Posts Tagged ‘Kim Greenblatt’

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Medical Expenses on Schedule A Question

Friday, September 12th, 2008

I had a question from a reader about Medical Expenses, specifically, the age old general question, what qualifies as a medical expense?

First, you need to have enough deductions so that you can file with a Schedule A, Itemized Deductions.  The medical expenses generally (at least for 2007) can only be deducted if they exceed 7.5% of the amount of Form 1040, line 38 (that is your adjusted gross income and the line number it appears on may vary from year to year depending on what changes are happening with tax law and tax forms).

You will want to look at Publication 502 that will explain in detail what you can and cannot deduct as a medical deduction.  Some examples of valid medical deductions are doctor co-pays, medical  insurance premiums, dental insurance premiums and long term care premiums (make sure you double check with Pub 502 to see if they are valid medical plans for coverages).

Prescription medicine and insulin  are deductible.

Hospital visits where you are not reimbursed by an insurance carrier are deductible.

Lab work is deductible as well.

Medical treatment for drug and alcohol addiction.

Eyeglasses and eye exams.

Some items that are not deductible are:

Vitamins

Cost of diet food

Cosmetic Surgery

Vitamins, despite what anybody tells you are not medical expenses no matter how well they are working for you and keeping you alive.  Same holds true for diet food or cosmetic surgery.  Now, the one surgery that is deductible is if you were medically designnated as morbidly obese and you need the surgery to save your life because your weight problems were literally killing you.  That has to be with documentation from an appropriate doctor and probably surgeon.

You would best check with your tax professional when in doubt.  Depending on your vocation, there may be some items that may be deductible but you would have to look at how the deductions directly apply to your vocation and income.

Remember that the medical expenses of your wife and your dependents are added into the Schedule A as well.  Just make sure that you hold onto your receipts for the hospital visits, the co-pays, the medicine, pharmaceuticals and whatnot.  If there are special changes you need to do to your house to accomodate your medical condition, be sure to research that or have a tax pro look into it as well.   There may be some deductions there as well.

Hope that talking about taking legitimate medical expenses makes you “feel better”!

Kim Greenblatt

 

You are reading about medical expenses in Kim Greenblatt’s blog, profitable.

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Cool Thinking In Hot Times

Thursday, September 11th, 2008

As a consultant and manager, you have to keep emotion out of the picture when making business decisions.  People on your team and business partners will come to you with heads of steam and be screaming for all sorts of reasons.  A program isn’t in the system they need, there has been a systems failure, they can’t reach a vendor.  A lot of times you have to be the den mother and voice of reason in keeping things on an even keel.  Even if the issue is something that can shatter a project, generally no good comes out of screaming and yelling.

 

Take the same skills to heart when dealing with issues with your family or finances at home.  When you feel that you are about to blow your stack, use whatever coping techniques work for you (counting to ten before saying a word, thinking of vacationing in Hawaii, etc) and then pause to think.  Sometimes backing off of the situation and thinking about it for a few minutes will give a clearer answer than just answering and jumping right in.

Decades ago, I use to have one boss who always jumped in screaming and she ended up getting terminated by upper management for the same reasons her staff feared telling her when anything went wrong.  Don’t be in a position to be that type of boss or parent or spouse at home!

With the economy being tough, it is easy to be jaded and angry all the time.  Try not to be.  It won’t help in the long run and it will cause problems in your relationships and with your health.

A simple breathing exercise where you go to a quiet spot and just try to breathe in and out for five minutes works wonders if counting to ten doesn’t help.  If you can take five minutes to go outside or go somewhere out of the “hot zone” to cool off – and get the people who are “hot” out of the area for a minute that will help with their persepective as well.

Kim Greenblatt

 

It pays to keep cool thinking in hot times.

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Getting Organized and Staying Organized

Wednesday, September 10th, 2008

What do project management, teaching, running a business and running a family have in common?  Organization skills.  Do you think it is by coincidence that projects get completed, buildings get built, the kids are clean, dressed, fed and off for school?  How about that everything you will need for a class is explained for you on the first day?  That’s right, you can thank organization.

Moms, project managers, teachers and businessmen know that you have to have your own house literally in shape before you can tackle the outside world.  If you are a little rusty in these areas, it is time to get profitable by improving your organization game.  In fact, find a parent who has a special needs child if you want to see a master in organization skills!

Got a calendar?  If not, get one.  I am not talking about Outlook or a computer reminder.  I am talking about a good old fashioned paper one with months and days and room to write inside the squares. 

Start writing down upcoming events and schedules for your activities (pick up kids from soccer), the kids activities (drop kids off at soccer), your business plans (meeting with sales team noon on Friday), everything that is going to cut into your time should be written down. 

If you are comfortable with cell phone calendar reminders or Blackberry reminders, great.  But it doesn’t work if you listen to the reminder “beep”, turn it off and don’t act on it!

Your garage or dayroom a mess?  Time to start throwing stuff out a la “Clean Sweep” and put whatever you still need (and hopefully it won’t be much) in boxes or shelves so you can actually find it.  The rule of thumb though is if it isn’t a financial document you need to save for 3-7 years and you haven’t looked at it in 2 years, you really should trash it or sell it.

How do I stay organized?  When I receive mail I throw out junk and anything that isn’t a bill or a birthday/anniversary/friendship card.  I try to save the cards only a little bit after the holiday unless they are something special (like the entire family and the neighborhood signed it or something like that).  How many pictures of your kids do you really need?  If you have a lot of duplicates, think of giving the dupes away and maybe only keeping one set of dupes for each kid.  You can always make more or scan the pictures later on.

Before I go to bed each night I review with the family what the next day’s activities and schedule will be and we work out conflicts (Mom is taking Arianna to the doctor so Dad has to pick up Jacob, things like that).  You should be doing the same thing.  Carry this thought process over to your business and you will be very profitable and playing your “O” – for “organized” –  game.

Kim Greenblatt

 

Learn with Kim Greenblatt’s blog, profitable, to be organized and stay organized.

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How To Be A Tax Student In Tax Class

Tuesday, September 9th, 2008

With tax classes starting up, I see all types of students who come with all sorts of expectations in what they want out of learning how to be a tax professional. By tax professional, I mean certified in doing Federal income tax forms (basic ones at any rate) and California ones. Some students come in with an open mind, some come in with an open hand and expect to get certified without any work. After the first one or two sessions there is usually some dropping out and thinning of the herd. The reasons vary from the work or the fact that they really didn’t want to learn how to prepare taxes.

The best way to prepare how to do taxes is to have a little familiarity with money, if nothing else. Skills required are patience, fondness with working with numbers, ability to work with people and enjoying mind numbing details and boring laws. If you can stomach all of that you are home free. Expect that some parts of the class will be easier for you than others. If you are use to doing your own research with the Federal government and all the respective state tax authorities, you are already ahead of the game. Depending on where you take the class, the next obstacle is learning the software, which, if you have a good teacher, shouldn’t be a problem.

Bring blank paper, pens and pencils and a cheap calculator. They are available at places like the 99 cents store or Dollar Tree for a dollar. Can’t go wrong with that and the math tends to be simple addition, subtraction, multiplication and division. You will learn about appropriate rounding in tax class. Depending on what state you are in, there will be different requirements for passing. For my money, in order to be a profitable tax professional, make sure you take a class from somebody where you actually get to do tax returns. There is a lot more to tax preparation than multiple choice or true false answers. When you are interviewing a client to get information, you need to know the correct question to ask and not expect a test formatted answer!

A couple of other tips – if the instructor doesn’t want to answer a particular questions right away, that is normal. It may be out of scope for what he or she is trying to teach and believe me, there is a lot of information that has to be covered in each session. Wait for the break and ask the teacher than.

Plan on making a commitment. You will not be allowed to miss many classes and information builds upon itself so if you miss class 3, you will need to make it up somewhere else because class 4 may have information in it that you won’t understand.

Have faith in yourself and expect to spend time and effort and you will pass your tax class. Hey, I wasn’t always a tax professional, businessman, manager and teacher. I also still consider myself a student learning something new all the time. When it comes to tax law, to be be closed to learning isn’t very profitable (or smart).

Kim Greenblatt

You are learning from Kim Greenblatt’s blog, profitable, how to be a tax student in tax class.

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Kim’s EMF – Emergency Medical Fund

Monday, September 8th, 2008

Take five minutes now. I want you to answer a question for yourself.
Do you have money saved up in case you have a medical emergency? If you were to slip and break your arm and somebody has to pick up the kids, get them home or take care of your parents or a special needs loved one, do you have emergency cash available?

Separate from your insurance, you should have cash put aside for some basics that people don’t think about:

Medical Deductible – They range from $5 (if you are lucky) to $100 (average these days) to whatever it is on the plan you have. Don’t always count on credit cards to get it covered. Make sure you get a receipt for any deductibles you pay if you use cash.

Prescriptions – Pain killers, antibiotics, and whatever else – figure $20-200 depending on what has happened to you and your medical coverage.

Parking – Hospital parking runs from free to $15 in some cities.

Food – Relatives who visit need to be fed and watered (hi kids) and snack machines, cafeteria meals are easier to do when everything is up in the air then worrying about brown bagging it to the hospital.

Phone Cards – Some hospitals don’t give you outgoing phone service, you should plan for it accordingly by having some phone cards for $20 in case you don’t have your cell phone with you when you are checked into the hospital or it is damaged or separated from you. Watch the hours that they don’t expire right away or have a relative buy a phone card and bring it to you the day you check into the hospital. Remember also cell phones aren’t normally allowed in a hospital.

This is just a start – you can figure regionally for what the cost might be for you. Figure the neighborhood of $200 – $1000 depending on what city that you live in and what kind of medical coverage that you have. Keep it in your checking account and accessible by your ATM card.

I know it is weird locking up money like that but trust me, when you are in pain, and there are a million other things going on you need to take care of, you will be glad that you had some cash saved up. Insurance, if you have the coverage, will kick in, but it doesn’t always cover all of the little things that you need to have taken care of when you check into a hospital.

Kim Greenblatt

You are in Kim Greenblatt’s blog, profitable, where he is suggesting you establish an Emergency Medical Fund of cash.

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Generic or Name Brand Goods

Sunday, September 7th, 2008

If you have children, you know that once they want something they see, it is pretty hard to change their minds.  Commericals are pretty quick and they try and pour a lot of information into selling you something in a very short amount of time.  Kids, who watch a lot of television or surf the net, see a lot of ads and some of them, especially if their peers are doing it, want to buy something.

If you are trying to save money, one of the little secrets that parents use is that they try to buy generic.  Oh, I am not talking about buying generic supermarket soda like Albertson’s brand instead of Coca Cola (though I drink both and have gotten my son to drink it as well).   I am talking more along the lines of getting a knock off designer knapsack for school or pair of shoes that aren’t $129 a pair.  Eventually, manufacturers will make similar products, or as much as they can skate patent or copyright infringement.  In some cases, kids will accept the product gladly.  In others, they may raise a stink.

If you have been teaching your kids good fundamental financial values and learning about money, that shouldn’t be a problem.  If you find yourself a slave to designer labels, maybe it is time that you go on a generic diet yourself to set an example for your kids.  If you don’t have kids and your job doesn’t depend on you dressing like a celebrity fashionista, I would say start saving money and go generic.

Some exceptions are in paper towels and toilet paper.  I am the first to admit that not all paper is the same and some is rougher than others.  Maybe you have some exceptions as well.  I am not asking you to go completely generic like in the old movie “Repo Man”, just be aware of what you are spending money on and ask yourself if you can get the same product or service for a cheaper price.

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Thinking About Filing Statuses for Taxes

Wednesday, September 3rd, 2008

I received an email asking me what filing status should the person file under and I had to explain that without knowing all the background information I can’t make a good determination.  I am starting up teaching basic tax preparation again so I thought I would share some of my information with you, gentle profit oriented readers.

The IRS (google them, you will find them, trust me),  has more detail than you probably are interested in on the subject but let me try and bring the key points home here:

There are five filing statuses:

Single, Married Filing Jointly, Married Filing Separately, Head of Household, and Qualifying Widow(er) With Dependent Child.

If more than one filing status applies to you, choose the one that will give you the lowest tax.

Marital Status
In general, your filing status depends on whether you are considered unmarried or married. For federal tax purposes, a marriage means only a legal union between a man and a woman as husband and wife.

Unmarried persons.   You are considered unmarried for the whole year if, on the last day of your tax year, you are unmarried or legally separated from your spouse under a divorce or separate maintenance decree.

  State law governs whether you are married or legally separated under a divorce or separate maintenance decree.

Divorced persons.    If you are divorced under a final decree by the last day of the year, you are considered unmarried for the whole year.

Divorce and remarriage.   If you obtain a divorce in one year for the sole purpose of filing tax returns as unmarried individuals, and at the time of divorce you intended to and did remarry each other in the next tax year, you and your spouse must file as married individuals.

Annulled marriages.   If you obtain a court decree of annulment, which holds that no valid marriage ever existed, you are considered unmarried even if you filed joint returns for earlier years. You must file amended returns (Form 1040X) claiming single or head of household status for all tax years affected by the annulment that are not closed by the statute of limitations for filing a tax return. The statute of limitations generally does not expire until 3 years after your original return was filed.

Head of household or qualifying widow(er) with dependent child.   If you are considered unmarried, you may be able to file as a head of household or as a qualifying widow(er) with a dependent child. See Head of Household and Qualifying Widow(er) With Dependent Child to see if you qualify.

Married persons.   If you are considered married for the whole year, you and your spouse can file a joint return, or you can file separate returns.

Considered married.   You are considered married for the whole year if on the last day of your tax year you and your spouse meet any one of the following tests.
You are married and living together as husband and wife.

You are living together in a common law marriage that is recognized in the state where you now live or in the state where the common law marriage began.

You are married and living apart, but not legally separated under a decree of divorce or separate maintenance.

You are separated under an interlocutory (not final) decree of divorce. For purposes of filing a joint return, you are not considered divorced.
Spouse died during the year.   If your spouse died during the year, you are considered married for the whole year for filing status purposes.

  If you did not remarry before the end of the tax year, you can file a joint return for yourself and your deceased spouse. For the next 2 years, you may be entitled to the special benefits described later under Qualifying Widow(er) With Dependent Child.

  If you remarried before the end of the tax year, you can file a joint return with your new spouse. Your deceased spouse’s filing status is married filing separately for that year.

Married persons living apart.   If you live apart from your spouse and meet certain tests, you may be considered unmarried. If this applies to you, you can file as head of household even though you are not divorced or legally separated. If you qualify to file as head of household instead of as married filing separately, your standard deduction will be higher. Also, your tax may be lower, and you may be able to claim the earned income credit. See Head of Household, later.

Single
Your filing status is single if, on the last day of the year, you are unmarried or legally separated from your spouse under a divorce or separate maintenance decree, and you do not qualify for another filing status. To determine your marital status on the last day of the year, see Marital Status, earlier.

Widow(er).   Your filing status may be single if you were widowed before January 1, 2007, and did not remarry before the end of 2007. However, you might be able to use another filing status that will give you a lower tax. See Head of Household and Qualifying Widow(er) With Dependent Child, later, to see if you qualify.

How to file.   You can file Form 1040EZ (if you have no dependents, are under 65 and not blind, and meet other requirements), Form 1040A, or Form 1040. If you file Form 1040A or Form 1040, show your filing status as single by checking the box on line 1. Use the Single column of the Tax Table, or Section A of the Tax Computation Worksheet, to figure your tax.

Married Filing Jointly
You can choose married filing jointly as your filing status if you are married and both you and your spouse agree to file a joint return. On a joint return, you report your combined income and deduct your combined allowable expenses. You can file a joint return even if one of you had no income or deductions.

If you and your spouse decide to file a joint return, your tax may be lower than your combined tax for the other filing statuses. Also, your standard deduction (if you do not itemize deductions) may be higher, and you may qualify for tax benefits that do not apply to other filing statuses.

***

For more information, you can check with the IRS and you may be interested in checking out my book,

“Bad Tax Idea, Good Tax Idea” for some tips that accountants and tax professionals might not give you.  You can find that book on Amazon (you can google to find that too).  All information posted here is for you to review and for more serious study and tax prepatation, kindly due your own research or consult your tax pro!

Good luck with your thoughts on Filing Statuses for Taxes!

Kim Greenblatt

 

You are in Kim Greenblatt’s blog, profitable, trying to figure out what filing status means for tax preparation!

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The First Carnival of Special Needs and Money

Tuesday, September 2nd, 2008

Step right up, folks.  It is time for the carnival of special needs and money.  The carnival has blogs that may (or may not) help you with dealing with special needs and money.

As usual dear carnival guests, do your own research and due diligence with any business claims found on the net. Like any carnival, it is up to you to see which booths run fairly and which booths have the crane and kewpie dolls rigged!

Being the initial carnival, the boardwalk may be bare but fear not, as the carnival grows, so will the number of booths and rides.  Shall we get started?

 

Special Needs – The Emotional Roller Coaster
Fasten your seat belts on the emotional roller coaster for a look at my own profitable blog and you can share the joy of seeing Arianna, my daughter who has Rett Syndrome, in one of her rare moments when she talks and responds appropriately. Girls with Rett Syndrome tend to be non-verbal.

Special Needs-The Money Go Round
Tired of the baloney you hear about get rich quick schemes on the internet? Check out Money Talks and specifically this entry. Aamir Ziad states “Naturally every person wants life without being dictated or under pressure all the time by bosses, every persons wants luxurious, holidaying life- yet earning a reasonable income to at least a level to fulfill basic to luxurious needs. So naturally we all get attracted by these kind of Ads – But is it a Myth or Internet jobs/work are good enough to fill the stomach of hundred of thousands…? ”

I get questions about publishing all the time and the importance of book covers. Please feel free to join me in the dunking booth and check out if I am all wet when it comes to designing book covers, leave alone giving advice on how to make them!

Kindly check back for my regular profitable blog soon and we will try and get another carnival in a month.

If you are interested in buying any of my books, please remember that a portion of all my sales go to Rett Syndrome research.

Be healthy, wealthy, happy and wise!

Kim Greenblatt

You are reading Kim Greenblatt’s profitable blog. Welcome to his First Blog Carnvial of Special Needs and Money!

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September Tax and Financial Planning

Monday, September 1st, 2008

Here it is folks, we are in the last quarter of the year.  For this year, we are looking at a Presidential election, possibly some important elections for you locally in your city or state and time to plan for your taxes if you haven’t been doing it now.

If you haven’t planned for your quarterly taxes and you owe money, get ready to write a check.  Unless you are unemployed and strapped for cash, it is better to pay what you owe now rather than to risk penalties and problems later on.  If you are uncertain, please check with your local tax professional.

Any donations for charity have to be taken care of in the remaining quarter of the year.  Make sure that you are aware of the changes in the law for charitable contributions.  If you need to get letters of appriasal big ticket items that you are donating, make sure the people that are preparing the estimates are experts in their fields.  If the receiving charity doesn’t use or resell your gift you may not get value for that contribution.  Make sure that you understand the new contribution laws very clearly.

Planning on having children and are married?  The kids will be deductions for the current year even if they are born on Dec 31 at 11:59 PM.  Congratulations.  Don’t go out of your way to get pregnant though just for the sake of having kids.  Make sure you and your spouse talk things over.

 

While you are it, take some time and talk about possible joint incomes if you are getting serious with your BBF or significant other and thinking about marriage.

If you are in business, take some time to see what needs pruning financially. We are in a slow business cycle and the chances are that things will get worse or stay flat before they get better.

If you are planning on buying things for investment purposes or selling them, maybe alleged collectible items, you may want to keep detailed records of your transactions. Remember too that cash is king in hard times.

Perhaps you may want to invest in a book on certain types of gambling? Part of the proceeds of all the book sales go to research Rett Syndrome (RTT). Rett Syndrome affects a girl born every fifteen minutes. Boys born with the Rett gene die at birth.

May your Autumn be a profitable one and not a Fall.

Kim Greenblatt

You are deep in Kim Greenblatt’s profitable blog learning about September Tax and Financial planning.

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Use your Sunday for Rest and Planning for the Week.

Sunday, August 31st, 2008

Sunday is traditionally a day of rest and like most of us, I find on Sundays that I end working just as hard on house chores or things that I couldn’t get done during the week. One of the things I do is try to get a pulse for what is coming up in the upcoming week.

I check my calendars, reflect about what projects (if any) are hitting their deadlines, who do I need to contact to get things done, etc. I make a list of chores that have to be done and any pre-planning. An example of pre-planning is making a tickler in Outlook or a memo somewhere that quarterly taxes will be coming due and I have to write checks for the Fed and State of California. I often talk about the importance of making quarterly tax payments and if you haven’t heard enough from me on the subject before, consider this your reminder. Don’t forget quarterly taxes are due Sept 15 for the Fed and if you live in a state that has state income taxes, you will need to mail in a payment before that date as well to avoid possible penalties.

Fall is usually birthday and anniversary city for me. I have to start earmarking savings for birthday presents for my mother (Happy Birthday Mom!), wife (Happy Birthday Sharren) and daughter (Happy Birthday Arianna). Sure, you don’t have to spend money to have a fun and profitable birthday but even if I were to prepare meals at home for the birthday people I still need to buy groceries.

If you are planning any trips, make sure your out of town resources like hotels and transportation are in place with reservations and tickets. It doesn’t hurt to confirm them once before leaving. Weather changes may influence travel.

If people are coming into town, plan your time accordingly and make sure that you schedule rest time for yourself.

If you are teaching and resuming school or starting up, try and get some extra lesson plans finished in advance to give yourself some breathing space.

Interested in more suggestions? Please let me know. Otherwise I am going to actually try and REST this Sunday!

Kim Greenblatt

You are reading Kim Greenblatt’s blog entitled, profitable. Use your Sunday for Rest and Planning for the Week.

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