The X’s & O’s

We invite Amber Storms of Collaborative Tax Partners to the podcast this week. Amber is an enrolled agent, which is the highest credential that is awarded by the IRS. She is passionate about helping her clients navigate through the complex and ever-changing tax landscape. Brent, Matthew, and Joshua discuss common mistakes Amber sees in her practice, collaborative tax planning, and some considerations to keep in mind as we approach the end of the year.

Amber’s Links:

Website: https://www.collaborativetaxpartners.com/

Email: amber@ctptax.com

Call: 877-634-3377

The Hosts:

Brent Pasqua, Matthew Theal and Joshua Winterswyk

Transcript:

Brent Pasqua: Welcome in. And we welcome to you to the Retirement Plan Playbook. We’re back in the studio, we’re here excited for another episode. Today, we have a special episode. We are going to be talking with Amber Storms from Collaborative Tax Partner, and we’re going to be going over some detailed questions about why tax planning is so important and getting your taxes done correctly, and also making sure that your tax plan and financial plan is all aligned. But before we get into that, I’m your host Brent Pasqua. I’m the founder of RPA Wealth Management. I’m here with Matthew Theal, certified financial planner, Joshua Winterswyk certified financial planner. How you doing guys?

Matthew Theal: I’m doing great. Brent. I’m really excited for today’s show. One, I love the two news headlines we have coming up, but also our first studio guest, Amber here, this is going to be a lot of fun today.

Brent Pasqua: Yeah, we had to get another mic. We purchased another mic and we have a great guest here.

Joshua Winterswyk: Big next step for the Retirement Plan Playbook. I’m excited to have Amber here and just excited to get started.

Brent Pasqua: So what are you guys doing for Thanksgiving?

Matthew Theal: I’ll be eating Turkey and mashed potatoes and kind of the run around, maybe drink a beer and have some wine and you watching a ton of football.

Brent Pasqua: I have a question for you. Do you put cranberry sauce on your Turkey?

Matthew Theal: No, I don’t put fruit on things.

Joshua Winterswyk: What about you Brent?

Brent Pasqua: No, I don’t either.

Joshua Winterswyk: Okay. So I had actually tried this like a couple Thanksgivings ago, put a little Turkey in a roll with some cranberry sauce. I always see it at the Thanksgiving table and never gave it a shot. All I’m saying is this year give it a try. Pretty good dude. A pretty good combo. You wouldn’t think so. Pretty good.

Brent Pasqua: Hopefully this year’s Thanksgiving looks a lot better than last years. Last year was kind of downer with COVID, but hopefully this year it’s a lot better.

Joshua Winterswyk: I agree. Yeah, no, definitely.

Brent Pasqua: All right. Let’s get into the headlines for the first headline and we got some good ones today. The first Bitcoin exchange traded funds started trading on Tuesday, making the most widely traded crypto currency available to most investors with the brokerage account. The fund already has over 1 billion in management and is the quickest ETF to reach that threshold. And that is according to Bloomberg data. What do you think about this new sort of ETF coming to the market and a whole new sort of asset class?

Matthew Theal: Yeah, so this was a big moment for Bitcoin is a big moment for kind of the true Bitcoin believers. And it’s a big moment for the retail investor who hasn’t gone out and got a Coinbase account to, or even a Robinhood account to purchase actual Bitcoin. Really big moment. There’s a few things I don’t like about the ETF. One being the fee. I don’t understand why you do the fee and the second being that the ETF actually doesn’t own Bitcoin. So that’s really, really important to understand it owns futures on Bitcoin and what a future is the right to purchase Bitcoin at a given time. But you’ll never get to exercise that because you’ll just hold the ETF.

Joshua Winterswyk: Given time in the future.

Matthew Theal: Yeah. Given time in the future. Exactly. Exactly. So who do I like this for? I like this for people who have retirement accounts, who can’t access Coinbase, other people though, who are trying to invest in it in brokerage accounts, I really don’t like it. Why pay 1% for Bitcoin when you could go to Coinbase, open an account in five minutes and send $500 and buy a Bitcoin that way.

Joshua Winterswyk: Yeah, those are my thoughts too. I think it’s good for the people who don’t want to learn how to use Coinbase and also just the ease, but the fee is extremely high. I think though, that this opens the door for a lot more new ETFs. And I think that that price war will help drive the price, not only baby, potentially of this ETF, but other ETFs down. So for those people who want to own it in their retirement accounts or brokerage accounts, eventually, hopefully that price does come down. And then also just what I think is Bitcoin here to stay, a lot of the haters on Bitcoin, talk about it going to zero, but I mean, it just continues to kind of get past these hurdles, continue to move forward. And I think with the launch of the ETF, it also is taking that next step of staying around for a while.

Matthew Theal: Yeah. I mean, I’ve been allocating on some of my investible assets towards cryptocurrencies over the last three and a half, four years. For a while I did like Bitcoin a lot, now I’ve kind of switched to being a little bit more bullish on Ethereum for some other reasons. But I think Bitcoin is here to stay in my opinion, it’s kind of the digital gold. I actually like it much better than gold I’d rather have a client come to me and say they want to buy Bitcoin than they want to buy gold at this point.

Brent Pasqua: So how are you handling sort of allocation percentages that someone should be putting in their, if they are working in a retirement account, IRA, Roth IRA, should they be allocating a certain percent to this new ETF?

Matthew Theal: My general rule of thumb on cryptocurrencies is no more than 10% of your net worth, for someone though who’s using their retirement funds, I’d say under 5%. You just don’t want to gamble your retirement away on something that this unproven, sure has a 10, 11 year track record, but still unproven. I mean, the stock market has a almost a hundred year track record at this point.

Joshua Winterswyk: It’s still a baby.

Brent Pasqua: Right. I mean, if somebody does want the crypto exposure, is this the way to do it? Is it through this ETF in their retirement account?

Matthew Theal: Yeah. It’s the only way to do it.

Brent Pasqua: Okay. All right. So let’s get to the next one. Former President Donald Trump announced last week that he is launching his own media company. This will include a social media platform and be partially funded by a merger with a SPAC. The SPAC known as Digital World Acquisition rose quickly in the first few days before dropping after the initial surge, the dropped happened after major hedgefunds started to sell their stake in the fund. What are your thoughts regarding the SPAC and where do you think this goes from here?

Joshua Winterswyk: There’s a lot to unpack here. This is really interesting. It kind of sums up the time. I mean, I think so in general SPAC’s trade at what, $10 a share. And then once this in news was announced, I think, did shoot up to $175 a share?

Brent Pasqua: Yeah.

Matthew Theal: And now it crashed back down to 50. So first of all, it’s kind of sad. The first reason it’s sad is because somebody bought this at a $100, $125, $175, and they’re now more than 50% underwater on this investment. We’ll go back up that high. I don’t know. Probably not, but in the other hand it kind of sign of the times, right? Here’s Donald Trump with his brand coming out here, putting it into this SPAC to create a media company. And the thing goes bonkers and it shoots up it’s no different than the dog crypto currency or the GameStop.

Joshua Winterswyk: That’s what I was thinking. It’s a meme stock, basically right now. And it’s unfortunate for anyone that did buy that. Even anything above a $100. I mean, you don’t want to see that lose that much money, but very interesting for this to be launched, to watch this price movement as well. I think, like you said, a lot to unfold here too, especially on the side of Trump’s company and where this goes from here.

Brent Pasqua: They have an idea of where they want to take the company. Right? They have a vision of a product that they want to launch. But at this point it seems like there actually obviously is no product. So they’re going to have to acquire a company that’s already has a product similar to what they’re going to want it to do with it. But right now it’s just a shell.

Matthew Theal: Right. Yeah. It’s just the company with the market cap. The one thing I will point out, super interesting, because Donald Trump got some shares in this, he is now actually considered a billionaire. So pretty cool.

Brent Pasqua: Yeah, he finally,

Matthew Theal: So he is finally a true billionaire now. I think he’s worth 20 billion and it’s all because of the SPAC now. So good for him.

Brent Pasqua: I have to imagine that this move is probably the financially best move any president has made after leaving office. I don’t think book deals actually net out this type of money.

Joshua Winterswyk: Financially, yeah. And relatively what risk did he have by doing any of this? There’s not much risk for him.

Brent Pasqua: He doesn’t need to go on the speaking tour. He doesn’t need to do the book tour. He just literally launched a fund. And he’s now a billionaire with-

Matthew Theal: I would attach my name to a fund for 20 billion. Hey, I’d do it for two.

Brent Pasqua: Yeah, me too.

Matthew Theal: If he needs SPAC promoter. Come see us.

Brent Pasqua: Yeah. Okay. So let’s get into the retirement planning corner. Today. We have our special guest with us. Amber Storms is a lead EA at Collaborative Tax Partners. We took about a year planning out our relationship and partnering up with Amber on having clients be able to have access to an EA, who’s able to do tax planning and who’s able to prepare and complete taxes, so that we can make sure that their financial plan is coordinating within their tax plan. And one of the reasons why we did that was because we had found a lot of times we were making specific recommendations within somebody’s financial plan and not everything was actually getting correctly put onto their tax return the way that it was supposed to. And so there was always sort of this disconnect between what the advisor was doing and then what the tax preparer was completing and we wanted to close that gap.

Brent Pasqua: We found so many errors that would happen that would cost people more money in taxes. We found that if we were able to close that gap, it would be a lot easier for clients. And not only that, but it just makes everything so much more seamless. We have a relationship where we can help Amber get all the documents and help the client get prepared. So we built that relationship over a long period of time. And we wanted to talk to her on this podcast to give everyone an idea of some of the reasons why we did what we did and some of the work that she does do. So, first question, I think Amber that I have for you is what made you want to start Collaborative Tax Partners?

Amber Storms: Well, first I want to say thank you for having me on today. I’m really excited to be here and really excited for our future to, with regards to Collaborative Tax Partners. The motivation is actually in the name, I’m more of a team player. And I like the idea of having a team effort, almost like we’re like the financial planning justice league. We all come together to bring our superpowers together and our expertise to yield the best status for our clients or the best results for our clients. We can’t know it all. We can only see so much from our seat in the stadium. And by partnering together with RPA, we can work together to increase savings for our clients and help them build their wealth. And on top of that, we get to keep the human element at the forefront of all that we do. Because after all this is a people business, we have to make sure that we put people first.

Matthew Theal: I love that analogy, the justice league, you like that too right Josh?

Joshua Winterswyk: That’s what I was thinking. Yeah.

Matthew Theal: I’m going to start using that.

Joshua Winterswyk: I’m going to use that too.

Brent Pasqua: What kind of clients do you typically work with and what do those relationships look like?

Amber Storms: Well, good question. I do work with a variety of clients. It could be individuals, meaning single, married, family, jointly or separately, I can also work with businesses like small businesses or even full size businesses. I do have extensive experience working with franchises and residential real estate. Also I can work with nonprofits, tax exempt organizations say, for example, the Girl Scouts or Boy Scouts. I’m very passionate just about working with our local heroes to police, fire fighters, medical professionals, because they really need our help and our foresight. Another thing I like to do too, is representation. And in case you’re not familiar with representation, that’s basically, if you get an IRS love letter or maybe a love letter from a state tax agency, I would be your advocate to help you address the issue and get that rectified.

Matthew Theal: That’s pretty brave that you actually pick up the phone and call the IRS on behalf of clients. I would not want to do that. I don’t know, that’s just an organization I don’t want to mess with.

Amber Storms: A lot of people don’t like that.

Joshua Winterswyk: So Great to know that you do provide that service because that can be a very concerning and nervous time too if you get one of those letters. So you’re saying you take care of that for clients.

Amber Storms: Exactly. And we have to keep in mind that it is a time sensitive issue. So we don’t want to hide from letter. We want to respond as soon as possible and get that taken care of. Because in the long run, you’re actually saving yourself stress, time and money too, because you’re not paying as much in interest in penalties.

Matthew Theal: I actually got a letter one time and I sent it over to my accountant at the time. It was like, “Please handle,” and then he took care of it. It’s miraculous. It was really cool. So the fact that you could do that to help our clients is going to be amazing.

Brent Pasqua: Yeah. Amber had worked with me a little while back regarding a client that sold some shares of stock that they had owned. And they had purchased many, many, many years ago before you have to actually keep the basis of those shares. And I think that that person had reported a zero basis on their tax return because they didn’t really know how to correctly report it. And then they got that lovely letter from the IRS stating that they had a tremendous amount of taxes owed. And so Amber had represented them, worked with them, got the basis corrected to what they were actually supposed to be. And then what they owed in taxes was a very small amount compared to what the IRS said.

Brent Pasqua: So representation, I wouldn’t want to call them either, I think representation of having somebody that knows what they’re doing to represent you is so critical too. And then another big area that I want to know about more. And I think a lot of people are interested in is tax planning. And tax planning, I think comes in September, October, November at this last part of the year, right, where you’re looking at the year being almost over, you’re looking at going into next year but you know you can make potentially some changes that could be helpful as you prepare to look into next year to save you some money to complete the year’s tax returns. What is tax planning and how does it benefit people?

Speaker 4: My mentor used to say, we want to take the advantage of the present value of the dollar and to take advantage of that now. And that this is an important aspect of financial planning because we want to minimize our tax liabilities, we want to save money and we want to reach life milestones. And we can’t do that if we don’t know exactly where we’re going, tax planning is also… it’s also great to have tax planning at this time of year or towards the last quarter, because now we can make course corrections. Maybe we don’t need to withhold as much, or we need to withhold more. Maybe we need to sell some stocks. There’s different things that we need to look at, so that way we can file you most advantageously and you keep more of your money in your pocket.

Brent Pasqua: I mean, how often too, do you look at and do tax planning and then communicate with the advisor regarding, “Here’s the things that you could do before the end of the year, maybe tax lost, harvest some positions in our portfolio, or just make some adjustments that can save money.” I would seem like that would happen a significant amount of times.

Amber Storms: Exactly. And that’s exactly what, that’s just an important aspect of our relationship. I received information from you and then we put our heads together to see specifically for this client and their tax circumstance. What can we do? What tax laws can we take advantage of while there’s still time to make a correction?

Joshua Winterswyk: Now off the top of my head, I would think like probably the two most important times for clients to come do it. A tax plan would probably be when they’re going under significant life change, maybe they’re getting married, maybe a new job, or they’re looking at retiring. Would you agree? And what are the kind of the best times for people to do this?

Amber Storms: Absolutely. Life change is probably the number one and like you said, either you’re purchasing a house or maybe you’re getting married, maybe you’re getting divorced. There’s a bunch of different things that could happen where your tax circumstances have changed so significantly where you’ll have to make some sort of adjustments. One of the things that makes me sad is most for taxpayers is when we don’t time these transactions properly like purchasing a house at the end of the year as opposed to the beginning of the year, or are we loss harvesting or should we straddle tax shares when we’re selling stocks, for example, or if we’re going to use loss harvesting, are we going to straddle two different tax shares so you don’t take the full burden in one year? Those are the times that we want to look at that.

Joshua Winterswyk: Yeah. That that would make a lot of sense. And then even for the clients who have those employer stock options and stuff, where they have to cash them out in certain points, you want to probably plan that out so you don’t get a big tax hit at the end of the year.

Amber Storms: Exactly.

Brent Pasqua: I think one other areas that’s important too, is if you’re getting down towards the last couple months of the year and you haven’t, you still have room to make contributions into your 401(k) plan or your work retirement plan, and you have some money saved up, you might not necessarily need that last couple paychecks for the year. You can defer that obviously into your 401(k) plan, pull the extra money that you need out of savings and use your after tax dollars, just to probably another quick way to save a few thousand dollars in taxes potentially helpful as you try to maximize your year.

Joshua Winterswyk: And I think that a tax plan can also calculate that savings for you. I think another big part of that tax plan and Amber correct me if I’m wrong, but actually finding out what your withholding should be. You have so many people that ask, what should that withholding be? How can a tax plan help with that?

Amber Storms: Yes. The great part about the… I like to remind folks that everybody’s tax return is as unique as your fingerprint, nobody’s the same nobody’s tax situation is the same. So we want to make sure we take all of these pieces to the puzzle and we take those all into consideration so we can see exactly what your taxable income is and what your tax liability is. And what can we do to minimize your tax liability.

Brent Pasqua: So how does an investment advisor like RPA help you create better tax plans for clients than just traditionally doing a tax plan?

Amber Storms: Now, this is the part that I’m most excited about. I want to touch back to our justice league partnership too, because we’re using our unique expertise to develop these very specific tax strategies. For example, you were saying with IRAs, we can work together to develop some strategic retirement planning, accelerating contributions to boost savings, or making more effective withdrawals or identifying tax efficient accounts even or transferring assets to heirs and beneficiaries. We can move certain pieces of the puzzle around to make it as advantageous as possible for our clients.

Brent Pasqua: What are also some of the year-end tax planning strategies people can take advantage of?

Amber Storms: One of my favorites that we just discussed, that lost harvesting. I always like to remind my to taxpayers to be wary of the wash-sale rules, basically, meaning that you can’t take a loss if you’re buying substantially the same stock you just sold within 30 days. Now it doesn’t apply to crypto, but that’s still in the works right now. Another year-end tax planning strategy I like to promote is donations. A lot of folks tend to low ball themselves with donations, but you don’t have to, as long as you keeping proper records and you keep an account of what you donated, yes please take the donations. Actually it could help bring down your tax rates significantly by increasing your itemized deductions.

Matthew Theal: I have a question on the donations, so when you say keep proper records, ideally in your view, what would you like to see from a client, like a spreadsheet, check, photocopies of the checks? What’s the best?

Amber Storms: Oh, great question. Spreadsheets work really well for a record keeping. And this is something you can always refer back to because there is a chance that we could be audited. Any one of us could be, there’s not a whole lot of folks working at the IRS right now. So not going to get an audited anytime soon, but in case you do, you will need this record to reflect back on and we’d want to know the date and the list of items that you did donate. If you made a cash donation, you keep a copy of the check. As long as it has the date, the entity and the amount you should be covered. I’ll also have more information on our website, collaborativetaxpartners.com, where you can actually see a checklist of things that you want to keep to fulfill your record keeping requirements.

Joshua Winterswyk: That’s awesome.

Brent Pasqua: I mean, how often, and I think the reason that we want to focus to part of these questions on tax planning is because when you get to next February or you get into March, you get into April and you’re completing people’s tax returns. It would seem like it’s very difficult at that point to go back and make too many changes because the year’s already over. How many times do you see mistakes, where you would see, if they would’ve just done this before year-end, we probably could have been in a much better position.

Amber Storms: Great question. I actually see that scenario more frequently than I would like to. Because in our day-to-day, we’re so involved in what we’re doing day-to-day. We don’t stop to think and doesn’t occur for most of us to stop and think, “Uh-oh, I need to do something with my taxes.” I see the situation too often where we’re meeting in February and now we’re scrambling to get all of these documents together. And it still is not yielding the result that we want because we didn’t take action at the proper time of the year.

Brent Pasqua: Yeah. It’s strange to me that most people don’t recognize that getting your taxes done and then doing tax planning is a multi-step thing. It’s like, yeah, you got to get your taxes completed in March or April, but you should also be doing a tax planning meeting at the end of the year. So you should really be meeting with your tax professional at least twice a year. Would you agree?

Amber Storms: Absolutely. At least twice a year. And even if you want to just send an email, just if you have a couple quick questions, just so you’ll have the peace of mind and it brings it to your preparers attention. So they’ll make a note in your file and we’ll make sure to touch base on this in the future. So you’re never left hanging.

Brent Pasqua: Is there any other big mistakes you see people make?

Amber Storms: Oh yes. Actually taxpayers forgoing, they’re electing to forgo certain deductions out of fear. But if you’re entitled to take the deduction, you have the records to back it up. Please take the deduction. There’s no rule. And I know there’s a quote for this too. There’s no rule that says you have to pay the maximum amount of tax possible. No you’re allowed to minimize your tax and we should take advantage of that rule. Also, I see a lot of taxpayers making large ticket purchases at a really bad time. Like I mentioned earlier, purchasing a house, but towards the end of the year, you don’t have the full year worth of deductions. So that’s also an issue and that can actually hurt you in the future. Just take a step back again to our tax agency love letters. A lot of folks will tend to, when they get that IRS love letter, they will tuck it back, they’ll put it under the carpet, they will hide it. But you’re not doing yourself any justice by not addressing this situation. So they will work with you, but you do have to talk to them.

Matthew Theal: That’s a good strategy, file it away and hope the problem goes away.

Brent Pasqua: Doesn’t sound like something they’ll forget about.

Joshua Winterswyk: Out of sight, out of mind man. Do you have an example of one of those deductions like you were talking about in your first statement with the mistakes?

Amber Storms: Oh, I see what you mean, to forgoing those deductions.

Joshua Winterswyk: Yeah. Yeah. Do you an example?

Amber Storms: Oh like employee business expenses, I know we can’t take those on the federal return now, but let’s use the California return because you can still take employee business expenses. Some folks will not take the full amount of whatever their allocated business cell phone is or the specific uniforms they had to purchase for work or any kind of lodging expense or going to special meetings. They’ll take a safe, I’m using the air quotes here, using a safe percentage or same as last year, but once again, that’s not doing yourself any favors.

Joshua Winterswyk: Sure. And what I’m hearing also is you probably should be keeping pretty good records. So it is accurate so you’re getting the most of that out of that deduction.

Amber Storms: Getting the most bang for your buck and you have the peace of mind knowing that it was done accurately.

Matthew Theal: My wife has always wanted a tax deduction for her Gucci sandals and shoes that she has to wear to work events. But every tax person tells her no.

Amber Storms: No, She hasn’t branded.

Matthew Theal: Yeah.

Brent Pasqua: What is the one thing our listeners can do to prepare for this tax season?

Amber Storms: One thing that actually kind of ties into the last question too, is making sure as you keep accurate records, start gathering your records now. There’s no sense in waiting till January or February when you’re under pressure to find a lot of information and then be accurate too. Making large purchases or basing financial obligations on your anticipated refund, I can’t tell you how many times taxpayers were disappointed because they’re expecting a large refund but to cover the new windows that they just purchased of the new car, but something came up where the refund is delayed or it’s been offset for another obligation. So I would definitely tell people, make sure you know exactly what’s going on with your tax account, which actually leads me into my next recommendation.

Amber Storms: Please start an IRA in a franchise tax board tax account. It’s completely free. You can log into your account, see all the returns you have filed. If you needed to refile for example, you need a copy of your tax return, you can get a copy of that. You can also see exactly what your earnings are per tax share and get a copy of your wage in income transcripts. So it just puts you as the consumer back in power and back in control of your information.

Matthew Theal: That’s such good advice for people. So I didn’t even know this existed.

Brent Pasqua: Me neither.

Matthew Theal: But when I went to go buy a house, I used my Roth IRA as down payment, but the first time home buyer, but the issue is I didn’t track my basis. My previous accountant did, but it was done so long ago. So I wanted to prove that I’d actually put in what I put in. So what I did was I went to the… I made an account just like you said, and I went there and I went back in the years and pulled my basis, printed out the paper and highlighted it and then gave it to my new accountant to use so we wouldn’t have any penalties the Roth. It’s really cool.

Amber Storms: Yes. And you covered all your basis and it’s totally worth the work, the extra steps to take care of that, completely worth it.

Matthew Theal: Yeah really cool.

Joshua Winterswyk: And I believe they even have details of what stimulus checks that you potentially received in the past. So it has a lot of information on there. I created an account and again very useful, so great recommendation.

Amber Storms: Yeah. Actually the stimulus checks, it was a really big one this past tax season because a lot of people didn’t receive the notice, the notice 1444 a or B, they didn’t receive the notice at all. So they had no idea. And a lot of people actually had to go back into their bank records to see, “when did I receive this money?” But if you have the IRS tax account, you can go in and see for yourself and put you back in control.

Brent Pasqua: I’m assuming from there too, once you have an account set up that you can go in and cross reference your wages on your tax returns to what social security says, to make sure that your social security benefits are being reflected and your incomes are being reflected correctly.

Joshua Winterswyk: Yeah. And you’ve talked about that too, about making sure that that income is being reported correctly. So great way to cross reference using those two sites.

Amber Storms: Absolutely. You make an excellent point because the social security administration just advised us that they’re discontinuing the no match letters, basically they would send out letters to certain employers to say, “Hey, this social security number does not match what we have on file. You might want to check that.” So this person’s social security earnings aren’t incorrect. SSA is not going to be doing that anymore. So if you have an IRA account, you can actually go in and see and if there’s any issues you can go ahead and make corrections or have that addressed

Matthew Theal: That could ruin your retirement if your social security is not being filed correctly.

Joshua Winterswyk: What a nightmare task to try to even get that fixed.

Matthew Theal: Imagine you worked at the same company for 30 years and it was never recorded because you had the wrong digit in your social security number?

Brent Pasqua: Or wrong and your paycheck’s 50% less.

Matthew Theal: Yeah. Wow.

Joshua Winterswyk: And then you head to go back and prove records of all that earned income. That would be a nightmare.

Brent Pasqua: No thanks. One other question I have too, that I think is important to really where some of investing is going and I think there’s this tax element that has to be always taken into consideration. So what is your experience in working with people who hold cryptocurrencies? There’s this whole new market now of people that need a file for this.

Amber Storms: That’s what’s amazing about this segment. I started working with cryptocurrency taxpayers maybe five, six years ago. And I literally had a handful of clients, maybe three. Now I’m seeing a more diverse segment of people getting into cryptocurrency. And the thing I love about this taxpayer is that they’re very enthused and they’re very engaged. And there’s a lot of different changes right now that are having through Congress and a lot of people are participating and talking about it and getting involved. I noticed one thing with cryptocurrency that has not changed. We’re still having an issues as Matt was mentioning earlier, having issues with basis tracking. Because now we’re executing these transactions, but we have no idea how much we purchased of whatever the coin was for, we have no idea. So we end up generating a higher tax liability as a result.

Matthew Theal: That’s actually true. So one thing I learned when looking at own personal Coinbase account is Coinbase isn’t tracking my basis. I mean, all my buys and sell are there, but it’s not like at Schwab where I could go on and see how much I’ve made on my Bitcoin or Ethereum. There are a couple softwares and I don’t remember what they’re called that will track it for you now that have come out in the last year, which is pretty cool. But I think there should be and this probably goes down the regulation path, rules for Coinbase where they need to hold people’s basis because I mean, that could cause a massive tax issue.

Amber Storms: Yes. A huge tax issue. And we have to have some sort of B plan too because if we’re not tracking it, yes, Coinbase should be tracking that for them. For sure.

Brent Pasqua: The other question I have is, and we’ve done podcasts on the Biden administration’s tax plan that they’re proposed to come out in possibly in 2021. And then it seems like they just this week had released in some elements and changes to another one. How do you keep up with all of these changes? Because it seems so fluid. It seems like the last couple of years you’ve had to go into the beginning of tax season and they haven’t even completely released where some of the tax changes have been and how do you keep up with all of it?

Amber Storms: Very little sleep, lots of coffee. No I’m kidding. Yeah last tax year was a nightmare. There’s always an industry joke amongst a tax professionals, “This is my last year. I can’t do it anymore.” There was quite a few professionals that said, “No for reals this time, I can’t do this.” Because it’s so much that we have to keep up on. I do belong to a number of professional organizations where I’m able to get access to the most updated law changes, not to mention staying engaged with the IRS’s website and just staying engaged in that end too.

Joshua Winterswyk: That’s outstanding. I think nowadays it just seems so complicated that they’re making changes so rapidly that there’s probably you have to be able to adjust and make changes also as those come out right away.

Amber Storms: Yes. This is something that one of the professional organizations I belonged to had mentioned, they wanted to go to Congress and say, “Hey, can we get a flat set of rules for and just keep it like that? Because the administrative burden is just too much for us practitioners and for the taxpayers.” I’m hoping Congress will listen this time.

Brent Pasqua: So if somebody wants to either do tax planning with you at the end of this year, or they want to get ready next year and get their taxes done by you, what is the best way that they can reach out to you?

Amber Storms: Excellent question. Definitely feel welcome to reach me at our website. You can schedule an appointment there at collaborativetaxpartners.com also feel welcome to send me an email too. You can reach me at amber@ctptax.com also by the phone at 877-634-3377.

Brent Pasqua: I think we’ll put that in the show notes too, right?

Matthew Theal: Yeah. We’ll put some stuff in the show notes. That’s pretty brave giving out your phone number like that. We get a lot of listens on this podcast so I hope you don’t start getting a bunch of spam calls. But also any clients who would love a connection with Amber, reach out to Brent, myself or Josh and we would love to book of time and we could all work together.

Brent Pasqua: I like how you’re able to schedule an appointment on your website. I mean, there’s nothing better nowadays and being able to go onto a website and just schedule an appointment without having to call. I don’t know if you guys feel that same way, but it’s just so much more convenient. I don’t like having to call place to schedule an appointment.

Joshua Winterswyk: Oh no, it can match to my schedule when Amber’s available. So for right there and thank you, Amber. I just think that just with this conversation you can see how fast things change, how many updates there always are. And having someone, a professional like you to help out and answer those questions can be helpful for a lot of people, so.

Brent Pasqua: Yeah, and I think failing to plan is planning to fail. So plan ahead. And if you could save money, I mean, that’s what I think is the best. I mean, do your work, do your homework, work together and that’s a good way to save money. Let’s get into the last thing of the show let’s get into RPA recommends, Matt, what do you have for us?

Matthew Theal: All right. Amber’s first recommends. I’m excited to hear what you got for us. So I’ll start us off. I’ll go with Succession. So this is the best show on TV right now. Hands down, HBO has a winner on their hands. I know for a five or six year stretch, actually it’s probably longer. Game of Thrones was dominant and that was the big franchise for HBO. Everyone was like, “What’s going to be the next game of Thrones?” It’s here. It’s not a dragon show though. It’s Succession. It’s a business show and it is incredible.

Joshua Winterswyk: I can’t keep up though, man. There’s just so many good shows.

Matthew Theal: Yeah, this one’s better than all the other ones. This show really good-

Joshua Winterswyk: High priority?

Matthew Theal: The lines, the scripting of it is just beautiful, it’s intense, but you kind of feel like you’re there in the room listening to them, the back stabbing, it’s great. Highly recommend Succession on HBO.

Joshua Winterswyk: I got to get caught up on all of these shows. I’ll go next. I know a big joke about my cell phone on this podcast. One thing I will have to say though, about this new phone. I don’t know if I mentioned it, but the new wallet from Apple that connects to the back of the phone’s like a MagSafe wallet on the new iPhones. I think the newer iPhones, the last two, game changing. Love it, holds my cards. What it also does is if the wallet gets disconnected from your phone, it alerts you and then tells you the last place you left it. A lot of people probably are like, “Hey, that wallet, if I lose it, I don’t know where it’s at,” but it’ll actually alert you to that. So pretty cool software, really enjoying it. Thanks guys for the recommend on me getting a new phone.

Matthew Theal: That’s the whole reason I haven’t bought one of those wallets that you have, because I’m like, “Oh, I’m going to lose that real fast. That’s pretty cool that it alerts you.

Joshua Winterswyk: Yeah. It alerts you. And I think it’s implementing that new tag technology too, that Apple’s launching. You could buy tags and put them on your bag, in your backpack. And it’ll let you know where you last left it. But yeah, with the Find My iPhone now, I mean, you can basically track all of your devices from an iPad to computer and login and even now your wallet.

Matthew Theal: I’m going to get a tag from my AirPod case.

Joshua Winterswyk: There you go.

Amber Storms: You read my mind.

Joshua Winterswyk: But the wallet, really cool. Really like it, check it out on their site.

Brent Pasqua: You could tell me if I’m wrong. But I used to carry some cash in my pocket, if I went into somewhere I’d just pay with cash. But once COVID hit, it seems like nobody wants to exchange cash anymore. And maybe I’m just catching up late, but maybe this just pushed it over. But literally I don’t see any use to have of cash anymore.

Joshua Winterswyk: They talked about that in the beginning of COVID about how cash just wasn’t in circulation, right? That was the scarcity on even bills and coins, even at the banks because there wasn’t just a lot of exchange of actual physical money, but yeah, I’m right there with you. It kind of seems like why carry it if no one’s accepting it.

Brent Pasqua: What do you have for Amber?

Amber Storms: All right. So taxes is a very left brain thing. And the poor right hemisphere of my brain is just has been neglected. So I said, “Okay, I need to get something artsy in my life.” So I found this website, it’s called NightCafe Studio. Basically have two options with this website. You can upload a picture that you have or you can enter in keyword and you can have AI create a picture for you based on those keywords. Now with the pictures you upload, you can add different filters to it or effects and make it look like Van Gogh or Renoir, whatever you’d like. I have spent quite a few hours developing some beautiful, beautiful pictures and it just takes me away. And I don’t have to think about bills, numbers or anything like that. It’s just been fantastic. And I strongly recommend it for anyone who just needs a just a getaway.

Matthew Theal: This sounds like a program that generates NFTs. And that sounds really cool. I’m going to have to check this out. And then maybe I’ll list my first NFT on OpenSea and become an Ethereum millionaire.

Joshua Winterswyk: Oh my goodness.

Amber Storms: Actually. Yes I remember.

Brent Pasqua: You’re entering into the metaverse.

Matthew Theal: Yeah. I’m getting in to that metaverse.

Brent Pasqua: My recommend is to save people money, do your tax planning. It’s that time of year, you don’t have a lot of time. It’s such an important aspect. There’s something about saving money for clients that I just really love no matter how much portfolio returns are and how happy they are. There’s nothing that makes me happier than watching them save a couple thousand dollars that they don’t have to pay the IRS, that just keeps money in their back pocket. I think that’s awesome. There’s no real way to do it than doing planning early. I think people take that step because once the next year starts, let me tell you it’s too late. All right. So let’s close out the show. As advisors we love helping people. That’s why we do it. If you like to schedule an appointment with any of us. Please go to rplwealth.com and schedule a complimentary consultation. You can also download our ebook on our website and if you’d like the show notes and there’s a lot of them today. Please go to retirementplanplaybook.com. Thanks for listening.

Joshua Winterswyk: Thank you. Thank you, Amber.

Matthew Theal: Thank you, Amber.

Amber Storms: Thank you so much.

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