Top Overlooked Tax Deductions, Tax Law Changes, Filing Errors and More with Ernst & Young Tax Partner, Greg Rosica

Are you planning on working on your taxes this weekend, but feeling overwhelmed? With all the tax changes that have occurred in the last year, doing the dreaded taxes can actually be an understatement for some people. For example, did you win money gambling in 2013? Did you know that you can actually write off the amount you lost when gambling as well? I sure didn’t! This is just one of the most common overlooked tax deductions, Greg Rosica, Tax Partner and contributing author to the Ernst & Young Tax Guide 2014 shared when he joined me for an interview yesterday. Greg also discussed the recent tax law changes, steps taxpayers can take to make tax filing easier, how to deal with green tax breaks, incentives, tax treatment of mutual funds, gifts and estate tax planning, the most common tax filing errors and much more!

 

 

Greg Rosica is an Ernst & Young Tax Partner contributing author to the Ernst & Young Tax Guide 2014. Photo credit: Twitter.com/GregRosica

Greg Rosica is an Ernst & Young Tax Partner contributing author to the Ernst & Young Tax Guide 2014. Photo credit: Twitter.com/GregRosica

 

 

 

 

Candace Rose: With April 15th quickly approaching, what do taxpayers need to know about the recent tax law changes?

Greg Rosica: “Candace, a lot of changes came through in the beginning of 2013 with the American Taxpayer Relief Act (or ATRA for short) and what that did was brought with it a lot of increased tax changes at different income levels. $200,000, $300,000 and at $400,000 – all of those have different tax increases that occurred, different types of taxes that come into play and that coupled with other increases that impact really anyone that gets a wage, earns a paycheck. They would have seen throughout the year a 2% increase in some of their Social Security withholdings, really and on top of that some additional itemized deduction changes – create some changes that we want to make sure people understand.

In the EY tax guide, again this year we’ve laid out what those changes are, how they’re going to impact people in different tax situations – maybe you’re a self employed individual, maybe you’re a real estate investor…we try to lay out what things you should consider in light of these tax changes and just other deductions that are out there to take advantage of.”

 

Candace Rose: What steps can taxpayers take now that can make filing taxes easier?

Greg Rosica: “I think really understanding your situation and try to seek out what kind of deductions are applicable to your situation and so in the EY Tax Guide, one of the things we have is a list of the 50 most overlooked deductions and that can help someone to go through and kind of think about whether their situation lines up with some of those items. For example, maybe they volunteer at a charity, when they attend meetings of the charity- if they drive their car there they can deduct mileage associated with that as a charitable contributions. If they buy any supplies for those meetings, those supplies can be deducted as out of pocket expenses as well. Other items – perhaps they’ve won some money gambling, you can actually deduct items that you’ve lost gambling, again, against that income, so that will minimize the amount of income that you have.”

 

Candace Rose: How do taxpayers deal with green tax breaks, incentives, tax treatment of mutual funds, gifts and estate tax planning?

Greg Rosica: “All of those items affect different taxpayers in different ways. It’s applicable to understand what’s appropriate in your situation and that’s one of the things that we try to do in the Tax Guide. If there’s certain deductions that you may have, maybe they’re education deductions and see whether you’re income levels are appropriate to be able to take advantage of that. Maybe it’s student loan interest that you can deduct if you’re under certain income levels…all of that we lay out in the EY Tax Guide to help you through those situations.”

 

EY Tax Guide 2014

EY Tax Guide 2014. Image courtesy of EY.com

 

Candace Rose: What would you say are the most overlooked tax filing errors and overlooked tax deductions?

Greg Rosica: “We like our lists, and we have a list of the 25 most common errors that people make. They’re fairly simple ones like check your math. Look at your W-2 form you received from your employer, look at your 1099 form and look to see if there are mistakes in there because they may not be right. You want to get those corrected before you file.

Also, an error can be too big of refund. You want to make sure if you’re getting a big refund, that’s your money the government has been holding all year, you can get that along the way throughout the year – put that aside for yourself in some type of savings.”

 

Candace Rose: Do you have any additional tips or information you’d like to share?

Greg Rosica: “You can certainly get the EY Tax Guide online anywhere books are sold or download the e-book version, or you can go to our website to get a free list of the top 25 common errors as well as the top 50 deductions and that’s at EY.com/EYTaxGuide.

Also, don’t forget April 15th is around the corner, you can extend the time to file your tax return…but you can’t extend when you pay. If you’re going to owe money you’re going to need to have it calculated and paid in by April 15th, and then you can still extend when you actually send in your tax return or e-file it…but not when you pay.”

 

 

Actor Hill Harper Partners with MassMutual and NBA for the FutureSmart Challenge to Teach Teens About Money

Harvard educated award winning actor, Hill Harper has partnered with MassMutual and the NBA for the FutureSmart Challenge. This unique program is teaching “10,000 middle schoolers across the country financial literacy.” Wouldn’t you love the opportunity to learn how to manage money by Dallas Mavericks owner and “Shark Tank” investor, Mark Cuban? I know I would! These young men and women are having the opportunity of a lifetime to learn how to be financially secure and not fall into the trap of credit card debt, that so many of us have. Hill was kind enough to join me for an interview recently to discuss the FutureSmart Challenge and why he partnered with MassMutual.

 

Actor Hill Harper discusses his role with MassMutual and FutureSmart Challenge which is teaching over 10,000 middle school students across the country about finances. Image courtesy of Twitter.com/HillHarper

Actor Hill Harper discusses his role with MassMutual and FutureSmart Challenge. These unique program is teaching 10,000 middle school students across the country about finances. Image courtesy of Twitter.com/HillHarper

 

 

 

 

Candace Rose: What is the FutureSmart Challenge?

Hill Harper: “The FutureSmart Challenge is an amazing thing. I’ve partnered with MassMutual to teach over 10,000 middle schoolers across the country financial literacy.

We’re teaching a lot of different pretty high concept things about money and how many impacts their lives, but hopefully doing it in a pretty accessible way and fun way that they connect to the material, and I’m really proud that MassMutual stepped up to support it.”

 

Candace Rose: Why is it so important to educate kids on financial responsibility?

Hill Harper: “It’s critical and it’s never too young to start. The sad thing is that it’s not taught in schools. They learn biology or chemistry or history, social science, math reading…but not financial literacy.

We all deal with money everyday, and it impacts our current life and it impacts our future and the future of our families. It’s so important and understand the true things about money.

Let’s talk about some of the misconceptions:

  • Most of us have been taught that money is a result, in other words…that you need to chase it- chase money, go for the money when it’s actually not a result. It’s just a tool that needs to be used like a hammer pounds a nail. If you can actually put money in its right place and use it in the right way, it can work for you in a way.
  • We’ve also been taught that a dollar is a dollar is a dollar, but that’s not true. There are smart dollars and there are dumb dollars. How you use money will impact your life and what you spend it on. If you spend smart dollars, you’re going to have a better prospect and better financial future. When you spend dumb dollars like credit card debt, you’re going to get saddled with debt and it’s going to be very difficult to dig out from that.

Those are just two examples of what we talk about in the FutureSmart Challenge, and we issue this challenge to the young people to become leaders around money and make smart choices about their future.”

 

Candace Rose: I had a chance to check out the program a little bit last night and it seems amazing. You’ve partnered with the NBA (National Basketball Association), correct?

Hill Harper: “The NBA teams we’ve already visited include the Atlanta Hawks, we’re going to the Phoenix Suns, we’ve done the Dallas Mavericks with Mark Cuban- who gave a great presentation, LA Clippers. So we’ve already been to these NBA teams, and we do it in these arenas across the country where we speak to anywhere from 1500 to 3,000 kids inside these NBA arenas, which is just so much fun for them to come. The NBA teams have really supported it by providing their dance teams or their dunk teams, and so it keeps the kids engaged. It’s a fun way to do it, and we’re really proud of that combination of the teams stepping up with us and the NBA, and allowing us to partner and do this program with them.

And to be underscored, MassMutual stepped and devoted a million dollars to this program. That’s what I call true corporate responsibility saying ‘Listen, we’re going to help financial literacy of our young people, particularly most of these kids are from public schools from these areas, we’re going to help them and we’re going to devote a million dollars to this program.’ That’s why it’s important for me to let people know about it, so they can go visit the website and let MassMutual know that they’re having an impact…because obviously, I want this program to continue. I think it’s valuable and I think MassMutual needs to know that folks want it to continue and it has impact.”

 

Candace Rose: That’s absolutely amazing, I wish it had been around when I was kid, truthfully.

Hill Harper: “Absolutely. Most of us don’t start saving as adults until we’re well into our thirties, and there is a time value of money. If we had started when we were 11 or 12 years old even small amounts of our allowance or what we earned babysitting or cleaning somebody’s garage or mowing the lawn- that 20 year head start can be transformative and that’s what these kids need to learn.”

 

Candace Rose: What inspired you to get involved in the FutureSmart Challenge?

Hill Harper: “Well, for me, I have a foundation called the Manifest Your Destination Foundation. It’s all about helping folks achieve their goals and primarily works with people from underserved communities, and I started to find that what they would tell me is the reason why they can’t do this or that, whatever their goal might be is because of money. It reminded me of when I was young and I told folks when I was in public school that I was going to go to Harvard. They said ‘Well, you can’t afford that, you can’t do that.’ There’s all these excuses around money as to why we can’t do things.

There’s also these negative things around money that many families get hit with. Even when you graduate high school you get hit with all these invitations to apply for credit cards, and the next thing you know you’re in credit card debt. Financial literacy is so important on so many levels. One way is to not fall into a trap and the other way is to actually build for a future and use the time value of savings, that’s why I really believe in how transformative it can be.”

 

Candace Rose: Do you have any additional tips or information you’d like to share with us?

Hill Harper: “Well, the best thing is to go to MassMutual.com/FutureSmartChallenge. If you go there- number one, you’ll see our curriculum, you’ll see all the things that we’re talking about and how valuable these things are. Number two- just visiting the site shows MassMutual that this is having an impact and it’s an important program to continue.

I’m proud of them, I’m proud of their corporate leaders stepping up for it and I’ll continue to partner with them as long they want to do the FutureSmart Challenge.”

 

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Alzheimer’s Myths, Misconceptions, Treatment Options and Caregiver Burnout with Dr. J. Blake Casher, DO

According to the Alzheimer’s Association, “more than 5 million people are currently living with Alzheimer’s.” I grew up watching my grandfather suffer from the disease, and my brother, mother and I are full-time caregivers for my grandma who currently has Alzheimer’s. This horrific disease which has caused my grandmother to forget who her family is, which decade she lives in, the ability to control her bladder and has caused her to become combative and refuse to eat and take medication is not only a part of my life, but the family of the five million people suffering with Alzheimer’s. I recently approached the American Osteopathic Association about interviewing one of their esteemed physicians to discuss what I had hoped to hear, and that progress was being made in the fight against this disease. Unfortunately the fight against Alzheimer’s is stagnant, more work needs to be done and more attention needs to be brought to the forefront so progress can be made.

I applaud actor/comedian Seth Rogen for going before the senate this week to discuss the battle his mother-in-law is currently fighting with early onset Alzheimer’s disease. He finally gave me the courage to step up and discuss how this disease affected me as a child, and that I am currently going through as an adult. I am greatly appreciative of the AOA and Dr. J. Blake Casher, DO (of Lansing, Michigan) for the great interview on the difference between dementia and Alzheimer’s, research and treatment options, caregiver burnout and much more.

 

Dr. J. Blake Casher, DO joined Candace Rose to discuss the difference between dementia and Alzheimer's disease, common myths and misconceptions of Alzheimer's, treatment options and caregiver burnout. Image courtesy of Osteopathic.org

Osteopathic psychiatrist and Alzheimer’s expert, Dr. J. Blake Casher, DO  Image courtesy of Osteopathic.org

 

 

Candace Rose: We hear so much about Alzheimer’s and dementia. How do they differ?

Dr. J. Blake Casher, DO: “Dementia is the general term that describes the condition of memory loss, decreased function, etc. Alzheimer’s is a specific type of dementia. I usually try to make an analogy. Think of dementia in terms of automobiles. It is a car but doesn’t say which type of car. Is it a Chevy, a Buick, Honda? That is more specific as a type of automobile. Same with dementia. It can be Alzheimer’s, but it also could be other types of Dementia, like stroke, HIV, traumatic brain injury, Lewy Body. But, Alzheimer’s is by far the most common cause of dementia.”

 

Candace Rose: What are the most common symptoms of Alzheimer’s disease? What should people or family members look out for?

Dr. J. Blake Casher, DO: “The most common symptom is forgetfulness, initially slight, then more. Forgetting appointments, names of people they know, word-finding problems, losing things, missing doses of meds, leaving the burner on the stove, getting lost driving, forgetting to pay a bill. Family should look out for changes in memory or behavior (sometimes you see a change in personality, quieter, more irritable). Look out for changes in hygiene, bathing, shaving, changing clothes. If one suspects there may be Alzheimer’s brewing, start with contacting the family physician.”

 

Candace Rose: What are some of the most common myths and misconceptions of Alzheimer’s?

Dr. J. Blake Casher, DO: “One misconception is that forgetfulness is just normal aging, that everyone forgets as they age. True, there may be a slight change in memory as people age, but Alzheimer’s is more than that, plus it is progressive over time. Not everyone gets it. Another myth is that it is caused by a virus or by aluminum or something. The fact is that we don’t know the cause, is it a virus? Inflammation? Infection?  Another myth is that one can diagnose Alzheimer’s from a brain cat scan. Not true. In fact, we can never say for sure, 100%, that someone has it while they are living. The definitive diagnosis now is from a brain biopsy. Otherwise, the best we can say is Probable Alzheimer’s.”

 

Candace Rose: Are there any alternative treatment options that actually work? A lot has been said about coconut oil and Alzheimer’s lately. Can it help?

Dr. J. Blake Casher, DO: “There are many products out there purported to help control, cure, slow, Alzheimer’s disease. The fact is that none of them (except for the 4 FDA-approved pharmacologic meds) have been scientifically studied with placebo control, double-blind studies.”

 

My grandmother and our dog Francesca on Christmas Eve 2013.

My grandmother and our dog Francesca on Christmas Eve 2013.

 

Candace Rose: Are you seeing any advancement in research? 

Dr. J. Blake Casher, DO: “Research seems to be slow. As far as I know, there is nothing great on the Horizon for treatment. There has been some progress in tests to help diagnose the disease.”

 

Candace Rose: My grandfather suffered from dementia and my grandmother whom I care for has Alzheimer’s. Is there anything that my relatives and I can do to reduce our risk for getting the disease? 

Dr. J. Blake Casher, DO: “Having a first degree relative with Alzheimer’s increases your risk up to 4-fold. The best risk reducers involve staying healthy. Keep your weight down, don’t drink or smoke, exercise your body and your mind, be social, upbeat. Control medical risks such as blood pressure, cholesterol, diabetes. If you have had small or mini-strokes, make sure that your doctor has you on some type of blood thinner and that your carotid arteries are patent. Having more memory in reserve helps, having two parents with early-onset Alzheimer’s is a bad combination. The early-onset, prior to age 55, is more likely to be passed on and more rapidly progressive.”

 

Candace Rose: Are there any treatment options that slow the progression of dementia/Alzheimer’s? Or help patients so they aren’t so fearful or feel the need to wander?

Dr. J. Blake Casher, DO: “There are 4 approved medications at this time. There are 3 acetylcholinesterase inhibitors, such as Aricept, Exelon, and Razadyne. And there is the NMDA antagonist Namenda. Most doctors use a combination of namenda plus one of the 3. There are other types of medications to reduce fearfulness or paranoia, but there are no anti-wandering medications available.”

 

Candace Rose: I can personally attest to the fact that caregiving for an Alzheimer’s patient is very tough, especially for those of us who rarely have respite. How can we protect our health and wellbeing?

Dr. J. Blake Casher, DO: “The role of caregiver can be super-stressful. They have an extremely high risk of depression, suicide, insomnia, anxiety, and increased medical problems associated with the stress of taking care of someone. Family members need to be alert to a caregiver getting overly stressed. Then, something should be done, such as having someone else help, using respite care for the patient, having the patient enroll in a day program, or even placing the patient into assisted living. I also recommend caregiver support groups and the Alzheimer’s Association as a reference.”

 

Candace Rose: Do you have any additional information you would like to share with us?

Dr. J. Blake Casher, DO: “Alzheimer’s is a chronic, insidious and progressive disease that robs our memory and our identity in the process. There are no cures, but the medications do help some and are well worth using, beginning at the early stages and continuing into severe disease. Mental and Physical Stimulation and socialization are vital to helping preserve function as long as possible.”

 

Candace Rose: Where can we go for more information? 

Dr. J. Blake Casher, DO: “For more information, one can go to Alzheimers.org. This will link you to several other useful sites.”

 

How You Can Turn an Economic Crisis into an Opportunity for Your Family with Financial Expert, Mike Maloney

With the Great Recession still upon us, and many men and women still unemployed throughout the country, financial expert and best selling investment author, Mike Maloney joined me to discuss how families can turn an economic crisis into opportunity. He discussed what lies ahead for the U.S. economy, why you should invest in gold and silver, how we can prepare our families for another downturn, and much more.

 

 

 

Candace Rose: What do you think lies ahead short term for the U.S. economy?

Mike Maloney: “I try to never think short term. Short term, you just have a whole bunch of noise going on. Markets go up, markets go down…you don’t know what’s going to happen tomorrow. And then the news media tends to keep us preoccupied with things like the debt ceiling and so on, which is absolutely delusional. We live in a world that has a monetary system that requires ever increasing levels of debt or the whole thing goes into a deflationary collapse. Therefore, a debt ceiling is ridiculous and they always have to raise it. It’s just designed to drag out this dog and pony show every now and then, and keep us distracted from the things that are really going on.

And what is going on right now is the greatest financial emergency in history. The Federal Reserve just last month- people aren’t paying attention to this now because the news is a month old. Ben Bernanke announced that he wasn’t going to taper. Taper is just a reduction in how much currency they print each month. It took 200 years to go from no dollars in existence to about 800 billion. That’s what existed in 2008 before the crisis. That’s 0.8 trillion. They now create more than a trillion every year, and they’re not stopping. That’s 200 years worth of currency creation every year. The scale of this emergency is unfathomable. There will be economic consequences to the feds actions. They just don’t realize what the economic consequences are going to be.

Throughout history what you always see is that gold and silver always do an accounting of the expansion of the currency supply. And we’re expanding currency supplies around the planet like we’ve never seen before.”

 

Candace Rose: What can people do now to best prepare their families for another downturn?

Mike Maloney: “Well, the best thing that anyone can do for themselves is to become financially educated, and a foundation is to learn some monetary history and some simple economics. Those sound like really boring subjects, but they’re not. They are actually very exciting when you see how history repeats, and how it reflects on your life. The best place to get this foundation is at HiddenSecretsOfMoney.com. My recent video series is all about this and it’s all free.”

Candace Rose: How should people be investing their money during today’s uncertain times?

Mike Maloney: “I don’t make recommendations. What I tell people is what I do; and I’ve been buying gold and silver now for the past decade, and I continue buying. I think that gold and silver are still undervalued compared to the quantity of currency that they’re printing. There are only two currencies they can’t print, and that’s gold and silver; and gold and silver are also real money. The expansion of the currency supply – gold was $850 back in 1980, it’s a little over $1300 right now. Silver was $50 in 1980, it’s selling at about half that, at about $23 right now. They’ve created about 10 times the amount of currency since then. So for gold and silver to be in a bubble, gold would have to be about $8500 and silver would have to be $500 an ounce- and it’s only $23. They are on sale right now, they’re selling at absurdly low prices, and what happens periodically throughout history is the public wake up and realize how much currency the governments are printing and they rush back toward gold and silver and they bid up the value to account the expansion of the currency supply. The last time this happened was the 70s, before that was the 1930s. And during the 1970s gold rose 24 times its price, silver rose 36 times its price. The precious metals market has just barely begun. You’re going to see something breathtaking happen in the future here. I believe this is the greatest opportunity in the history of mankind, because this is the greatest crisis in the history of mankind.”

Candace Rose: As you mentioned, you’ve introduced some new educational video series “The Hidden Secrets of Money”, can you tell us more about it?

Mike Maloney: “It’s shot in 16 countries, we have two full time animators. It’s just a very entertaining and simple look at monetary history, how it reflects on your life. People think these subjects are boring…they’re not. They’re very exciting, they’re intriguing and what it leads to is when you learn these things, you make different choices. Those different choices create a different future, and it’s probably a far better future for the individual.”

Candace Rose: Well, thank you so much, Mike. Where can we go for more information?

Mike Maloney: “HiddenSecretsOfMoney.com and GoldSilver.com.”

Silver Linings From the Depth of the Recession with Fidelity’s John Sweeney

A lot of has changed since the market collapsed in 2008, housing prices are starting to increase, car sales are starting to go up, and people are starting to feel more relaxed about their money. Fidelity Investments, Executive Vice President John Sweeney joined me recently to talk about the changes investors have experienced over the last five years, whether or not these changes are temporary or permanent, and the proper steps we can take to put our best financial foot forward.

Fidelity Investments Executive Vice President, John Sweeney.

Fidelity Investments Executive Vice President, John Sweeney.

 

Candace Rose: According to the Fidelity Study, there may have been a silver lining to the financial crisis. Over the past five years investors have moved from scared to prepared. Can you tell us what that means?

John Sweeney: “The good news coming out of the financial crisis is that we saw about 58% of the people said that they actually felt more confident now than they did before the financial crisis began. What we see is whether we’re unable to predict where the stock market is going to go or interest rates may be, there are two levers that are very important and we can control our own personal economy. We can control what we save and we can control what we spend. We saw investors make changes to those two behaviors.”

Candace Rose: How have investors changed our behavior over the past five years?

John Sweeney: “The good news is about 42% of the people actually reduced their household debt, so whether that’s paying down a mortgage, paying off high interest credit card debt or changing their car loan, that actually has been beneficial because you’re actually spending less throughout your household finances.

The converse to that is we see about half the people actually increase their savings rates. They recognize that they had to take control of their own retirement preparedness, and the best way to do that is to save more and make sure you’re contributing to a 401(k) and an IRA.”

 

Candace Rose: Do you think the changes are temporary or permanent?

John Sweeney: “We actually see when we see changes like this where people are changing contributions out of a paycheck into a retirement account, those changes tend to be very long lasting. If you pay yourself first, then you’ll learn to budget and live on what’s left. If you’re trying to take savings out of your spending account, then it’s very difficult to do that because you end up spending more than you had planned sometimes.”

 

Candace Rose: What are some of the steps we should be taking to put our best financial foot forward to the future?

John Sweeney: “Well, one way to make sure you preserve the amount that you want to save, is to create an emergency fund. What we saw is almost 17% of the people who we surveyed had some impact to their employment during the market downturn. So preparing for that, anticipating that some bump in the road will occur down the road is one important step that people can take today to prepare for the next market downturn.”

 

Candace Rose: Do you have any additional tips or information you’d like to share?

John Sweeney: “Well, the one thing we like to make sure that people do is to set up a plan and understand the role that different parts of their portfolio are going to play against those plans. Everybody wants to retire, some of us want to send our kids to college or buy a home, as we want to understand the role that each part of our portfolio plays within our own household economy. Those people who have a plan feel more confident and are much more able to withstand market downturns.”

 

Candace Rose: Where can we go for more information?

John Sweeney: “We have a viewpoints article on our website: Fidelity.com that give five key tips that investors can talk about immediately. There’s lots of information and tools that people can go online and explore how to save more, how to construct their portfolio and what steps they can take. If they need additional help, they can certainly call us and ask for help from a representative as well.”