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Speaker 1: Welcome to how to Money. I'm Joel, I'm Matt.

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Speaker 2: Today we're talking trustworthy tax advice with Jasmine Delucci.

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Speaker 1: Yeah, so, imagine this scenario where you purchase pretty much

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Speaker 1: whatever you want at the grocery store, right, so you

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Speaker 1: frequently go out to eat, and then on top of that,

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Speaker 1: you always buy drinks for your friends, like, no questions

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Speaker 1: asked anytime you go out. Like, that's about what it

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Speaker 1: would take to get food spending up to around fifteen

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Speaker 1: percent of your average household income. But if you ask

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Speaker 1: me like that sounds insane. It's not how I shop

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Speaker 1: at the grocery store at least, but it is how

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Speaker 1: a lot of Americans think about their tax situation. It's

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Speaker 1: they almost accept it as like this foregone conclusion. On average,

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Speaker 1: most folks pay a little under fifteen percent. They assume

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Speaker 1: that's just the way it is. But we think there

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Speaker 1: is a more strategic way to approach this inevitable expense.

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Speaker 1: And here to talk about doing that well is Jasmine Delucci.

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Speaker 1: She's a tax attorney at CPA and an enrolled agent.

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Speaker 1: Jasmine has a wealth of knowledge around the US tax code.

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Speaker 1: She started posting online because she believes that tax law

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Speaker 1: should be available to everyone. She even claims it's fun.

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Speaker 1: These all. These are other things she puts out there

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Speaker 1: before her videos over on YouTube in particular, but uh,

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Speaker 1: here to talk to us today, to share her passion

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Speaker 1: for tax law with us is Jasmine Deluci. Thank you

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Speaker 1: so much for coming on the show.

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Speaker 3: Yeah, thank you, guys, Glad to.

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Speaker 1: Have you, Jasmine.

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Speaker 2: First question that we ask everyone who comes on, though,

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Speaker 2: is what do you like to sporge on? Matt and

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Speaker 2: I sporge on good craft beer even though we're saving

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Speaker 2: and investing all along the way, even when we get

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Speaker 2: to enjoy our splurge here, what about you? What do

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Speaker 2: you like to splurge on?

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Speaker 4: So honestly, like my default answer is literally tax classes,

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Speaker 4: which is.

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Speaker 3: Probably not intending to go for.

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Speaker 4: But like my default is, like, right now, I'm spending

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Speaker 4: way too much money on NYU tax classes. Actually literally

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Speaker 4: like what I like to do in my free time.

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Speaker 1: But wow, you look in selete taxes, full disclosure. A

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Speaker 1: little peak behind the curtain, Joel before we hit record,

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Speaker 1: ask Jasmine, do you consider yourself a nerd?

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Speaker 4: No?

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Speaker 2: I wasn't trying to cast expersions or anything. I was

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Speaker 2: just asking, so.

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Speaker 1: I think here's your answer. So well, okay, well, this

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Speaker 1: is obviously a business expense. That's actually something we'll get

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Speaker 1: to later on in the show. Jasmine, the first I

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Speaker 1: think that falls into the category of continuing ed further education,

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Speaker 1: is that, right? I don't know if that's.

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Speaker 3: Mostly There are some details with some of the stuff

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Speaker 3: that's for.

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Speaker 4: Degree education, but yeah, I mean generally, I just love

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Speaker 4: to spend on learning, and so yeah, usually if it's

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Speaker 4: learning and it's tax related, it's it's usually deductible.

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Speaker 2: All right, okay, all right, So is there anything else

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Speaker 2: that Jasmine that you do for fun besides learn more

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Speaker 2: about taxes or deliver great tax advice?

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Speaker 3: There is?

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Speaker 4: I was thinking about it because I was like, oh, no,

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Speaker 4: that one's just full business. I mean literally what I

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Speaker 4: do twenty four to seven, it really is. It's like

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Speaker 4: working out or working. But the thing that I've gotten

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Speaker 4: really obsessed with lately is if do you guys know

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Speaker 4: Brian Johnson, Yeah, yeah.

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Speaker 1: Yeah, you guy who never wants to die?

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Speaker 4: Right, Yeah, So I've gotten into all of his stuff.

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Speaker 3: I'm like drinking the olive oil taking.

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Speaker 1: This Jasmine has paid for the protocol. I'm guessing what

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Speaker 1: we can talk about that later after. We don't want

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Speaker 1: to bore all of our We've actually kind of gone

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Speaker 1: through this before on the show. That's fascinating. Yeah, to

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Speaker 1: save Joel just the heartache as well, to stop my

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Speaker 1: eyes from blazing over here. We talk to guests sometimes.

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Speaker 1: There's one conversation we had with a guest one time

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Speaker 1: that went on for like ten minutes after we stopped rolling.

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Speaker 1: Joel's just like, let's just kind of move on with life,

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Speaker 1: like we're gonna talk about this. Matt's like Andrew Huberman Disciples. Yeah,

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Speaker 1: I'm more along like the te Heuberman path as opposed

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Speaker 1: to the Johnson.

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Speaker 4: Well, hey, the goal is to live forever and practice

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Speaker 4: tax law forever.

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Speaker 3: Then, you know, I gotta kind of put that in

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Speaker 3: one pack.

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Speaker 1: You are on the right path. I can't wait t

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Speaker 1: you make those T shirts up. I'll wear Well. I'm

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Speaker 1: guessing there's very little overlap when it comes to tax

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Speaker 1: law and Bride's But let's talk about that though. Jus me,

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Speaker 1: because you became an enrolled agent while you were still

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Speaker 1: in high school. From what I understand, I guess why

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Speaker 1: did you do that? How did that come about? Share

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Speaker 1: your history with us A little bit.

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Speaker 4: Yeah, I mean really, like the easiest answer is that

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Speaker 4: my parents were both in tax so it's something that

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Speaker 4: I'd already been exposed to at a young age. And

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Speaker 4: my dad was an enrolled agent and he still is,

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Speaker 4: and so I don't know, I just always like I

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Speaker 4: remember in eighth grade I told my friends. I was like, guys,

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Speaker 4: I'm going to be a tax attorney, and they were like, no,

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Speaker 4: you're not. I was like, you know, So over the years,

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Speaker 4: I just, you know, I think people made me question it,

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Speaker 4: like maybe I did decide this like too early. So

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Speaker 4: I kept looking at other options and nothing was as

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Speaker 4: appealing to me as continuing on the tax law route.

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Speaker 4: And so then with the enrolled agent exam, you don't

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Speaker 4: need like there's really barely any requirements to be able

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Speaker 4: to take it.

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Speaker 3: You don't have to have a college degree.

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Speaker 4: I don't think you have to have a high schoo

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Speaker 4: you don't have to have a high school degree.

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Speaker 3: So I was like, well, let's let's get started.

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Speaker 2: You go, Yeah, starting young and clearly obviously something that

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Speaker 2: you like, you enjoy.

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Speaker 1: There's I'm curious to you.

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Speaker 2: You started talking about tax law and offering tax advice

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Speaker 2: on social media talk to me about your thoughts on

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Speaker 2: other advice, specifically in the tax realm that you find

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Speaker 2: maybe on social media, on Instagram and on YouTube. I'm

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Speaker 2: sure you've seen some really awful stuff out there. Seems

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Speaker 2: like actually sometimes you talk smack, you throw shape of

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Speaker 2: some of the other creators who are offering advice that's

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Speaker 2: less than stellar.

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Speaker 3: Yeah.

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Speaker 4: Yeah, there's a lot of bad tax advice. And that's

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Speaker 4: really how I got started. I mean, I never thought

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Speaker 4: that there would be this many people that want to

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Speaker 4: watch my stuff, So it really wasn't the goal going in.

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Speaker 3: Initially.

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Speaker 4: It was really like I kept repeating a lot of

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Speaker 4: the same advice to people. People like clients would come

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Speaker 4: to me with the wrong stuff, and a lot of

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Speaker 4: times of course where they hear it, you know, on

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Speaker 4: social media, and so I was like you just look

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Speaker 4: at it and be like, Okay, this is wrong, this

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Speaker 4: is wrong. And that's how I started. And so a

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Speaker 4: lot of the advice what I'm noticing is when people

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Speaker 4: post in their realm whatever it is, let's say their

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Speaker 4: realm is like, honestly, I've seen like a hairdresser posting

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Speaker 4: about hair, and then the minute that hairdresser posts about

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Speaker 4: tax advice.

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Speaker 3: It's like their highest viewed post.

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Speaker 1: And they're like, ooh, let me go start going in

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Speaker 1: that direction.

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Speaker 4: Yeah, So that's what I think I keep seeing, and

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Speaker 4: that's why I think a lot of times there's so

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Speaker 4: much bad advice. Like I just saw the other day,

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Speaker 4: there's one account that I don't follow, but I just

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Speaker 4: of course the tax advice.

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Speaker 3: Popped up on my feed.

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Speaker 4: Twenty million views for this one incorrect piece of advice,

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Speaker 4: and of course all the regular posts that they have

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Speaker 4: are you know, much lower, and so it's like, well,

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Speaker 4: why wouldn't you just keep doing that?

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Speaker 1: That's so fascinating, Like I'm guessing one of the I mean,

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Speaker 1: obviously there's a lot of wrong advice, and maybe that's

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Speaker 1: a part of how they're garnering all those clicks, But like,

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Speaker 1: how difficult is it to create and to dispense good

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Speaker 1: financial advice, especially on social media, because I'm guessing, like

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Speaker 1: the time constraints that oftentimes that that you're given on

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Speaker 1: social media. This is more of a media question as

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Speaker 1: opposed to a tax question. But the time constraints, given

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Speaker 1: the fact that we're just constantly being fed new things

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Speaker 1: to click on, speak to that challenge of creating content

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Speaker 1: for social media.

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Speaker 4: I initially had that thought where I thought, well, people,

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Speaker 4: you know, because I looked at the other examples of

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Speaker 4: people posting in the tax space, and honestly, they're not

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Speaker 4: they're I don't they're not posting everything that's inaccurate, but

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Speaker 4: they're doing that thing that you just mentioned where it's

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Speaker 4: like they're kind of posting things that they know like

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Speaker 4: aren't really kosher but can get clicks. And so I

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Speaker 4: thought maybe there just wasn't demand for that. But what

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Speaker 4: I found is like, I don't know, it's not that hard.

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Speaker 3: You just give accurate information.

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Speaker 4: There's actually a huge population out there that just wants

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Speaker 4: real information and sure don't be extremely boring about it,

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Speaker 4: you know. So I have done some more fun stuff,

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Speaker 4: but I haven't found that that's fully required. I think

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Speaker 4: to some extent, there's just an audience that wants to

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Speaker 4: feel like they can rely on the information.

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Speaker 2: Is it hard to give accurate information given the fact

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Speaker 2: that everyone has different different tax situation, right, So one

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Speaker 2: thing might work for one person, but the same person

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Speaker 2: might not meet the same requirement. So giving that context,

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Speaker 2: especially in a limited timeframe, is that is that hard

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Speaker 2: to pull off?

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Speaker 4: I think not anymore, you know, because I've kind of

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Speaker 4: found what works for me, and so like a really

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Speaker 4: easy way for me to do it now is is

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Speaker 4: I you know, of course part of it is the reaction, right,

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Speaker 4: so I take what someone's already explained that's inaccurate, I

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Speaker 4: very quickly say it's wrong, and then instead of having

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Speaker 4: to give a full context or explanation, it usually just

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Speaker 4: like here's a court case that said no.

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Speaker 3: And why I.

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Speaker 1: Think that's why your stuff stands out too, is like

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Speaker 1: you're you're not afraid to dive into the actual cases,

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Speaker 1: which I think a lot of folks actually aren't doing. Joel,

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Speaker 1: you mentioned context jasmine. What are some of the lowest

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Speaker 1: hanging pieces of tax saving fruit that's out there that

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Speaker 1: a lot of DII tax filers that they actually tend

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Speaker 1: to miss.

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Speaker 4: It is actually very difficult as just being an employee,

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Speaker 4: Like almost all of the tax deductions for employees were

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Speaker 4: wiped out back in twenty eighteen on the last tax reform,

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Speaker 4: So one of the biggest changes then was things like

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Speaker 4: home office and mileage and all these like expenses. A

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Speaker 4: lot of times you do have literally just zeroed out

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Speaker 4: and wiped out. So then it really comes down to

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Speaker 4: things that probably people have heard about but maybe they

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Speaker 4: don't understand enough to execute. So it really does then

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Speaker 4: go in the direction of I mean, retirement accounts would

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Speaker 4: be one option. Of course, a lot of people talk

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Speaker 4: about the short term rental loopholes, so we say loophole,

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Speaker 4: but it's literally like built into statute directly.

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Speaker 3: It wasn't inadvertent.

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Speaker 4: So that's probably the biggest opportunity for someone that is

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Speaker 4: an employee but is maybe married to someone that's not

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Speaker 4: working full time.

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Speaker 1: Is that the Augusta rule that you're talking about right there?

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Speaker 4: No, Okay, so that Augusta rule would really be exclusive

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Speaker 4: to business owners.

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Speaker 1: Okay, tell us about that short term loophole then, because

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Speaker 1: I'm not totally sure if that's something that we've talked about.

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Speaker 4: You show basically you think of like AIRBND like it was,

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Speaker 4: it's basically in statute. It's a way to have a

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Speaker 4: business that doesn't have as high of a threshold as

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Speaker 4: long term rentals. So I actually if we kind of

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Speaker 4: go back in history, right, so way back before a

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Speaker 4: couple of tax reforms, we have real estate and it

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Speaker 4: used to be just like this, the holy grail of

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Speaker 4: tax savings. So it was basically you just buy long

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Speaker 4: term rentals. Maybe you're a doctor, a lawyer making a

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Speaker 4: ton of money, and you just offset all of your

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Speaker 4: income with regular long term rentals. And what ended up happening,

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Speaker 4: of course, was then during the next tax reform Congress was.

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Speaker 3: Like, we don't like this, so we're just gonna block it.

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Speaker 4: And so then with long term rentals specifically, it's become

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Speaker 4: I don't want to say impossible, but I mean it's

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Speaker 4: really it's just a very high threshold, like you basically

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Speaker 4: have to have one out of the two spouses as

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Speaker 4: a full time real estate professional to be able to

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Speaker 4: get that same tax benefit.

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Speaker 3: That used to be much easier.

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Speaker 4: So now when we look at at the time when

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Speaker 4: that tax reform was developed, airbnb wasn't a thing, and

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Speaker 4: so it used to be really more viewed as a

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Speaker 4: full business if you had a short term rental. Now,

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Speaker 4: with it being so easy with airbnb, we're able to

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Speaker 4: use that same law that was already in place, and

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Speaker 4: it just is not subject to that special really high

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Speaker 4: threshold that we have in place for real estate. It's

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Speaker 4: like carved out as an exception where we say, okay,

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Speaker 4: we're not really going to view this as real estate,

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Speaker 4: which is typically passive and not much work.

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Speaker 3: We're actually going to view it like a regular business.

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Speaker 4: And if we're viewing it like a regular business, well

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Speaker 4: then the ability to get we call it like non

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Speaker 4: passive treatment, like active treatment, like I'm actively involved in it,

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Speaker 4: is much lower, and it ends up being one hundred

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Speaker 4: hours and more than anyone else. And that's a threshold

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Speaker 4: a lot of people can meet while being an employee.

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Speaker 2: That's okay, So there's better preferential tax treatment for running

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Speaker 2: short term rentals than there is for running long term

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Speaker 2: having long term rental properties.

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Speaker 4: Yeah, you can basically view short term rentals as like

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Speaker 4: it's just viewed like any regular business. Like if I

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Speaker 4: start an accounting firm, how do we know if I

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Speaker 4: actively participate in the accounting firm, where we say, do

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Speaker 4: I spend one hundred hours and more than anyone else?

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Speaker 4: Or do I spend more than five hundred hours in

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Speaker 4: the year. So it's a much much more reasonable threshold

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Speaker 4: to meet versus we've kind of Congress has basically blocked

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Speaker 4: that for real estate that's not a short term rental.

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Speaker 2: Okay, Yeah, I've heard about the real estate professional designation.

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Speaker 2: Matt and I are real estate investors. We don't qualify because, yeah,

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Speaker 2: we don't work more real estate than we do at

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Speaker 2: our full time job. So and I think that's where

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Speaker 2: a lot of people land on that. I'm curiouslet's talk

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Speaker 2: about maybe like just some kind of general tax advice too,

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Speaker 2: or I've heard you talk about IRS transcripts. I did

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Speaker 2: not know that this was a thing until I started

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Speaker 2: digging into your content. What are IRS transcripts and how

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Speaker 2: can they be helpful to folks who are filing taxes?

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Speaker 3: IRS transcripts are the best thing ever.

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Speaker 4: I don't know why nobody talks about them, even through accountants,

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Speaker 4: you know, and I'm I obviously speak with a lot

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Speaker 4: of accountants and.

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Speaker 3: Nobody is as excited about them as I am.

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Speaker 4: But they are literally it's a record that the IRS

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Speaker 4: has on you, and it's something that the IRS uses,

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Speaker 4: like we know that they actively use it in an

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Speaker 4: automated process. And so obviously I deal with a lot

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Speaker 4: of IRS problems and so like I would say, literally

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Speaker 4: ninety percent of the problems and IRS notices I see

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Speaker 4: are from matching your transcripts to the return, Like the

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Speaker 4: IRS will do that for you, and so it's so

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Speaker 4: so stupid not to have done it yourself. When you're

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Speaker 4: filing ahead of time.

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Speaker 2: You're a tax professional, SEA might be a bit biased,

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Speaker 2: But how would you answer somebody if they said, I

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Speaker 2: don't know, I have a pretty basic tax situation. Is

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Speaker 2: going to the tax software? Is that going to be

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Speaker 2: okay for me? Or do I really need to hire

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Speaker 2: a pro?

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Speaker 4: So it really depends, you know, to some extent that

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Speaker 4: person who's trying to hire someone you need think about,

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Speaker 4: like what your skill sets are. So I really do

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Speaker 4: think it's based on that person individually. If you're financially savvy,

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Speaker 4: then I actually think I mean, I've seen professionals do

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Speaker 4: a disservice a lot to clients in general, but especially

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Speaker 4: even smaller, simpler situations because because it's so simple, I mean,

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Speaker 4: you could literally plug it into software. So yeah, actually

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Speaker 4: I'm a huge proponent of that when it's simple, and

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Speaker 4: then the minute it gets too complex, I would say that, Yeah.

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Speaker 4: Once there's businesses people tend to they're just not looking

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Speaker 4: out for the things that they need to be looking

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Speaker 4: out for.

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Speaker 1: What is your take on the I guess it's only

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Speaker 1: new Ish at this point, But the direct file, the

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Speaker 1: IRS direct file service, Like, what are your thoughts on

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Speaker 1: that for folks who are looking to, you know, they

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Speaker 1: are looking to DIY it in comparison to some of

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Speaker 1: the other DIY filing services like TurboTax for instance.

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Speaker 4: Well, so I haven't used the direct file, I've got

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Speaker 4: to think it would be fine. So to me, I mean,

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Speaker 4: I see them as all pretty interchangeable. Where you pull

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Speaker 4: your transcripts, so I would always pull my transcripts and

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Speaker 4: then all of those software should pretty much get to

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Speaker 4: the same resolution, especially if you've got W two's ten

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Speaker 4: and nine interest, you know, as all of the basic

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Speaker 4: tax documents. I don't see any problem with it.

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Speaker 2: You said too, that when when people hire a pro,

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Speaker 2: they're often too reliant on that professional to you know,

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Speaker 2: fill out the paperwork properly. How much tax research should

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Speaker 2: we be doing as individuals and where should we turn

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Speaker 2: for that research? Makes me think of like when we're

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Speaker 2: talking about rental properties, man, people will reach in and say,

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Speaker 2: I want to I want to have a rental property,

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Speaker 2: but I'm gonna I'm going to hire a property manager

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Speaker 2: first thing, and my advice typically is that you should

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Speaker 2: manage your own property for a couple of years that

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Speaker 2: you know the questions to ask when you do eventually

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Speaker 2: hire a property a property manager. Tell me how how

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Speaker 2: you think that should check out when we're talking about

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Speaker 2: hiring someone to help you with your taxes.

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Speaker 4: Yeah, I mean, I believe in that people should understand

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Speaker 4: what you know. You have to understand something before you

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Speaker 4: delegate it. And to some extent, there are certain things

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Speaker 4: in our life that are so complicated that it's not

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Speaker 4: worth to like, maybe, you know, if I'm going to

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Speaker 4: hire an electrician, I probably don't feel like I should

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Speaker 4: understand everything before hiring that person. But I believe that,

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Speaker 4: like the finance, tax realm, it's like so critical to

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Speaker 4: us that even if you're going to delegate it to

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Speaker 4: someone awesome, you still want to have a pulse on

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Speaker 4: what's going on, And especially if your stuff is simple,

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Speaker 4: then it's like really a good idea to understand it.

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Speaker 4: So sometimes that can mean maybe you delegate it quickly,

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Speaker 4: but you have a professional that's willing to explain or

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Speaker 4: answer some of that stuff so you learn, or you

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Speaker 4: could always handle it yourself if it's on the simpler side,

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Speaker 4: and then delegate it out. But but I mean to me,

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Speaker 4: the best place to go would be the resources I'm creating,

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Speaker 4: so it'd be my YouTube channel. And then I also

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Speaker 4: have a free tax tax law community, so actual tax

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Speaker 4: law dot Com. And then I've created like a full

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Speaker 4: community with like resources. It's free, it's like people post questions.

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Speaker 4: I do monthly workshops. So I've literally just tried to

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Speaker 4: create as much accessible information as possible. And I think

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Speaker 4: that's a good idea for anyone who wants to understand

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Speaker 4: a bit of what's going on.

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Speaker 1: Jasmin is a total pro. She's getting the plug in

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Speaker 1: there before we get to the end of the episode.

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Speaker 1: Of course, we'll make sure to link to all that

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Speaker 1: in our show notes, Jasmine, so folks can know exactly

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Speaker 1: where to find you. But let's say, like, yes, you

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Speaker 1: do have a small business, Okay, your taxes are getting

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Speaker 1: a bit more complex, and we've talked about on the

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Speaker 1: show too, just even red flags that might go up

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Speaker 1: that might cause someone to say, oh, this guy is

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Speaker 1: like one of these ghost filers. He's totally gonna say

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Speaker 1: I'm completely eligible for all of these deductions and in reality,

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Speaker 1: and I'm a refund I'm going to be left holding

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Speaker 1: the bag. How should someone think about vetting a tax

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Speaker 1: pro I guess, like, are there specific questions that you

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Speaker 1: should ask them?

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Speaker 4: Yeah? I mean, well, so first off, I believe in

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Speaker 4: like you should just always assume you're going to be

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Speaker 4: left holding the bag. Okay, just to be clear, like

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Speaker 4: it's not even good bad ghosts prep whatever. I mean

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Speaker 4: not to say you can always sue an accountant, right,

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Speaker 4: but that's really what it would be, because the IRS

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Speaker 4: is going to always leave you holding the bag. And

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Speaker 4: then it's whether you then can go back on your accountant,

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Speaker 4: you know, just a separate question. I mean, as far

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Speaker 4: as vetting people, I would make sure they're licensed, which

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Speaker 4: is not a given right because you have to be

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Speaker 4: licensed to be a hairstylist. You do not have to

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Speaker 4: be licensed to prepare tax returns. So I think that's

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Speaker 4: like a bare minimum that's crazy. By the way, it

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Speaker 4: is crazy, and it's just they tried to pass it,

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Speaker 4: you know, way back, and it was deemed unconstitutional. So

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Speaker 4: it just needs to be done by Congress. The IRS

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Speaker 4: just doesn't have control over it, and so so bare

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Speaker 4: minimum licensed to write a lot of people will come

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Speaker 4: to me and they'll be like, my CPA did this

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Speaker 4: and I'm like, this CPA is not a CPA. And

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Speaker 4: by the way, they didn't even put your like put

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Speaker 4: their name on your return. It was ghost preparation right

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Speaker 4: where it's a self prepared ghost preparation super not allowed

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Speaker 4: complete violation that alone, I mean, just seeing that is like,

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Speaker 4: do not hire that person. But then I always say,

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Speaker 4: like a lot of times we have a good gut,

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Speaker 4: you know, And so in general, what I think you're

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Speaker 4: looking for is I would just like get to know

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Speaker 4: a couple of people. And to me, you're always looking

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Speaker 4: for some one that cares. Which it's just so we

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Speaker 4: can say, well, how do we know if they care,

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Speaker 4: But it's just you can tell, you know, like especially

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Speaker 4: when you have multiple options, And I would go for

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Speaker 4: the person that cares, because not only, of course do

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Speaker 4: they care more about you as a client, but the

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Speaker 4: person who cares to do a good job, right because

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Speaker 4: tax law.

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Speaker 3: Just keeps changing.

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Speaker 4: And I think that's that's what I've seen has made

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Speaker 4: the worst professionals over the years, is like someone can

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Speaker 4: say they have thirty years of experience, but if they

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Speaker 4: really weren't enjoying what they were doing and didn't really

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Speaker 4: care the whole time, they tend to just not learn

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Speaker 4: that much, and because there's there's too much to keep

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Speaker 4: up with, we just have to look stuff up. And

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Speaker 4: so if they don't really care, they're just less likely

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Speaker 4: to do a good job.

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Speaker 2: Find someone who likes taxes as much as Jasmin Dat's right,

438
00:19:44,119 --> 00:19:45,400
Speaker 2: So who's taking those classes?

439
00:19:45,480 --> 00:19:45,920
Speaker 4: Right? Right?

440
00:19:46,880 --> 00:19:50,240
Speaker 2: I'm curious to hear your take two about holistic tax planning.

441
00:19:50,320 --> 00:19:52,800
Speaker 2: I think for a lot of individuals, there seems to

442
00:19:52,840 --> 00:19:54,800
Speaker 2: be a focus on paying the least amount of tax

443
00:19:54,960 --> 00:19:57,520
Speaker 2: in the given tax year, like how can I maximize

444
00:19:57,520 --> 00:19:59,560
Speaker 2: my reflect even all the commercials like when the tax

445
00:19:59,560 --> 00:20:03,359
Speaker 2: reps off where it's all about maximizing your tax refund woohoo,

446
00:20:03,440 --> 00:20:05,440
Speaker 2: and then all the bells and whistles go off and

447
00:20:05,640 --> 00:20:08,000
Speaker 2: people are super stoked because it's more cash than their account.

448
00:20:08,119 --> 00:20:10,280
Speaker 2: How do you think about the desire that folks have

449
00:20:10,359 --> 00:20:14,400
Speaker 2: to pay less tax now versus the ability to kind

450
00:20:14,400 --> 00:20:17,399
Speaker 2: of pay pay less tax in the future, And it

451
00:20:17,560 --> 00:20:21,560
Speaker 2: just involves different choices along the way, And how do

452
00:20:21,600 --> 00:20:24,280
Speaker 2: you coach your your clients on that.

453
00:20:24,640 --> 00:20:27,840
Speaker 4: I mean, I'm always long term focused, you know, but

454
00:20:28,240 --> 00:20:31,480
Speaker 4: of course, in general, people are very susceptible to short

455
00:20:31,560 --> 00:20:34,119
Speaker 4: term gains. Right, So you think about even like I

456
00:20:34,119 --> 00:20:36,520
Speaker 4: don't know the weight loss industry, it's like more exciting

457
00:20:36,520 --> 00:20:39,160
Speaker 4: to click on, you know, six pack abs in ten

458
00:20:39,240 --> 00:20:43,320
Speaker 4: days than the alternative. But yeah, I mean that's a

459
00:20:43,320 --> 00:20:46,760
Speaker 4: really good point. With tax it's so easy for people

460
00:20:46,840 --> 00:20:49,640
Speaker 4: to sell the short term thing, and there have been

461
00:20:49,640 --> 00:20:53,040
Speaker 4: so many situations I've seen where that is adverse in general. Right,

462
00:20:53,160 --> 00:20:54,960
Speaker 4: So it's like if you knew you were going to

463
00:20:55,040 --> 00:20:58,600
Speaker 4: pay ten thousand dollars more for the next three years,

464
00:20:58,640 --> 00:21:00,680
Speaker 4: but then have a tax free sale of your business

465
00:21:00,680 --> 00:21:02,880
Speaker 4: for ten million dollars, like you would choose that all

466
00:21:02,960 --> 00:21:06,280
Speaker 4: day long, like you would choose the ten million dollars savings.

467
00:21:07,040 --> 00:21:09,040
Speaker 4: And so I've seen people make a lot of decisions

468
00:21:09,040 --> 00:21:11,520
Speaker 4: like that. It's typically more in the business owner realm,

469
00:21:11,960 --> 00:21:13,800
Speaker 4: or you could speak to retirement accounts as well the

470
00:21:13,840 --> 00:21:18,199
Speaker 4: same way. But yeah, that's to me, that's probably one

471
00:21:18,200 --> 00:21:21,119
Speaker 4: of the biggest differentiators with US versus I would say

472
00:21:21,240 --> 00:21:24,040
Speaker 4: most of this like online market, when people do sell,

473
00:21:24,400 --> 00:21:26,520
Speaker 4: it's just it's that shortcut way to sell and say,

474
00:21:26,520 --> 00:21:28,160
Speaker 4: I'm going to save you a ton of money right

475
00:21:28,240 --> 00:21:31,280
Speaker 4: this moment. But I always look at it like if

476
00:21:31,280 --> 00:21:34,000
Speaker 4: that were my business what would I want, well, to

477
00:21:34,040 --> 00:21:37,800
Speaker 4: be honest as a business owner, especially there are other considerations.

478
00:21:38,040 --> 00:21:39,880
Speaker 4: I mean, we want to reduce tax, we also want

479
00:21:39,920 --> 00:21:42,199
Speaker 4: to reduce IRIS exposure. We don't want to if I

480
00:21:42,200 --> 00:21:44,360
Speaker 4: can save twenty thousand dollars this year, but I might

481
00:21:44,359 --> 00:21:46,960
Speaker 4: get tied up in a three year long audit with

482
00:21:47,200 --> 00:21:49,439
Speaker 4: a one hundred thousand dollars bill, Like it may not

483
00:21:49,520 --> 00:21:51,919
Speaker 4: be worth it to that business owner, and so to me.

484
00:21:52,040 --> 00:21:53,840
Speaker 4: The way I do it a lot of times is

485
00:21:53,920 --> 00:21:58,320
Speaker 4: like presenting the risks and the benefits, both short and

486
00:21:58,400 --> 00:22:01,560
Speaker 4: long term. And usually and owners have different risk profiles

487
00:22:01,600 --> 00:22:02,280
Speaker 4: on what they wanted to.

488
00:22:02,600 --> 00:22:05,680
Speaker 1: Okay, well, just a second ago, you did say retirement accounts.

489
00:22:05,680 --> 00:22:09,199
Speaker 1: So on the note of a traditional or wroth, do

490
00:22:09,880 --> 00:22:12,280
Speaker 1: you have a preference, like do you lean towards one

491
00:22:12,560 --> 00:22:14,600
Speaker 1: over the other or does it truly come down to

492
00:22:14,640 --> 00:22:17,560
Speaker 1: the individual And there're personal circumstances.

493
00:22:17,920 --> 00:22:20,160
Speaker 4: I mean, my personal preference is always going to be wroth,

494
00:22:20,240 --> 00:22:24,440
Speaker 4: But that's because of assumptions I make for myself, for example,

495
00:22:24,640 --> 00:22:28,480
Speaker 4: Whereas there are some people that traditional cold can work for.

496
00:22:29,280 --> 00:22:31,720
Speaker 4: But it really it comes down to I mean for

497
00:22:31,880 --> 00:22:34,120
Speaker 4: roth right for me, Like I don't even believe in retirement.

498
00:22:34,200 --> 00:22:35,200
Speaker 3: Right, So in theory, if.

499
00:22:35,119 --> 00:22:37,480
Speaker 4: I'm going to keep working until I die, which was

500
00:22:37,480 --> 00:22:43,280
Speaker 4: hopefully three hundred years from now, then you know I

501
00:22:43,320 --> 00:22:45,399
Speaker 4: would want to do a wroth because I'm going to

502
00:22:45,400 --> 00:22:48,160
Speaker 4: be making more over time. So it always comes down

503
00:22:48,160 --> 00:22:49,920
Speaker 4: to your assumptions of where you're going to be later.

504
00:22:50,040 --> 00:22:52,639
Speaker 1: Yeah, okay, So then would the traditional apply more to

505
00:22:52,680 --> 00:22:56,520
Speaker 1: somebody who has maybe a more earthly understanding of their mortality,

506
00:22:57,359 --> 00:22:58,240
Speaker 1: not just that.

507
00:22:58,400 --> 00:23:02,359
Speaker 4: I think traditional is for someone that probably does not

508
00:23:02,400 --> 00:23:04,679
Speaker 4: only expects to retire, but then expects to really not

509
00:23:05,000 --> 00:23:07,000
Speaker 4: make as much. Right, I don't think those are the

510
00:23:07,000 --> 00:23:10,119
Speaker 4: same thing, because exactly in theory, if you're in if

511
00:23:10,160 --> 00:23:13,520
Speaker 4: you're investing, you're building assets, you're building value, you very

512
00:23:13,560 --> 00:23:15,560
Speaker 4: well may be in a higher you really should be

513
00:23:15,600 --> 00:23:18,359
Speaker 4: in a higher tax bracket later. And then we're also

514
00:23:18,400 --> 00:23:20,400
Speaker 4: betting on what's Congress going to do. You know, they're

515
00:23:20,400 --> 00:23:23,360
Speaker 4: going to increase tax rates, which is usually our assumption

516
00:23:23,480 --> 00:23:26,320
Speaker 4: is probably it's going to go up, not down. So

517
00:23:26,359 --> 00:23:28,840
Speaker 4: you'd really have to just know that when you retire,

518
00:23:28,920 --> 00:23:31,680
Speaker 4: you're going to be making a lot less than whatever

519
00:23:31,720 --> 00:23:34,919
Speaker 4: you're currently doing today, and even then you're still giving

520
00:23:35,000 --> 00:23:38,920
Speaker 4: up control over your money, which is not my favorite thing.

521
00:23:39,119 --> 00:23:41,159
Speaker 4: And of course I see the back end of it,

522
00:23:41,200 --> 00:23:43,680
Speaker 4: which is when we prep returns. I see the number

523
00:23:43,680 --> 00:23:47,639
Speaker 4: of people that need access to their money and just

524
00:23:47,840 --> 00:23:51,640
Speaker 4: take the penalty. And it's just really the worst case scenario.

525
00:23:52,160 --> 00:23:54,400
Speaker 4: They take the money, they need it, they have the penalty,

526
00:23:54,640 --> 00:23:56,480
Speaker 4: and then of course you get taxed in that year,

527
00:23:56,560 --> 00:23:59,240
Speaker 4: so it throws up their tax bracket for all these

528
00:23:59,240 --> 00:24:01,480
Speaker 4: other years when they lower tax brackets, and then the

529
00:24:01,560 --> 00:24:04,080
Speaker 4: year they withdraw it all in one it's a huge

530
00:24:04,160 --> 00:24:07,440
Speaker 4: high tax bracket. So it's really worst case scenario. And

531
00:24:07,840 --> 00:24:10,240
Speaker 4: you know, so really evaluating whether losing that control of

532
00:24:10,240 --> 00:24:11,400
Speaker 4: your money is also worth it.

533
00:24:11,520 --> 00:24:13,879
Speaker 1: Okay, quick, find a little follow up here. What kind

534
00:24:13,920 --> 00:24:17,120
Speaker 1: of situations do you see folks in where they are saying, hey,

535
00:24:17,480 --> 00:24:20,800
Speaker 1: actually like we do need to tap that traditional retirement

536
00:24:20,800 --> 00:24:23,359
Speaker 1: account where they are kind of getting that triple whammy

537
00:24:23,480 --> 00:24:23,960
Speaker 1: in effect.

538
00:24:24,520 --> 00:24:25,280
Speaker 3: It just varies.

539
00:24:25,359 --> 00:24:27,480
Speaker 4: I mean, I would say the most common probably is

540
00:24:27,520 --> 00:24:30,480
Speaker 4: related to business or investment. People make some type of

541
00:24:30,520 --> 00:24:32,840
Speaker 4: decision that they want to they need to invest in

542
00:24:32,960 --> 00:24:35,359
Speaker 4: their business, they want to start a business. It's usually

543
00:24:35,600 --> 00:24:37,199
Speaker 4: they think, oh I'm going to make more, you know,

544
00:24:37,200 --> 00:24:39,640
Speaker 4: but you take such a hit, so that's.

545
00:24:39,480 --> 00:24:42,520
Speaker 2: One or metically they need a lump some and they

546
00:24:42,560 --> 00:24:44,280
Speaker 2: take it from the wrong place, not thinking about the

547
00:24:44,280 --> 00:24:45,160
Speaker 2: tax consequences.

548
00:24:45,240 --> 00:24:46,840
Speaker 4: Yeah, I mean a lot of them are aware of

549
00:24:46,840 --> 00:24:47,960
Speaker 4: the tax consequences.

550
00:24:48,000 --> 00:24:50,000
Speaker 1: It's just to them, it's just going to be worth it.

551
00:24:50,320 --> 00:24:52,439
Speaker 2: Yeah, all right, We've got more to get to with you, Jasmine.

552
00:24:52,440 --> 00:24:55,560
Speaker 2: We're going to talk about trying to avoid IRS tax onits.

553
00:24:55,560 --> 00:24:58,320
Speaker 2: We're also going to talk about filing an extension, why

554
00:24:58,320 --> 00:25:00,840
Speaker 2: that might be a good idea for a whole lot

555
00:25:00,840 --> 00:25:02,760
Speaker 2: of tax filers. We'll get through that and more with

556
00:25:02,880 --> 00:25:12,280
Speaker 2: Jazmin Dlucci right after this, we are.

557
00:25:12,240 --> 00:25:16,040
Speaker 1: Back from the break talking with Jasmine Delucci. And Jasmine,

558
00:25:16,040 --> 00:25:17,800
Speaker 1: I am kind of curious if you just rolled your

559
00:25:17,800 --> 00:25:20,120
Speaker 1: eyes when we reached out to you about talking about

560
00:25:20,160 --> 00:25:22,720
Speaker 1: tax stuff, so that this is going to kind of

561
00:25:22,720 --> 00:25:24,400
Speaker 1: publish not too it seem like the kind of person

562
00:25:24,400 --> 00:25:27,720
Speaker 1: who rolls over. I mean, is there anything that folks

563
00:25:27,720 --> 00:25:30,040
Speaker 1: can do by the time this episode comes out, Like,

564
00:25:30,080 --> 00:25:32,760
Speaker 1: are there any actual helpful tax maneuvers that folks can

565
00:25:32,800 --> 00:25:33,960
Speaker 1: make now? Or is it just too late?

566
00:25:34,680 --> 00:25:38,040
Speaker 4: I mean it's definitely limited, you know, So I would

567
00:25:38,040 --> 00:25:41,119
Speaker 4: say things like, I mean retirement accounts always an option,

568
00:25:42,520 --> 00:25:45,000
Speaker 4: but that's gonna be the main one, especially for employees. Otherwise,

569
00:25:45,040 --> 00:25:47,680
Speaker 4: most things economically need to happen in the year.

570
00:25:48,000 --> 00:25:51,600
Speaker 2: Okay, and so we're starting to think about tax planning

571
00:25:52,040 --> 00:25:55,440
Speaker 2: for your twenty twenty five taxes, not twenty twenty four

572
00:25:55,480 --> 00:25:57,119
Speaker 2: taxes necessarily at this point in the.

573
00:25:57,160 --> 00:25:58,000
Speaker 3: Year pretty much.

574
00:25:58,080 --> 00:25:59,520
Speaker 1: Yeah, okay. What's your take on.

575
00:25:59,760 --> 00:26:03,720
Speaker 2: Tax refunds because some people say that's an interest free

576
00:26:03,760 --> 00:26:04,320
Speaker 2: loan to the government.

577
00:26:04,359 --> 00:26:05,000
Speaker 1: Why would you do that?

578
00:26:05,040 --> 00:26:08,640
Speaker 2: Other people say, man, it's like this deferred method of savings.

579
00:26:08,640 --> 00:26:12,479
Speaker 2: It helps me jumpstart other financial goals because I don't know,

580
00:26:12,680 --> 00:26:15,080
Speaker 2: it's kind of surprise money coming out of nowhere. I'm

581
00:26:15,119 --> 00:26:17,800
Speaker 2: not really thinking about it most of the time. How

582
00:26:17,800 --> 00:26:20,600
Speaker 2: do you help your clients think about tax refunds and

583
00:26:20,800 --> 00:26:22,119
Speaker 2: whether they're beneficial or not.

584
00:26:22,359 --> 00:26:25,479
Speaker 4: Well, so, most of my clients are business owners, so

585
00:26:26,600 --> 00:26:29,920
Speaker 4: they are usually paying in, not usually getting much of

586
00:26:29,960 --> 00:26:33,920
Speaker 4: a refund. And so I mean, in general for them

587
00:26:33,920 --> 00:26:35,520
Speaker 4: to have gotten a refund, we would have had to

588
00:26:35,560 --> 00:26:37,480
Speaker 4: tell them to pay too much because they're going to

589
00:26:37,480 --> 00:26:39,720
Speaker 4: ask us like how much to pay in, So we don't.

590
00:26:39,760 --> 00:26:40,320
Speaker 3: We don't do that.

591
00:26:40,359 --> 00:26:43,240
Speaker 4: We tell them to pay in what they're required to

592
00:26:43,280 --> 00:26:47,040
Speaker 4: pay in. I do always ask for their preference, but

593
00:26:47,080 --> 00:26:50,679
Speaker 4: most people that are a business owner answer that they

594
00:26:50,720 --> 00:26:53,080
Speaker 4: want to pay in the least possible to avoid penalties.

595
00:26:53,080 --> 00:26:54,880
Speaker 4: They don't usually answer that like I want to pay

596
00:26:54,920 --> 00:26:58,960
Speaker 4: in extra. It's usually more like the employee side, where

597
00:26:59,720 --> 00:27:02,280
Speaker 4: the the withholdings is automatic through your W two, so

598
00:27:02,320 --> 00:27:04,160
Speaker 4: they might want to withhold just a little bit extra

599
00:27:04,240 --> 00:27:05,280
Speaker 4: for that peace of mind.

600
00:27:05,880 --> 00:27:09,800
Speaker 1: Are for those employees? Do you ever see scenarios where

601
00:27:09,880 --> 00:27:12,879
Speaker 1: someone actually does owe the IRS a whole lot of money?

602
00:27:13,200 --> 00:27:15,040
Speaker 1: They've got a bill. I don't know if that's an

603
00:27:15,040 --> 00:27:16,680
Speaker 1: accurate way to think about it. You've got a bill

604
00:27:16,720 --> 00:27:18,560
Speaker 1: that's due to the IRS. But are there options for

605
00:27:18,640 --> 00:27:20,159
Speaker 1: some of those folks out there who might have a

606
00:27:20,240 --> 00:27:22,000
Speaker 1: large sum that they don't have the cash on hand

607
00:27:22,080 --> 00:27:23,199
Speaker 1: to take care of.

608
00:27:23,480 --> 00:27:25,639
Speaker 4: Yes, yeah, so you can do a payment plan with

609
00:27:25,640 --> 00:27:28,800
Speaker 4: the IRS. So it all it's always d you in April, right,

610
00:27:28,840 --> 00:27:30,680
Speaker 4: so that's when your taxes do you. It doesn't feel

611
00:27:30,720 --> 00:27:33,800
Speaker 4: like that because people extend, but that's an extension to file,

612
00:27:33,960 --> 00:27:37,320
Speaker 4: not to pay and so. But yeah, if you want

613
00:27:37,320 --> 00:27:40,439
Speaker 4: to either those a couple options. Sometimes people will just

614
00:27:40,520 --> 00:27:45,400
Speaker 4: wait to file until October knowing that they already owe

615
00:27:45,400 --> 00:27:47,160
Speaker 4: the money but they don't have it. So you can

616
00:27:47,200 --> 00:27:49,439
Speaker 4: wait until the IRS knows that you have the money

617
00:27:49,480 --> 00:27:51,320
Speaker 4: and then just pay it with your return. At that point,

618
00:27:51,359 --> 00:27:55,440
Speaker 4: it's just going to come with penalties and interest. Alternatively,

619
00:27:55,560 --> 00:27:58,000
Speaker 4: you can set up a payment plan. It takes a

620
00:27:58,040 --> 00:28:00,119
Speaker 4: little bit of work to set up the IRS. It

621
00:28:00,160 --> 00:28:03,239
Speaker 4: doesn't make anything too easy, but if you set that up,

622
00:28:03,280 --> 00:28:05,680
Speaker 4: it's actually at a little bit less of a pain

623
00:28:06,040 --> 00:28:08,520
Speaker 4: like a penalty as far as the penalties that are

624
00:28:08,520 --> 00:28:10,000
Speaker 4: basically accruing for late payment.

625
00:28:10,480 --> 00:28:13,760
Speaker 2: You seem to be a proponent of people filing extensions,

626
00:28:14,119 --> 00:28:16,200
Speaker 2: and like you just said, you still have to pay

627
00:28:16,359 --> 00:28:21,080
Speaker 2: your expected tax bill on by April fifteenth even if

628
00:28:21,119 --> 00:28:24,119
Speaker 2: you're filing the extension. But why why do you like

629
00:28:24,160 --> 00:28:26,520
Speaker 2: for people to have that extra time and why do

630
00:28:26,560 --> 00:28:29,040
Speaker 2: you encourage people to go with the extension?

631
00:28:29,440 --> 00:28:31,359
Speaker 4: Yeah, so, I mean the main reason is to be

632
00:28:31,440 --> 00:28:34,840
Speaker 4: able to check your IRS transcripts. So if you don't extend,

633
00:28:35,400 --> 00:28:37,879
Speaker 4: your transcripts are just not going to be fully populated.

634
00:28:38,280 --> 00:28:39,880
Speaker 4: But if you do extend, you'll have a chance to

635
00:28:39,960 --> 00:28:41,720
Speaker 4: check your transcripts. So to me, I would say the

636
00:28:41,760 --> 00:28:44,560
Speaker 4: ideal scenario is you get everything together in the beginning

637
00:28:44,600 --> 00:28:46,719
Speaker 4: of the year. You can even have your return prepped

638
00:28:46,720 --> 00:28:49,000
Speaker 4: in the beginning of the year so you know exactly

639
00:28:49,080 --> 00:28:51,680
Speaker 4: what you owe, go ahead and pay it in if

640
00:28:51,680 --> 00:28:55,720
Speaker 4: you owe, and then extend, check your transcripts and then file.

641
00:28:56,360 --> 00:28:59,480
Speaker 2: And that's essentially to make sure you're not filing a

642
00:28:59,560 --> 00:29:02,680
Speaker 2: non inclining information that the IRS has so you can

643
00:29:03,000 --> 00:29:05,280
Speaker 2: so you can. It's like it's like double checking your work.

644
00:29:05,480 --> 00:29:07,240
Speaker 3: Yeah, exactly, very nice.

645
00:29:07,320 --> 00:29:10,400
Speaker 1: Okay, let's talk about getting trouble with the IRS. Should

646
00:29:10,440 --> 00:29:12,719
Speaker 1: normal folks out there, should they be worried about getting

647
00:29:13,000 --> 00:29:15,440
Speaker 1: audited by the IRS? Like you talked about this three

648
00:29:15,520 --> 00:29:18,680
Speaker 1: year tax battle, maybe like one hundred thousand dollars bill

649
00:29:18,720 --> 00:29:21,200
Speaker 1: that comes due to attorneys that you might have to hire.

650
00:29:21,240 --> 00:29:23,720
Speaker 1: In my heart, like, how do you ensure that this

651
00:29:23,800 --> 00:29:25,040
Speaker 1: is something that you can avoid?

652
00:29:25,640 --> 00:29:28,080
Speaker 3: I mean, you can never guarantee that you won't.

653
00:29:27,920 --> 00:29:31,800
Speaker 4: Get audited, but make it less likely, yeah, I mean

654
00:29:31,920 --> 00:29:33,400
Speaker 4: as far as less likely. I mean, I would say

655
00:29:33,440 --> 00:29:36,920
Speaker 4: the biggest audit trigger that I see all the time

656
00:29:37,160 --> 00:29:39,920
Speaker 4: is reporting a huge loss on a schedule. See that

657
00:29:40,080 --> 00:29:43,440
Speaker 4: is like basically just like just ask just like beg

658
00:29:43,480 --> 00:29:45,719
Speaker 4: for an audit. If you if you want one just

659
00:29:45,760 --> 00:29:48,080
Speaker 4: like slap, especially if you want to put no income

660
00:29:48,160 --> 00:29:49,920
Speaker 4: in the gross receipts line and then just put like

661
00:29:49,960 --> 00:29:52,680
Speaker 4: negative fifty thousand. I mean, your your return will be

662
00:29:52,680 --> 00:29:53,480
Speaker 4: pulled so fast.

663
00:29:53,480 --> 00:29:56,280
Speaker 2: I told does it all the time though, But then

664
00:29:56,320 --> 00:29:58,040
Speaker 2: I just moved to South America and it's all time.

665
00:29:58,080 --> 00:29:59,080
Speaker 1: I guess he's just gotten lucky.

666
00:29:59,160 --> 00:30:01,880
Speaker 4: Yeah, I'm sure there are some people that don't get audited,

667
00:30:01,920 --> 00:30:04,480
Speaker 4: but man, that is it's tracked so closely because the

668
00:30:04,760 --> 00:30:06,200
Speaker 4: number of things that it affects.

669
00:30:06,280 --> 00:30:06,440
Speaker 3: Right.

670
00:30:06,480 --> 00:30:09,240
Speaker 4: So, for example, I was involved in a case where

671
00:30:09,440 --> 00:30:11,400
Speaker 4: it wasn't the audit of the individual. This one was

672
00:30:11,440 --> 00:30:14,800
Speaker 4: actually because they tracked preparers as well. And so they

673
00:30:14,880 --> 00:30:18,520
Speaker 4: tracked this prepare a lot of times. The reason they

674
00:30:18,560 --> 00:30:21,560
Speaker 4: do a schedule see that's a loss or that is

675
00:30:21,560 --> 00:30:24,440
Speaker 4: really like it looks like a fake business is it

676
00:30:24,480 --> 00:30:27,480
Speaker 4: generates the earned income credit. So for this preparer, he

677
00:30:27,560 --> 00:30:30,080
Speaker 4: basically the ratio of the number of people that had

678
00:30:30,120 --> 00:30:34,000
Speaker 4: scheduled see losses and earned income credits was so high

679
00:30:34,200 --> 00:30:37,360
Speaker 4: that they knew it was probably fake it and let's

680
00:30:37,400 --> 00:30:40,680
Speaker 4: be honest, it was, and so they they audited him

681
00:30:40,760 --> 00:30:43,440
Speaker 4: actually in this case. But oh, interesting but that's the

682
00:30:43,520 --> 00:30:46,200
Speaker 4: number one thing I see. And so if you're going

683
00:30:46,280 --> 00:30:48,360
Speaker 4: to have a loss, make it, make it an escort.

684
00:30:48,440 --> 00:30:49,880
Speaker 3: Probably it would be one often.

685
00:30:50,400 --> 00:30:53,440
Speaker 2: So what is actually involved in an audit as someone

686
00:30:53,520 --> 00:30:56,720
Speaker 2: who thankfully has not been audited and we're hoping that

687
00:30:56,760 --> 00:31:00,800
Speaker 2: trend continues for our business too, what what is involved

688
00:31:00,840 --> 00:31:02,200
Speaker 2: in that? And how painful is it?

689
00:31:02,200 --> 00:31:06,640
Speaker 4: It's pretty painful, Like anything with the irs, it's inconsistent.

690
00:31:06,960 --> 00:31:09,000
Speaker 4: So I'm sure there are I mean, there are some

691
00:31:09,160 --> 00:31:11,920
Speaker 4: audits where I'm like, surprisingly, I'm like, wow, this one

692
00:31:12,280 --> 00:31:12,880
Speaker 4: wasn't bad.

693
00:31:14,240 --> 00:31:15,760
Speaker 3: But that's more the exception.

694
00:31:17,000 --> 00:31:21,360
Speaker 4: In general, it's it's just such an administratively terrible process.

695
00:31:21,840 --> 00:31:23,120
Speaker 3: So it's like best case scenario.

696
00:31:23,160 --> 00:31:26,280
Speaker 4: A lot a lot of the times is literally just

697
00:31:26,840 --> 00:31:30,040
Speaker 4: you wasting just like a catastrophic amount of time doing

698
00:31:30,120 --> 00:31:32,880
Speaker 4: like just receipt dumping. You know, you're just going back

699
00:31:32,880 --> 00:31:35,480
Speaker 4: and forth, giving a ton of documents. Sometimes the auditors

700
00:31:35,560 --> 00:31:38,400
Speaker 4: just ignore the documents. Sometimes they just like it's not

701
00:31:38,440 --> 00:31:40,520
Speaker 4: in a format that they like, and so they ignore

702
00:31:40,560 --> 00:31:44,240
Speaker 4: them again. And so if you don't like that result,

703
00:31:45,160 --> 00:31:47,720
Speaker 4: then we just taking it further just takes a lot

704
00:31:47,720 --> 00:31:49,440
Speaker 4: of time, So we go to appeals, we go to

705
00:31:49,480 --> 00:31:51,400
Speaker 4: IRS Council, and a lot of times I'm taking some

706
00:31:51,440 --> 00:31:54,320
Speaker 4: of the stupidest arguments to appeals and IRIS Council because

707
00:31:54,320 --> 00:31:57,400
Speaker 4: the lower level auditor just don't I don't want to

708
00:31:57,440 --> 00:31:59,200
Speaker 4: like they're not bad people, but it's just like you know,

709
00:31:59,200 --> 00:32:01,480
Speaker 4: they got the checkli and it's not on there.

710
00:32:01,760 --> 00:32:05,440
Speaker 1: Yeah, just making your life hard. So let's talk about businesses,

711
00:32:05,480 --> 00:32:07,880
Speaker 1: because business owners obviously they have the ability to deduct

712
00:32:07,920 --> 00:32:10,800
Speaker 1: certain expenses that normal folks can't. Sounds like this is

713
00:32:11,080 --> 00:32:14,040
Speaker 1: more your specialty, jasmine, But talk to us about that

714
00:32:14,120 --> 00:32:16,440
Speaker 1: different treatment, Like what are some of the common deductions

715
00:32:16,440 --> 00:32:19,280
Speaker 1: that business owners are eligible for, Maybe some deductions that

716
00:32:19,280 --> 00:32:22,000
Speaker 1: they're leaving on the table that yeah, they really could

717
00:32:22,000 --> 00:32:23,320
Speaker 1: call back some of those tax dollars.

718
00:32:23,800 --> 00:32:25,600
Speaker 4: I mean, so as far as deductions, So I know

719
00:32:25,640 --> 00:32:27,440
Speaker 4: the way a lot of people paint it is like

720
00:32:27,480 --> 00:32:30,080
Speaker 4: they'll say, oh, there's like these you know, number of

721
00:32:30,120 --> 00:32:32,840
Speaker 4: pages in the tax code or number of deductions, Like

722
00:32:33,920 --> 00:32:37,200
Speaker 4: it's really not like that. There's no like limit limited number.

723
00:32:37,480 --> 00:32:41,760
Speaker 4: So business owner, we've got the oversighted statute that everyone

724
00:32:41,800 --> 00:32:43,480
Speaker 4: likes to points to you, right one sixty two a

725
00:32:43,800 --> 00:32:46,800
Speaker 4: ordinary necessary business expenses. So that's I mean, that's literally

726
00:32:46,880 --> 00:32:51,040
Speaker 4: the rule. So there's not like a limited number of deductions.

727
00:32:51,080 --> 00:32:54,160
Speaker 4: It really comes down to what you need for your

728
00:32:54,160 --> 00:32:58,480
Speaker 4: business is probably a deduction. And then because certain areas

729
00:32:58,520 --> 00:33:02,320
Speaker 4: are subject to abuse, we do have certain limitations on

730
00:33:02,360 --> 00:33:04,880
Speaker 4: a lot of those personal items. And so that's where

731
00:33:04,880 --> 00:33:07,160
Speaker 4: a lot of my content ends up being focused around,

732
00:33:07,160 --> 00:33:10,560
Speaker 4: because everyone that posts just quotes the statute and ignores

733
00:33:10,600 --> 00:33:13,680
Speaker 4: all of the rest of the law. But there's not

734
00:33:13,720 --> 00:33:15,320
Speaker 4: really a limit, it really is. I mean that's why

735
00:33:15,400 --> 00:33:16,880
Speaker 4: when you think of things like cell phone, it's not

736
00:33:16,920 --> 00:33:19,800
Speaker 4: like there's some special cell phone statute that tells us

737
00:33:19,840 --> 00:33:21,920
Speaker 4: that your cell phone's deductible. It's just the fact that

738
00:33:22,160 --> 00:33:24,600
Speaker 4: if you can prove your business use of it, then

739
00:33:24,640 --> 00:33:25,320
Speaker 4: you can deduct it.

740
00:33:25,680 --> 00:33:29,200
Speaker 2: So what are the biggest misconceptions then about deductions and

741
00:33:29,920 --> 00:33:31,320
Speaker 2: how do people tend to screw that up?

742
00:33:32,520 --> 00:33:36,160
Speaker 4: I Mean, the biggest one that I see is people

743
00:33:36,200 --> 00:33:39,920
Speaker 4: reading the statute saying ordinary and necessary and then they're like, oh, well,

744
00:33:40,000 --> 00:33:43,080
Speaker 4: I think, you know insert here is ordinary and necessary.

745
00:33:43,120 --> 00:33:46,640
Speaker 4: You know, I think I needed to go I'm trying

746
00:33:46,640 --> 00:33:48,080
Speaker 4: to think of like the most ridiculous I needed to

747
00:33:48,120 --> 00:33:49,920
Speaker 4: go to the gym to be really fit, so I

748
00:33:49,960 --> 00:33:51,840
Speaker 4: see like things like that, right, which kind of makes

749
00:33:51,840 --> 00:33:54,480
Speaker 4: sense logically if you're like a personal trainer and so

750
00:33:54,560 --> 00:33:58,040
Speaker 4: you start using your brain, which is not how taxile works.

751
00:33:58,480 --> 00:33:59,400
Speaker 3: So I see a lot of that.

752
00:33:59,600 --> 00:34:00,960
Speaker 4: There's like a lot of like, you know, well, this

753
00:34:01,000 --> 00:34:03,360
Speaker 4: person's on OnlyFans, so they get to deduct all their

754
00:34:03,360 --> 00:34:07,240
Speaker 4: cosmetic procedures and so you know, we just we have

755
00:34:07,360 --> 00:34:09,239
Speaker 4: law in place, we have court cases in place that

756
00:34:09,600 --> 00:34:11,719
Speaker 4: tell us the answer, and a lot of those personal items.

757
00:34:12,120 --> 00:34:14,800
Speaker 1: What's tricky though, is that like there are certain things

758
00:34:14,840 --> 00:34:17,919
Speaker 1: that we like, certain expenses we incur as individuals that

759
00:34:18,160 --> 00:34:21,520
Speaker 1: are ordinary and necessary to like human living. So for instance,

760
00:34:21,560 --> 00:34:24,640
Speaker 1: like meals, right, it's like, no matter what to survive,

761
00:34:24,880 --> 00:34:27,399
Speaker 1: like you probably have to eat lunch. And so I've

762
00:34:27,400 --> 00:34:32,400
Speaker 1: seen it discussed where if it's beyond what's ordinary and necessary,

763
00:34:32,480 --> 00:34:34,520
Speaker 1: like so for instance, when it comes to a meal,

764
00:34:34,560 --> 00:34:37,719
Speaker 1: it's like, okay, would you have already purchased that, well, yeah,

765
00:34:37,719 --> 00:34:41,680
Speaker 1: sure to just not be hungry in order to be healthy.

766
00:34:41,840 --> 00:34:44,480
Speaker 1: But if it's something that's like special, so for instance,

767
00:34:44,480 --> 00:34:46,040
Speaker 1: if it's a fancy lunch where you're going to take

768
00:34:46,040 --> 00:34:48,880
Speaker 1: a client out, like I've seen you even cite a

769
00:34:48,920 --> 00:34:51,960
Speaker 1: certain court case where it's like, well, you're not going

770
00:34:52,040 --> 00:34:53,640
Speaker 1: to be expected to go there with your mom's peanut

771
00:34:53,680 --> 00:34:55,680
Speaker 1: butter or not your mom, but like the peanut butter

772
00:34:55,719 --> 00:34:58,839
Speaker 1: and jelly sandwich I made immediately reverted back to high

773
00:34:58,840 --> 00:35:02,680
Speaker 1: school days, but like it's expected that you would partake

774
00:35:02,719 --> 00:35:05,239
Speaker 1: in that lunch as well to not be weird. So, like,

775
00:35:05,719 --> 00:35:09,160
Speaker 1: it's an interesting dynamic. How on one hand, if it's

776
00:35:09,239 --> 00:35:12,320
Speaker 1: ordinary and necessary to the exp operation of the business,

777
00:35:12,360 --> 00:35:15,279
Speaker 1: it's it's like, yes, you're allowed to deduct that, but

778
00:35:15,360 --> 00:35:19,719
Speaker 1: basically it needs to be above ordinary and necessary on

779
00:35:19,840 --> 00:35:21,839
Speaker 1: like a personal standpoint in order for it to even

780
00:35:21,880 --> 00:35:24,000
Speaker 1: be considered. Is that maybe a helpful way to think

781
00:35:24,000 --> 00:35:24,359
Speaker 1: about it.

782
00:35:24,520 --> 00:35:26,560
Speaker 4: Yeah, So the way the tax court sees it is

783
00:35:26,640 --> 00:35:30,040
Speaker 4: they see two statutes that are conflicting. So we've got

784
00:35:30,040 --> 00:35:33,040
Speaker 4: one sixty two A ordinary necessary business expenses, and then

785
00:35:33,080 --> 00:35:35,880
Speaker 4: we have two sixty two A, which is that personal

786
00:35:35,960 --> 00:35:39,040
Speaker 4: family living expenses are not deductible. Yeah, So that's the

787
00:35:39,080 --> 00:35:41,839
Speaker 4: way they approached in all their cases, where they say, well,

788
00:35:41,840 --> 00:35:44,680
Speaker 4: there's these two conflicting statutes and they've they've had to

789
00:35:44,719 --> 00:35:47,919
Speaker 4: just draw a line depending on the type of expense, say,

790
00:35:48,400 --> 00:35:51,040
Speaker 4: you know, at some point this is just and that's

791
00:35:51,080 --> 00:35:53,440
Speaker 4: that term, right, inherently personal. At some point, this is

792
00:35:53,480 --> 00:35:57,200
Speaker 4: so inherently personal that we're just not even if you

793
00:35:57,400 --> 00:36:00,439
Speaker 4: show that, like you talked about business at lunch, it's

794
00:36:00,480 --> 00:36:04,000
Speaker 4: like you were gonna eat and so usually with those

795
00:36:04,000 --> 00:36:07,200
Speaker 4: types of things, it just comes down to abuse. Honestly,

796
00:36:07,320 --> 00:36:08,719
Speaker 4: it's like, why do they do this? I think to

797
00:36:08,760 --> 00:36:11,719
Speaker 4: some extent it's just to prevent abuse, and so with

798
00:36:11,800 --> 00:36:12,920
Speaker 4: things like food, it.

799
00:36:13,080 --> 00:36:15,600
Speaker 3: Just don't it.

800
00:36:15,600 --> 00:36:17,799
Speaker 4: It's like, you know, it's the what's the phrase, like

801
00:36:18,160 --> 00:36:19,960
Speaker 4: pigs get bad, the hugs get slaughtered.

802
00:36:20,000 --> 00:36:21,000
Speaker 3: It's kind of like that.

803
00:36:21,480 --> 00:36:24,759
Speaker 2: So you want to like the abuse of those deductions,

804
00:36:24,880 --> 00:36:26,920
Speaker 2: is that more likely to trigger an audit? If you

805
00:36:27,000 --> 00:36:29,800
Speaker 2: are getting a little too greedy with some of the

806
00:36:29,840 --> 00:36:30,560
Speaker 2: things you're claiming.

807
00:36:30,719 --> 00:36:33,120
Speaker 4: I wouldn't say necessarily to trigger it, but once you're

808
00:36:33,160 --> 00:36:34,520
Speaker 4: in the audit to lose.

809
00:36:34,360 --> 00:36:35,759
Speaker 1: Yeah, okay, gotcha.

810
00:36:36,400 --> 00:36:38,359
Speaker 2: Something else you made a video about recently, You talked

811
00:36:38,360 --> 00:36:42,000
Speaker 2: about family business travel, and that's something else where people

812
00:36:42,000 --> 00:36:44,719
Speaker 2: can get caught up on the wrong side of kind

813
00:36:44,719 --> 00:36:47,440
Speaker 2: of the whole deduction thing. How how can people know

814
00:36:47,440 --> 00:36:51,120
Speaker 2: if like a family trip, a vacation is deductible or not,

815
00:36:51,480 --> 00:36:54,839
Speaker 2: and like what if you're mixing business and personal? How

816
00:36:54,880 --> 00:36:55,759
Speaker 2: how do people think through that?

817
00:36:55,800 --> 00:36:58,120
Speaker 4: I mean it, you know, my answer is always like

818
00:36:58,120 --> 00:37:00,400
Speaker 4: what is the what does the tax law say? You know,

819
00:37:00,480 --> 00:37:02,680
Speaker 4: especially for something like travel, it's not so much I

820
00:37:02,719 --> 00:37:05,399
Speaker 4: think when we default to like our gut reaction, like oh,

821
00:37:05,400 --> 00:37:07,759
Speaker 4: I think this is really business related, it's just not

822
00:37:08,600 --> 00:37:12,480
Speaker 4: just off base. You know, in something like travel. IRC

823
00:37:12,640 --> 00:37:16,080
Speaker 4: two seventy four is so extensive. It is because travel

824
00:37:16,160 --> 00:37:18,799
Speaker 4: is such a high abuse area. You know, Congress is

825
00:37:18,840 --> 00:37:22,200
Speaker 4: aware of that, so they literally created extreme amounts of

826
00:37:22,280 --> 00:37:26,600
Speaker 4: statute for so many different situations. So when it comes

827
00:37:26,640 --> 00:37:28,840
Speaker 4: to travel, it would literally be like what are the requirements?

828
00:37:28,840 --> 00:37:31,640
Speaker 4: And that's why in that video specifically I did that's

829
00:37:31,680 --> 00:37:34,120
Speaker 4: one narrow area of two seventy four, Like two seventy four.

830
00:37:34,120 --> 00:37:37,840
Speaker 4: I'm about to do more videos because there's there's so much.

831
00:37:38,080 --> 00:37:40,880
Speaker 4: It's like depending on the situation, if it's international conference

832
00:37:41,160 --> 00:37:43,640
Speaker 4: that's under literally has a separate statute, then if it's

833
00:37:43,640 --> 00:37:47,279
Speaker 4: a domestic conference, so every area is different. But for

834
00:37:47,920 --> 00:37:51,760
Speaker 4: bringing your family on family trips, we've got two seventy

835
00:37:51,760 --> 00:37:56,239
Speaker 4: four M three, so we've got a specific statute that

836
00:37:56,280 --> 00:37:57,959
Speaker 4: literally tells us it's a three part test.

837
00:37:58,000 --> 00:37:59,000
Speaker 3: We have three requirements.

838
00:37:59,280 --> 00:38:01,840
Speaker 4: Have to be an employer of your business, not a

839
00:38:02,040 --> 00:38:04,719
Speaker 4: board of director ten onion in contractor, but have to

840
00:38:04,760 --> 00:38:09,359
Speaker 4: be an employee. They have to do bonafide business work. Right,

841
00:38:09,440 --> 00:38:13,200
Speaker 4: so that of course, again it always the danger is

842
00:38:13,200 --> 00:38:15,479
Speaker 4: always like you interpret it yourself. So you go, oh, yeah,

843
00:38:15,480 --> 00:38:17,400
Speaker 4: like it was super necessary for them to be like

844
00:38:17,480 --> 00:38:19,759
Speaker 4: they're you know, they were chit chatting with my colleagues.

845
00:38:20,040 --> 00:38:22,880
Speaker 4: But what we know from court cases is that's not

846
00:38:23,000 --> 00:38:29,160
Speaker 4: considered bonafide business. And so then that more substantive work

847
00:38:29,200 --> 00:38:31,759
Speaker 4: really for the business. And then it goes to if

848
00:38:31,760 --> 00:38:34,520
Speaker 4: it would if it would have otherwise been deductible had

849
00:38:34,520 --> 00:38:36,319
Speaker 4: you not been there. But I guess if you're if

850
00:38:36,320 --> 00:38:38,239
Speaker 4: you're trying to go like not tax law and just

851
00:38:38,360 --> 00:38:40,200
Speaker 4: have you said like how to think about it?

852
00:38:40,280 --> 00:38:43,200
Speaker 3: I mean, would you do it for not your family?

853
00:38:43,920 --> 00:38:46,040
Speaker 1: That's all a good threshold, yeah, a good filter to

854
00:38:46,080 --> 00:38:49,000
Speaker 1: kind of run it through. All right, Jasmine, we are.

855
00:38:49,120 --> 00:38:51,120
Speaker 1: We've got some more topics to get to, like passing

856
00:38:51,160 --> 00:38:54,720
Speaker 1: wealth along to your kids, the tax treatment of those

857
00:38:54,880 --> 00:39:04,960
Speaker 1: assets will get to that more. Right after this we're back.

858
00:39:04,960 --> 00:39:09,080
Speaker 2: We're still talking with Jasmine Deluci talking about taxes. Jasmine,

859
00:39:09,120 --> 00:39:12,919
Speaker 2: one one question I have for you is there's so

860
00:39:13,000 --> 00:39:17,280
Speaker 2: many commercials out there, especially this time of year, claiming

861
00:39:17,320 --> 00:39:21,320
Speaker 2: that these companies can help you navigate I R S issues,

862
00:39:21,920 --> 00:39:24,359
Speaker 2: And man, I feel like even on your channel, you've

863
00:39:24,360 --> 00:39:28,200
Speaker 2: talked to people who have hired the wrong person to

864
00:39:28,280 --> 00:39:30,759
Speaker 2: help them interface with the IRS, and it's just led

865
00:39:30,800 --> 00:39:33,080
Speaker 2: to a lot of pain, a lot of wasted money.

866
00:39:33,360 --> 00:39:36,880
Speaker 2: How how do you help people think through those claims

867
00:39:36,920 --> 00:39:39,080
Speaker 2: that like, hey, just pay us a bunch and we'll

868
00:39:39,120 --> 00:39:40,600
Speaker 2: solve your IRS tax problem.

869
00:39:40,880 --> 00:39:43,640
Speaker 4: Yeah, it's the number one I mean, that's a huge

870
00:39:43,680 --> 00:39:48,040
Speaker 4: scam industry. I'd be very careful of anybody claiming that

871
00:39:48,080 --> 00:39:51,440
Speaker 4: they're definitely going to reduce your burden. I mean, the

872
00:39:51,760 --> 00:39:53,680
Speaker 4: thing about it is, I know a lot of times

873
00:39:53,760 --> 00:39:55,799
Speaker 4: people use like the fear of the I R S right,

874
00:39:56,120 --> 00:39:58,279
Speaker 4: And I do think there are concerns about the fact

875
00:39:58,280 --> 00:40:02,000
Speaker 4: that the IRS is difficult to work with, administratively frustrating

876
00:40:02,040 --> 00:40:06,560
Speaker 4: to work with, but they're not typically malicious, and so

877
00:40:06,840 --> 00:40:09,680
Speaker 4: things like trying to get rid of your tax debt

878
00:40:10,000 --> 00:40:12,680
Speaker 4: to some extent you qualify or you don't, and really

879
00:40:12,680 --> 00:40:17,080
Speaker 4: the person you want on your team is someone that's

880
00:40:17,400 --> 00:40:20,040
Speaker 4: again going back to like caring, right, someone that cares

881
00:40:20,080 --> 00:40:22,400
Speaker 4: to actually help you and is going to going to

882
00:40:22,760 --> 00:40:24,560
Speaker 4: be with you to get through what is a very

883
00:40:24,560 --> 00:40:28,200
Speaker 4: administratively difficult process, and a lot of times it really

884
00:40:28,239 --> 00:40:30,400
Speaker 4: those companies, you know, they take all their money up front,

885
00:40:30,400 --> 00:40:32,919
Speaker 4: so why would they still care, you know, six months later,

886
00:40:32,960 --> 00:40:36,320
Speaker 4: because that process is going to take I mean typically

887
00:40:36,400 --> 00:40:37,560
Speaker 4: a year at least a year.

888
00:40:38,040 --> 00:40:40,080
Speaker 1: How how much of your business or how much of

889
00:40:40,080 --> 00:40:43,360
Speaker 1: your time do you spend defending clients or working on

890
00:40:43,640 --> 00:40:45,400
Speaker 1: these on these audits.

891
00:40:45,520 --> 00:40:46,719
Speaker 3: I spend a good amount of time.

892
00:40:47,280 --> 00:40:50,279
Speaker 4: To me, I view it as it's like I want

893
00:40:50,280 --> 00:40:53,000
Speaker 4: to stay up to date on everything the IRS is doing,

894
00:40:53,040 --> 00:40:54,840
Speaker 4: and it's so inconsistent that I have to have a

895
00:40:54,840 --> 00:40:57,440
Speaker 4: lot of data entry points to see exactly what's going on.

896
00:40:58,160 --> 00:40:59,759
Speaker 4: So I do it is one of my favorite things

897
00:41:00,200 --> 00:41:03,040
Speaker 4: time on. Okay, Yeah, So the ones that I spend

898
00:41:03,040 --> 00:41:05,640
Speaker 4: time on are usually I like to spend time on

899
00:41:05,680 --> 00:41:08,000
Speaker 4: the ones that it's a dispute. So it's a lot

900
00:41:08,040 --> 00:41:09,719
Speaker 4: of time, Like the tax is at dispute, so an

901
00:41:09,760 --> 00:41:12,360
Speaker 4: IRS audit would be an example, or it's an IRS

902
00:41:12,360 --> 00:41:14,759
Speaker 4: notice that's incorrect, right, So we're trying to remove a

903
00:41:14,760 --> 00:41:18,160
Speaker 4: couple hundred thousand dollars in tax For example, I don't

904
00:41:18,200 --> 00:41:19,200
Speaker 4: spend so much time.

905
00:41:19,680 --> 00:41:22,319
Speaker 3: My partner actually does. My dad he spends.

906
00:41:22,000 --> 00:41:25,160
Speaker 4: Time on the ones where you owe the irs but

907
00:41:25,200 --> 00:41:26,680
Speaker 4: you can't afford to pay them.

908
00:41:26,680 --> 00:41:28,920
Speaker 1: Got it, man, Okay, So Jasmine loves it. She's a

909
00:41:28,920 --> 00:41:32,719
Speaker 1: glutton for punishment, that's what she's saying. Going back, so

910
00:41:32,920 --> 00:41:34,799
Speaker 1: you were you kind of touched on this a second ago,

911
00:41:35,400 --> 00:41:39,000
Speaker 1: how you expect taxes essentially to go up in the future.

912
00:41:39,040 --> 00:41:40,479
Speaker 1: It's part of why you're a fan of the wrath

913
00:41:40,560 --> 00:41:43,160
Speaker 1: is that because of the fact that you're just looking

914
00:41:43,200 --> 00:41:45,600
Speaker 1: at the numbers and you're like, these numbers don't compute,

915
00:41:45,640 --> 00:41:47,719
Speaker 1: and so therefore you're like, all right, taxes have to

916
00:41:47,760 --> 00:41:48,040
Speaker 1: go up.

917
00:41:48,120 --> 00:41:51,560
Speaker 4: Well, I mean historically tax rates have been higher, and

918
00:41:51,640 --> 00:41:55,640
Speaker 4: it's usually easier to pass tax increases than tax decreases,

919
00:41:55,680 --> 00:41:56,279
Speaker 4: it seems like.

920
00:41:56,320 --> 00:41:57,920
Speaker 3: So that's more of just a guess.

921
00:41:57,800 --> 00:42:00,239
Speaker 2: Yeah, and well I guess even right now, we're we're

922
00:42:00,320 --> 00:42:02,640
Speaker 2: kind of at a point where we're going to have

923
00:42:02,680 --> 00:42:05,279
Speaker 2: some sort of new tax law no matter what. Right,

924
00:42:05,320 --> 00:42:07,759
Speaker 2: either the tax cuts, tax cuts and Job Act will

925
00:42:07,800 --> 00:42:12,400
Speaker 2: be extended or it'll sunset. And and maybe it's not extended,

926
00:42:12,440 --> 00:42:14,359
Speaker 2: maybe there's some new formulation. Like how do you think

927
00:42:14,400 --> 00:42:17,319
Speaker 2: about the uncertainty around tax law right now?

928
00:42:18,480 --> 00:42:20,120
Speaker 4: I don't know if I think about it too much.

929
00:42:20,200 --> 00:42:22,520
Speaker 4: For me, it's it's I know that tax law is

930
00:42:22,560 --> 00:42:25,040
Speaker 4: just going to keep changing. It's like just the way

931
00:42:25,400 --> 00:42:27,960
Speaker 4: people seem to be wired. There's always special interest. It's

932
00:42:27,960 --> 00:42:30,640
Speaker 4: such a political topic that I just make the assumption

933
00:42:30,840 --> 00:42:33,360
Speaker 4: like every five years or four years now at this point,

934
00:42:34,160 --> 00:42:36,040
Speaker 4: there's going to be a lot of new stuff for

935
00:42:36,080 --> 00:42:38,200
Speaker 4: me to learn, and so that that's really the way

936
00:42:38,200 --> 00:42:40,160
Speaker 4: I approach it, just like very logically, I'm like, if

937
00:42:40,239 --> 00:42:42,240
Speaker 4: I just stay up to date, then I can always

938
00:42:42,239 --> 00:42:43,279
Speaker 4: maximize what we've got.

939
00:42:43,840 --> 00:42:46,120
Speaker 1: Yeah, that makes sense. It's honestly probably a good way

940
00:42:46,160 --> 00:42:48,160
Speaker 1: to think about it. It's like a moving target for sure. Yeah,

941
00:42:48,160 --> 00:42:51,799
Speaker 1: well that's just the formature it takes. And yeah, it's

942
00:42:51,840 --> 00:42:54,799
Speaker 1: constantly it's ever evolving, which is oftentimes why like there's

943
00:42:54,800 --> 00:42:56,400
Speaker 1: not a whole lot of times that we say to

944
00:42:57,280 --> 00:43:00,239
Speaker 1: considering hiring a professional, but specifically with it when it

945
00:43:00,239 --> 00:43:02,239
Speaker 1: comes to tax law, it is constantly changing. There are

946
00:43:02,239 --> 00:43:04,040
Speaker 1: so many nuances. I don't know how many numbers and

947
00:43:04,120 --> 00:43:07,759
Speaker 1: letters that you stated so far during this conversation, But

948
00:43:07,880 --> 00:43:09,920
Speaker 1: like it's so much to keep up with, and it

949
00:43:09,960 --> 00:43:12,000
Speaker 1: pertains too how much it is that you're going to

950
00:43:12,040 --> 00:43:13,600
Speaker 1: end up paying taxes a lot of money. It's take

951
00:43:13,640 --> 00:43:16,120
Speaker 1: too in your business. But for folks out there who

952
00:43:16,239 --> 00:43:19,480
Speaker 1: are looking further ahead off into the future, generational wealth

953
00:43:19,520 --> 00:43:21,080
Speaker 1: is what we're talking about here, Like what's the best

954
00:43:21,080 --> 00:43:23,720
Speaker 1: way you think to pass on wealth alone to future

955
00:43:23,760 --> 00:43:27,960
Speaker 1: generations Because obviously, I mean we've talked about before retirement accounts,

956
00:43:28,120 --> 00:43:32,480
Speaker 1: they don't have that step up basis. How can folks

957
00:43:32,640 --> 00:43:35,240
Speaker 1: have that to where their kids, folks who are inheriting

958
00:43:35,239 --> 00:43:37,240
Speaker 1: that money pay the least amountain taxes possible.

959
00:43:37,320 --> 00:43:39,759
Speaker 4: It's the best options always real estate, And so real

960
00:43:39,840 --> 00:43:43,160
Speaker 4: estate has such a strong lobby. We've got such favorable

961
00:43:43,600 --> 00:43:46,480
Speaker 4: tax laws for real estate, and I think that'll just

962
00:43:46,520 --> 00:43:50,440
Speaker 4: continue no matter whenever I see tax reform, Like the

963
00:43:50,520 --> 00:43:52,480
Speaker 4: real estate lobby is just so strong. They find a

964
00:43:52,520 --> 00:43:55,440
Speaker 4: way to weasel into even things that weren't intended for

965
00:43:55,480 --> 00:43:58,960
Speaker 4: them at all. And so with real estate, I mean,

966
00:43:58,960 --> 00:44:02,000
Speaker 4: the classic thing is you obviously purchase real estate. We

967
00:44:02,040 --> 00:44:04,919
Speaker 4: know it goes up in value, but the tax law

968
00:44:05,239 --> 00:44:07,880
Speaker 4: actually gives us credit as if it goes down in value,

969
00:44:08,160 --> 00:44:11,120
Speaker 4: which is a great payoff. And then as long as

970
00:44:11,120 --> 00:44:13,640
Speaker 4: you just don't sell it, let your kids inherit it,

971
00:44:13,680 --> 00:44:15,319
Speaker 4: you get the step up in basis and you can

972
00:44:15,360 --> 00:44:17,920
Speaker 4: just keep playing that game, you know, forever.

973
00:44:18,040 --> 00:44:20,480
Speaker 2: Brilliant Love it, Jasmine. Thank you so much for taking

974
00:44:20,480 --> 00:44:22,239
Speaker 2: the time to join us on how to Money today.

975
00:44:22,239 --> 00:44:24,560
Speaker 2: Where can our listeners find out more about you and

976
00:44:24,560 --> 00:44:25,480
Speaker 2: the content you're creating?

977
00:44:25,600 --> 00:44:28,520
Speaker 4: Yeah, either on my YouTube so at tax leverage or

978
00:44:28,880 --> 00:44:31,000
Speaker 4: I also have actual tax law dot com.

979
00:44:31,040 --> 00:44:33,040
Speaker 3: I created totally free community.

980
00:44:33,400 --> 00:44:35,759
Speaker 4: There's no I'm not like upselling people or it's not

981
00:44:35,840 --> 00:44:37,120
Speaker 4: some like you know, I mean a lot of times

982
00:44:37,120 --> 00:44:39,600
Speaker 4: people create free stuff that's not really helpful. But this

983
00:44:39,719 --> 00:44:42,960
Speaker 4: is really just me trying to provide free value for

984
00:44:43,000 --> 00:44:44,480
Speaker 4: a lot of people that I feel like a lot

985
00:44:44,480 --> 00:44:46,959
Speaker 4: of times are hiring the wrong help, or not hiring help,

986
00:44:47,040 --> 00:44:50,279
Speaker 4: or just like often left in a worse position than

987
00:44:50,280 --> 00:44:50,759
Speaker 4: they should be.

988
00:44:51,320 --> 00:44:53,680
Speaker 1: Very cool. We'll link to all that, Jasmine. Thank you

989
00:44:53,719 --> 00:44:54,920
Speaker 1: so much for talking with us today.

990
00:44:54,960 --> 00:44:58,040
Speaker 2: Of course, thank you guys, all right, Matt that that

991
00:44:58,080 --> 00:45:00,800
Speaker 2: was a great conversation. I feel like Asmin is smarter

992
00:45:01,000 --> 00:45:03,560
Speaker 2: than I could ever hope to be, and I think

993
00:45:03,560 --> 00:45:06,400
Speaker 2: you have to be when it comes well, everyone's got

994
00:45:06,480 --> 00:45:10,239
Speaker 2: to be, like it's it's not a hard I guess

995
00:45:10,280 --> 00:45:11,200
Speaker 2: hurdle to jump over.

996
00:45:11,280 --> 00:45:13,759
Speaker 1: Now you've got to be pretty buttoned up, especially when

997
00:45:13,760 --> 00:45:16,000
Speaker 1: it comes to the details, especially when it comes to

998
00:45:16,040 --> 00:45:18,920
Speaker 1: some of the like the business law or the business

999
00:45:18,960 --> 00:45:22,240
Speaker 1: tax sort of sector of when it comes to tax planning.

1000
00:45:22,719 --> 00:45:23,759
Speaker 1: Was your the big TAKEO.

1001
00:45:23,840 --> 00:45:26,279
Speaker 2: I was going to say that intersection of passion and

1002
00:45:27,400 --> 00:45:29,560
Speaker 2: like she's goin, yeah, she's I think I've ever.

1003
00:45:29,440 --> 00:45:32,479
Speaker 1: Talked to anybody who was as excited about tax law.

1004
00:45:33,000 --> 00:45:35,880
Speaker 1: No ass me neither the fact that she's yeah, she's like,

1005
00:45:35,880 --> 00:45:39,040
Speaker 1: I'm either working or I'm working out something. Actually, I'm

1006
00:45:39,080 --> 00:45:41,520
Speaker 1: glad you pushed her on. Come on, like, what's something

1007
00:45:41,800 --> 00:45:44,120
Speaker 1: that you The others are going to say that this

1008
00:45:44,280 --> 00:45:47,200
Speaker 1: is a dumb use of your money, not just for

1009
00:45:47,239 --> 00:45:48,160
Speaker 1: you furthering educator.

1010
00:45:48,160 --> 00:45:50,040
Speaker 2: I think it's like, I don't know, I love what

1011
00:45:50,080 --> 00:45:51,960
Speaker 2: we do, and there are elements that I would be

1012
00:45:51,960 --> 00:45:55,399
Speaker 2: doing of this job, whether or not I got paid.

1013
00:45:55,440 --> 00:45:57,520
Speaker 2: Like I'm just fascinated by personal finance. So I get that.

1014
00:45:57,560 --> 00:45:59,359
Speaker 2: I get that, although I don't know if I'm as

1015
00:45:59,440 --> 00:46:02,200
Speaker 2: into it as as she is into Texas. But okay,

1016
00:46:02,200 --> 00:46:04,239
Speaker 2: so I think my big takeaway from this conversation happened

1017
00:46:04,320 --> 00:46:06,160
Speaker 2: right there at the end where she's talking about the

1018
00:46:06,200 --> 00:46:09,560
Speaker 2: benefits of real estate when trying to transfer generational wealth,

1019
00:46:09,600 --> 00:46:11,279
Speaker 2: and you and I we talk about real estate. We've

1020
00:46:11,280 --> 00:46:14,360
Speaker 2: actually become less keen on pushing people towards investing in

1021
00:46:14,360 --> 00:46:17,080
Speaker 2: rental real estate in recent years, given that it's just

1022
00:46:17,120 --> 00:46:18,560
Speaker 2: more difficult financially.

1023
00:46:18,120 --> 00:46:18,640
Speaker 1: To pull off.

1024
00:46:18,880 --> 00:46:21,360
Speaker 2: But I think that's actually a really good point to

1025
00:46:22,239 --> 00:46:25,799
Speaker 2: highlight here, is that if one of your key financial

1026
00:46:25,840 --> 00:46:29,440
Speaker 2: goals is to leave an inheritance for the next generation,

1027
00:46:29,960 --> 00:46:32,160
Speaker 2: the best way to do it from a tax standpoint

1028
00:46:32,480 --> 00:46:34,640
Speaker 2: is to invest in rental real estate. So if that

1029
00:46:35,000 --> 00:46:37,439
Speaker 2: goal of investing in real estate is a super long

1030
00:46:37,520 --> 00:46:38,799
Speaker 2: term thing, if you're like, I'm going to own this

1031
00:46:38,840 --> 00:46:41,920
Speaker 2: thing until I die and I want my kids to

1032
00:46:42,000 --> 00:46:44,960
Speaker 2: inherit it, I think then it's beneficial from multiple standpoints.

1033
00:46:45,000 --> 00:46:47,680
Speaker 2: You're minimizing the transaction costs obviously of buying real estate.

1034
00:46:47,920 --> 00:46:49,520
Speaker 2: You get to see the appreciation, you get to get

1035
00:46:49,520 --> 00:46:52,160
Speaker 2: the cash flow, and then you get to pass that

1036
00:46:52,400 --> 00:46:57,240
Speaker 2: asset onto your children where that value gets reset exactly

1037
00:46:57,320 --> 00:46:59,680
Speaker 2: which is pretty great. One of the coolest things about

1038
00:46:59,800 --> 00:47:02,719
Speaker 2: real state, and every time it's so funny. I was

1039
00:47:02,719 --> 00:47:05,959
Speaker 2: thinking about a property that I own that I'm having

1040
00:47:06,000 --> 00:47:07,600
Speaker 2: to clean it up and find a new tenant, and

1041
00:47:07,600 --> 00:47:10,480
Speaker 2: it just is kind of a pain. It's like my

1042
00:47:10,560 --> 00:47:12,680
Speaker 2: least favorite time when I have to turn over that

1043
00:47:12,719 --> 00:47:15,239
Speaker 2: property because it just requires more effort. And I was like,

1044
00:47:15,280 --> 00:47:18,000
Speaker 2: you know what, my kids will be thankful that I

1045
00:47:18,080 --> 00:47:18,640
Speaker 2: held on to it.

1046
00:47:18,680 --> 00:47:19,040
Speaker 1: Someday.

1047
00:47:19,120 --> 00:47:21,160
Speaker 2: I can sell it right now and pay the tax,

1048
00:47:21,200 --> 00:47:23,640
Speaker 2: but hey, this is a long term investment, and just

1049
00:47:23,680 --> 00:47:25,880
Speaker 2: because this is a pain today doesn't mean it's not

1050
00:47:25,880 --> 00:47:28,360
Speaker 2: going to hopefully pay off in spades tomorrow. Came in,

1051
00:47:28,400 --> 00:47:30,440
Speaker 2: don't by tomorrow, I mean like that, like, yeah, ye, don't,

1052
00:47:30,440 --> 00:47:31,400
Speaker 2: don't hit that easy button.

1053
00:47:31,440 --> 00:47:32,719
Speaker 1: That's what I was going to say. When it comes

1054
00:47:32,760 --> 00:47:35,160
Speaker 1: to thinking about that. My big takeaway is going to

1055
00:47:35,160 --> 00:47:38,000
Speaker 1: be when she was talking about the risk associated with

1056
00:47:38,080 --> 00:47:40,720
Speaker 1: taking different deductions, and I think this applies to whether

1057
00:47:40,880 --> 00:47:44,120
Speaker 1: you are in an individual or a business, And essentially

1058
00:47:44,160 --> 00:47:45,600
Speaker 1: what I heard her say was that just because you

1059
00:47:45,640 --> 00:47:48,200
Speaker 1: can take a certain deduction doesn't mean you should. And

1060
00:47:48,440 --> 00:47:51,240
Speaker 1: I think when like it immediately made me think about

1061
00:47:51,280 --> 00:47:55,360
Speaker 1: investing for your future. And just because you can invest

1062
00:47:55,400 --> 00:47:57,680
Speaker 1: all of your money in crypto doesn't mean you should

1063
00:47:57,719 --> 00:48:00,640
Speaker 1: do that. And in fact that there's I would say,

1064
00:48:00,640 --> 00:48:03,839
Speaker 1: a higher likelihood of there being a worse outcome were

1065
00:48:03,840 --> 00:48:05,400
Speaker 1: you to do that. So I don't know. I just

1066
00:48:05,440 --> 00:48:09,160
Speaker 1: like that overall takeaway. Just because you can, that doesn't

1067
00:48:09,200 --> 00:48:10,360
Speaker 1: necessarily mean that you should.

1068
00:48:11,040 --> 00:48:13,560
Speaker 2: But yeah, I mean, I guess if you put it

1069
00:48:13,560 --> 00:48:16,200
Speaker 2: all on crypto, or if you had five years ago,

1070
00:48:16,280 --> 00:48:19,920
Speaker 2: people would say, Matt, that I would have crushed. But

1071
00:48:19,960 --> 00:48:21,879
Speaker 2: there's still there's still so much more risk.

1072
00:48:21,920 --> 00:48:23,359
Speaker 1: I think there's a lot more folks who have lost

1073
00:48:23,400 --> 00:48:25,680
Speaker 1: a tremendous amount of money though kind of messing around

1074
00:48:25,960 --> 00:48:28,839
Speaker 1: with something specifically like crypto. But all right, our beer

1075
00:48:28,880 --> 00:48:31,479
Speaker 1: that you and I enjoyed during this episode was a

1076
00:48:31,560 --> 00:48:36,120
Speaker 1: sequench ale, which I think we're supposed to read as sequential.

1077
00:48:36,640 --> 00:48:39,800
Speaker 1: Oh okay, you think so? Maybe, Like I'm trying to

1078
00:48:39,800 --> 00:48:41,799
Speaker 1: tie it back to the numbers a little bit. This

1079
00:48:41,840 --> 00:48:43,880
Speaker 1: is a beer by dogfish Head. What are your thoughts here?

1080
00:48:43,920 --> 00:48:44,160
Speaker 1: All right?

1081
00:48:44,200 --> 00:48:47,560
Speaker 2: So this was I thought light refreshing, It was briny,

1082
00:48:47,840 --> 00:48:48,880
Speaker 2: had some live action.

1083
00:48:48,719 --> 00:48:50,399
Speaker 1: Going on, It has some salt, for sure. Man.

1084
00:48:50,640 --> 00:48:52,239
Speaker 2: It was almost like the beer equivalent of a low

1085
00:48:52,320 --> 00:48:54,520
Speaker 2: key margarita and so.

1086
00:48:55,160 --> 00:48:57,799
Speaker 1: But even less boozy. Yeah, like it was more like

1087
00:48:57,920 --> 00:49:01,400
Speaker 1: lemon lied lemon lime Gatorade is yeah, yeah, yeah because

1088
00:49:01,400 --> 00:49:04,560
Speaker 1: of the salt, because like that's what Gatorad and power Aye,

1089
00:49:04,560 --> 00:49:06,200
Speaker 1: that's what those drinks have going on. Right, Yeah, you're

1090
00:49:06,200 --> 00:49:08,880
Speaker 1: a runner now, like you're you're hammering some of those

1091
00:49:08,960 --> 00:49:10,759
Speaker 1: those sports drinks. Like that's what you gotta have some

1092
00:49:10,800 --> 00:49:12,400
Speaker 1: sodiums in there, that's right, that's what the guy going

1093
00:49:12,440 --> 00:49:15,000
Speaker 1: on this had, the electrolytes, it brought it. Yeah, and

1094
00:49:15,320 --> 00:49:17,480
Speaker 1: this was I thought this was really tasty. And you're

1095
00:49:17,520 --> 00:49:19,000
Speaker 1: running a race and they had this over on the side,

1096
00:49:19,000 --> 00:49:19,880
Speaker 1: would you go for some of that?

1097
00:49:19,960 --> 00:49:20,080
Speaker 4: Oh?

1098
00:49:20,120 --> 00:49:22,319
Speaker 2: For sure, probably would unless I was like going for

1099
00:49:22,320 --> 00:49:24,759
Speaker 2: a pr or something like that. But because I doubt

1100
00:49:24,760 --> 00:49:26,360
Speaker 2: a beer is gonna help me in my quest. But

1101
00:49:26,480 --> 00:49:28,200
Speaker 2: this one, this one is tasty, and I like that

1102
00:49:28,280 --> 00:49:30,040
Speaker 2: it's just kind of light and refreshing. It's not over

1103
00:49:30,080 --> 00:49:32,319
Speaker 2: the top. And I'm always a fan of kind of

1104
00:49:32,360 --> 00:49:35,239
Speaker 2: salty briny beers. I think of like Westbrooks Goza that

1105
00:49:35,320 --> 00:49:39,040
Speaker 2: being like the classic super duper briny briny beer, and uh,

1106
00:49:39,200 --> 00:49:41,120
Speaker 2: this this was like a much lighter version of that,

1107
00:49:41,520 --> 00:49:43,640
Speaker 2: but now it makes you want to go harder than.

1108
00:49:43,560 --> 00:49:45,000
Speaker 1: That direct and this is even better for something like

1109
00:49:45,040 --> 00:49:47,480
Speaker 1: the beach though, like you're sitting there like like just

1110
00:49:47,640 --> 00:49:50,520
Speaker 1: so you know, folks, we love the big, heavy craft beers,

1111
00:49:50,880 --> 00:49:52,520
Speaker 1: but that is not the kind of style you want

1112
00:49:52,520 --> 00:49:54,919
Speaker 1: when you're sitting there under a one hundred degrees sun

1113
00:49:55,200 --> 00:49:57,239
Speaker 1: around the beach. True story. All Right, that's gonna be

1114
00:49:57,280 --> 00:50:01,280
Speaker 1: it for our episode talking about tax today, Jasmine Delucchi

1115
00:50:01,400 --> 00:50:03,120
Speaker 1: will again make sure to link to some of the

1116
00:50:03,160 --> 00:50:06,080
Speaker 1: things that she mentioned up on the website at howdomoney

1117
00:50:06,080 --> 00:50:07,759
Speaker 1: dot com. Buddy, that's gonna be it for this one.

1118
00:50:07,840 --> 00:50:10,799
Speaker 1: Until next time, Best Friends Out, Best Friends Out,