and then also how it’s going to look as far as determining that eligibility, and I know that’s a big thing. You look at any future proposals that are coming out. There’s the previous income threshold that’s out there, and then there’s some other ones that have a little bit lower of a threshold. So again, until anything actually is finalized, we’ll have to wait and see, but again, understanding when you file, how that does impact it.

Nate Kreinbrink:
I know there was another change that you had brought up as we were coming up here having to do with Congress and how they’re treating unemployment as far as with this current filing station. Maybe talk about that a little bit and then how that is impacting in you and how on your end, what you’re seeing from it.

Andy Fergurson:
Yeah. So the biggest concern for us right now is that Congress is considering right now various laws that will impact the 2020 tax year. That’s the tax season that we’re filing right now. That’s the tax returns that we’ve already filed hundreds of people’s returns.

Nate Kreinbrink:
That’s like people changing the rules midway through the game.

Andy Fergurson:
Absolutely. And it’s a distinct possibility this year that that could happen. And one of the things that I’ve heard considered, and again, this is not law yet, but they’re talking about the way they’re going to treat unemployment. Traditionally, unemployment is taxable income, you pay tax on your unemployment, but there’s some things that are going through Congress right now that may possibly change that. And so it’s important to again, know whether or not you want to send that tax return in right away. And it’s important to understand that if you send a tax return and they do change the law, the repercussions of that are you’re probably going to have to amend your return. And that’s going to be an extra thing that you have to do. Of course, you’ll have three years to do it, you won’t have to do it today.

Nate Kreinbrink:
By the tax deadline.

Andy Fergurson:
Yeah. But you’ll have to make a change if there’s something that impacted you in the change to the tax law. And so that’s our favorite thing as tax preparers is to hear that they’re discussing changing the tax law during tax season. It’s one of those things that makes us write letters to our congressmen and stuff like that, because it’s not cool to do that to somebody, but it is a distinct possibility. And so ask those questions when you’re in there talking to your tax preparer, say, “Hey man, I heard this on the radio. Is this real? Is there something that I need to be worried about?” And your tax preparers should be able to look at your return and say, “Yeah, we’ve heard about that, but that’s not going to impact you. So don’t worry about it.” And then you can be confident in your decisions going forward.

Nate Kreinbrink:
So again, we’re getting close to running out of time here again, as we always do, once we get going with some of these things. You guys are still open, taking new people coming in. I know, like I said, there’s been a steady flow of people coming in, but I know phones are still ringing, but still got plenty of time. So if you’re still looking at getting that done, you finally got all your documents that you’ve been waiting on. Give you guys a call. You’re still talking and taking in people.

Andy Fergurson:
Yeah, we’re still taking in people. Actually we’re experiencing so much call volume that sometimes you can’t get through. And I would say, give us another try, call back, see if you can’t get that appointment. We have had a lot of new people and we’re glad to have them again, just don’t don’t take for granted that there’s going to be a slot there for you on April 10th, because it may be filled up by now. So get your stuff, get organized, and make a plan.

Nate Kreinbrink:
Did want to mention real quick though, before we do run out of time that every Friday NelsonCorp Wealth Management is wearing jeans for charity. Money raised in the month of February will be donated to the Clinton Rotary Club Scholarship Fund. As always Andy, I appreciate you joining me on this beautiful bitter pitchers and catchers Wednesday morning.

Andy Fergurson:
Glad to do it. I got to get going though. I got an appointment in a few minutes, I’m sure.

Nate Kreinbrink:
Yeah. Again, Nate Kreinbrink with NelsonCorp Wealth Management, Andy Ferguson, NelsonCorp Tax Solutions, bringing you this week’s Financial Focus. Thanks again 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.