Saturday, February 8, 2014

Test Drive Your Retirement Plan

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Kathryn Cooper's Real World Personal Strategy Note
February 8, 2014
Now that the Super Bowl is over, and the football season is finished, we can now finally get back to looking forward to football season.

And, of course, the commercials! (Which this year seemed a little ... "ok" -- though I think I will have dreams of that Doberhuaha for a while.)

Anyway, you may have heard that tax season has officially "begun". Well, when we sit down with a tax preparation client during tax season, we are picking through history -- we are helping you sort through your 2013, and make sure that the numbers match ... AND, of course, that YOU are able to take advantage of every possible legal and ethical method to hold on to your hard-earned dollars (or sometimes receive a nice bump in your supply from a refundable tax credit).
Take a Test Drive of Your Retirement Plans
"It doesn't matter where you are, you are nowhere compared to where you can go." -Bob Proctor

People over 40 shouldn't just plan for retirement, they should rehearse for it.  Because retirement can last 20 to 30 years, it's more important than ever that "pre-retirees" (those who plan to retire in five to seven years) practice how they want to live without work as the organizational focus of their lives:

Try out different retirement lifestyles
For example, many people dream of selling the family home and traveling in an RV or going abroad. Practice this by renting a camper and going on the road for a long vacation. You may discover that travel is exhausting or boring to you.

The same holds true for relocation dreams. Rent a home where you think you may want to retire to see if it really is where you'd like to move. The weather may not suit you, or the community may not be your cup of tea. Work out these details before you commit to an expensive change.

Live with your spouse 24 hours a day 
Most couples spend much of their early years working and, thus, spending much of their time apart. It may take some time to get used to the other person's schedule, habits, and routines.

Practice living on that retirement budget
Most retirees' income is significantly less than their preretirement income. Add up all the Social Security benefits, pension income, and 401(k) and IRA savings to calculate what you can realistically expect to live on each month. Then live on that amount for a month to determine what changes, if any, you need to make to your plans. 
I hope this all helps! To your family's financial and emotional peace! 

Kathryn Cooper

(415) 279-3951

Wednesday, January 22, 2014

Real World Tax Strategies

Kathryn Cooper's
"Real World" Personal Strategy Note

Identity Thieves Want YOUR Tax Return

"Show me someone who has done something worthwhile, and I'll show you someone who has overcome adversity." - Lou Holtz


The hits keep on coming for Target Corp, and it's unfortunate for them because they seem to be a company that works hard at doing things well. In fact, they were on the forefront of "Point of Sale" (POS) security with some new software, but other retailers didn't join them, so it became cost prohibitive to go it alone.


They recently announced that they will be offering a year of free credit monitoring to those who were affected, and this seems to me an effective way of "making things right". But this crisis has highlighted a bunch of risks that you should understand ... and it provides another reason to get your taxes submitted (properly) ASAP.

Here's the list of forms you should be looking for in the mail, and online (from any employer, vendor, client or anyone else with whom you had a taxable transaction last year):
* Wage earners, watch for your W-2 forms, one from each employer.
* "Other income" (like a state tax refund, or government benefits) is shown to you on Form 1099-G
* Prize winnings -- Form W-2G
* Most canceled debt (but not all) is reported as taxable. In which case, you'll get Form 1099-C
... as I'm writing this, I realize the list is extremely long. Here's a good place for the whole list: [look under the section "Information Returns"]

So, as if there wasn't enough incentive to get your taxes prepared by someone who knows what they are doing (ahem), here's another log on that fire...

It may not surprise you to learn that identity theft is annually the number one complaint made to the Federal Trade Commission (FTC). Well, the tax return component of this crime has been heating up.

In 2010, only about 15 percent of all identity theft complaints to the FTC dealt with tax returns. Well, in 2013, that jumped to 43 percent.

All the thief requires is your SSN, a few easily-forged counterfeit documents ... and WHAMMO, they've got your expected refund.

In essence, to prevent this kind of theft of your refund, or your return filing status, you need to file your return before the thief does. Which is just another reason to start the process with us, ASAP (Here's our number: (415) 279-3951 -- call us today).

The good news is that the IRS is aware of this problem, and they do have systems in place. If this DOES happen to you, we can help you work with the IRS to get it resolved. Alternatively, of course, you can call the IRS ID Theft Protection Unit yourself at (800) 908-4490, extension 245. The hold times ... well, they're not always fun. There will be paperwork to file and other things you will have to do as quickly as possible.

Which means that it's nice to have someone in your corner who can handle this kind of thing on your behalf, right?

Other ways to protect yourself
Nobody can *guarantee* that they won't get victimized, but here are a couple steps you can take to reduce the risk...

  • If you file by mail, go to the post office. Don't place your documents in an unlocked mailbox in front of your house.
  • If you file electronically, use a secure computer on a secure network (which we happen to have). Never do anything financially sensitive from a public WiFi spot.
  • Get your return done as soon as you can. It really is in your best interest to file as early as possible.
Again, while we can never fully prevent bad things from happening, we certainly can help you cover your bases!

Visit my website

Saturday, January 18, 2014

Kathryn Cooper's
"Real World" Personal Strategy Note

Cooper's 2014 Tax Time Document Chase List

"Don't worry about failures, worry about the chances you miss when you don't even try." -Jack Canfield

Yes, this is a long list -- but it's the unfortunate reality of our tax code that it's not even comprehensive! But these items will cover 95% of our clients.  Really, this is for ensuring that we're able to help you keep every dollar you can keep under our tax code.

Even if for some strange reason you won't be using our cost-effective services this year, feel free to use this list as a handy guide...

Personal Data
Social Security Numbers (including spouse and children)
Child care provider tax I.D. or Social Security Number

Employment & Income Data
W-2 forms for this year
Tax refunds and unemployment compensation: Form 1099-G
Miscellaneous income including rent: Form 1099-MISC
Partnership and trust income
Pensions and annuities
Alimony received
Jury duty pay
Gambling and lottery winnings
Prizes and awards
Scholarships and fellowships
State and local income tax refunds
Unemployment compensation

Homeowner/Renter Data
Residential address(es) for this year
Mortgage interest: Form 1098
Sale of your home or other real estate: Form 1099-S
Second mortgage interest paid
Real estate taxes paid
Rent paid during tax year
Moving expenses

Financial Assets
Interest income statements: Form 1099-INT & 1099-OID
Dividend income statements: Form 1099-DIV
Proceeds from broker transactions: Form 1099-B
Retirement plan distribution: Form 1099-R
Capital gains or losses

Financial Liabilities
Auto loans and leases (account numbers and car value) if vehicle used for business
Student loan interest paid
Early withdrawal penalties on CDs and other fixed time deposits

Personal property tax information
Department of Motor Vehicles fees

Gifts to charity (receipts for any single donations of $250 or more)
Unreimbursed expenses related to volunteer work
Unreimbursed expenses related to your job (travel expenses, entertainment, uniforms, union dues, subscriptions)
Investment expenses
Job-hunting expenses
Education expenses (tuition and fees)
Child care expenses
Medical Savings Accounts
Adoption expenses
Alimony paid
Tax return preparation expenses and fees

Self-Employment Data
Estimated tax vouchers for the current year
Self-employment tax
Self-employment SEP plans
Self-employed health insurance
K-1s on all partnerships
Receipts or documentation for business-related expenses
Farm income

Deduction Documents
State and local income taxes
IRA, Keogh and other retirement plan contributions
Medical expenses
Casualty or theft losses
Other miscellaneous deductions

Kathryn Cooper, MBA, CB, RTRP
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Kathryn Cooper, Tax Preparer