Things are just harder when dealing with the government. I keep the books for Bob's business. He does consulting work. Keeping the billing and paying expenses covers my main responsibilities. He does take a regular paycheck so I handle those entries.
Making state and federal payments of the withholding plus social security and medicare were once quite easy. Our bank would take federal deposits and his withholding due the state of Illinois was small enough that we remitted with the quarterly reports.
Now the governments want electronic payments. Usually no big problem but the state of Illinois has changed their website and I continue to struggle to find the right path to submit our info. Choosing 'business' is not a complete path. I have to find IL-501 payments. I keep notes in the payroll file to help me.
The one thing business does that the governments don't seem to have the capability to do is auto tab after a field is filled in. Phone number is a good example. A business site would automatically tab to the next box. I type in our 3 digit area code and the system jumps to the next box to receive the next 3 digits and then the 4 digit. Never on the government sites.
Also the governments when asking for dollar amounts insist that the two zeros be in place following the dollar amount. Business would assume '425.' meant $425.00. Not the government. Bob's withholding is rounded to the nearest whole number to make life easier for me. The IRS does not recognize the whole numbers only. I have to fill in the zeros.
Life is good. Small frustrations just need to be vented. Thank you for listening.
'til later
Friday, February 28, 2014
Monday, February 24, 2014
Investment Types
Often it is suggested that an investor's balance of two categories should be linked to the owner's age. Such as in your 50s, the equities (stocks) vs. fixed (bonds) should be 50/50. In your 60s, 40/60 with more fixed or bond investments versus stocks. The thinking being less risk later in life.
As our time on earth shortens, we have less time to recoup after stock market downs and even corrections. If you were 70s in 2008, that portion of your portfolio would have taken quite a hit.
The other side is if you were not in the market in 2013 you would have missed a year where equities increased near 25%.
So my challenge this weekend was to look at each of our mutual fund holdings and break them out Stocks vs Bonds. I found a website that shows the percentages of these plus cash holdings.
http://funds.ft.com/us/
Most of my followers know I compile a balance sheet showing our investments both inside and outside of retirement accounts at the end of each quarter. I took my year end sheet and broke out by percentages found on the above website.
Findings show that we hold larger holdings in Stocks within our IRAs/401(k) than Bonds but virtually 50/50. Our holdings outside retirement accounts is roughly 35/65. Now we know and we need to decide about rebalancing things.
Since Bob and I are approaching our mid-60s, our balance should be 40/60 or 35/65. So we are not far off. I did count cash holdings as fixed or bond.
'til later
As our time on earth shortens, we have less time to recoup after stock market downs and even corrections. If you were 70s in 2008, that portion of your portfolio would have taken quite a hit.
The other side is if you were not in the market in 2013 you would have missed a year where equities increased near 25%.
So my challenge this weekend was to look at each of our mutual fund holdings and break them out Stocks vs Bonds. I found a website that shows the percentages of these plus cash holdings.
http://funds.ft.com/us/
Most of my followers know I compile a balance sheet showing our investments both inside and outside of retirement accounts at the end of each quarter. I took my year end sheet and broke out by percentages found on the above website.
Findings show that we hold larger holdings in Stocks within our IRAs/401(k) than Bonds but virtually 50/50. Our holdings outside retirement accounts is roughly 35/65. Now we know and we need to decide about rebalancing things.
Since Bob and I are approaching our mid-60s, our balance should be 40/60 or 35/65. So we are not far off. I did count cash holdings as fixed or bond.
'til later
Tuesday, February 18, 2014
Seasonal Work
I started my seasonal job yesterday. I work during tax season only for a CPA firm across town. There are 3 partners plus 3 other CPAs and support staff of 4, one of which works part time. This is my 12th tax season with them. Yesterday I worked over 6 hours. Most of my time was spent getting up to speed and adjusting to a temporary computer. They promise my old one will be back in place come the end of the week. So to scan and print I had to use the network. That means printed items came out on the huge specialty copier in the center hall. Scanned items took 6 or 7 steps.
I think I handled 16 or 17 returns yesterday. I only handle the 1040s (individual returns, not corporations or partnerships). I will process nearly 800 by April 15. I am the last one to check wages, withholding, preparer's letter against the return. I complete our computer file by scanning different types of documents. I prepare the invoice and assemble everything into a nice neat package for the client.
Because the IRS prefers efiling, we efile most of our clients. We can not do that without their signature(s) on certain forms. Those forms are provided in their package and we await receipt of the signed forms before we electronically file their returns.
That's the second half of my job. I share the responsibility of efiling the returns upon receipt of client signatures. It's a multiple step computer process with a couple of verification steps. Then we scan the signature page and file the paper copy for our records. The IRS can knock on the firm's door any day and audit our process and our files of signed forms.
That happened to me in another accountant's office about the second year we offered efiling. I had the required signatures but they demanded copies of W2s which we did not keep before that surprise audit. Our procedure changed that day.
I enjoy the work for the most part. I also enjoy working part time. Come April 1, I will be seeing nearly full time hours. I will be so happy to see April 15 come.
'til later
I think I handled 16 or 17 returns yesterday. I only handle the 1040s (individual returns, not corporations or partnerships). I will process nearly 800 by April 15. I am the last one to check wages, withholding, preparer's letter against the return. I complete our computer file by scanning different types of documents. I prepare the invoice and assemble everything into a nice neat package for the client.
Because the IRS prefers efiling, we efile most of our clients. We can not do that without their signature(s) on certain forms. Those forms are provided in their package and we await receipt of the signed forms before we electronically file their returns.
That's the second half of my job. I share the responsibility of efiling the returns upon receipt of client signatures. It's a multiple step computer process with a couple of verification steps. Then we scan the signature page and file the paper copy for our records. The IRS can knock on the firm's door any day and audit our process and our files of signed forms.
That happened to me in another accountant's office about the second year we offered efiling. I had the required signatures but they demanded copies of W2s which we did not keep before that surprise audit. Our procedure changed that day.
I enjoy the work for the most part. I also enjoy working part time. Come April 1, I will be seeing nearly full time hours. I will be so happy to see April 15 come.
'til later
Friday, February 14, 2014
Valentine's Bargains
I have a friend whose smallest daughter will be celebrating her 4th birthday next week. She was telling me how expensive the favors, paper products, and decor were in the theme. Theme? One of those very special Disney princesses.
I had a bargain suggestion right away. Today is Valentine's Day. Shelves everywhere are packed with pink and red paper products, trinkets, and the like. I suspect tomorrow all of these will be marked down 40% or so and toward Monday or Tuesday they will be dropped 50%.
If my friend purchases one item or two with the correct princess face, she can supplement with pink paper products, favors and goody bags. Touch them up with some glitter and/or lace. Voila. Party made for her little princess.
'til later
I had a bargain suggestion right away. Today is Valentine's Day. Shelves everywhere are packed with pink and red paper products, trinkets, and the like. I suspect tomorrow all of these will be marked down 40% or so and toward Monday or Tuesday they will be dropped 50%.
If my friend purchases one item or two with the correct princess face, she can supplement with pink paper products, favors and goody bags. Touch them up with some glitter and/or lace. Voila. Party made for her little princess.
'til later
Wednesday, February 12, 2014
Interest Rates
It appears the government will continue printing $, keeping interest rates very low. I believe their fear is the effect easing will have on the stock market (which is grossly overpriced) and inflation.
Inflation you ask. Yes inflation. The government sites that our 2013 inflation rate was under 2%. Please keep in mind their calculations no longer include food and fuel. That's right. These are not figured into the inflation rate.
Have your grocery bills increase over the last 12 months? I will admit the price we pay at the gas pump is lower now than it was last spring. Not much less but still lower.
I'm starting to believe we are on the verge of some real changes. The stock market will correct. I'm hoping it's just a correction and not a collapse. Interest rates will climb. Of course the rates will increase for borrowing before rates paid to our bank passbook account or our money market increase.
What to do? Shortest maturities for your bond investments and possibly take some gains from your equity investments? Timing? Always an issue. Great questions. Sometimes I feel like we are on a ride at the fair with the track being laid just ahead of our car. No idea where the next turn or drop will be.
'til later
Inflation you ask. Yes inflation. The government sites that our 2013 inflation rate was under 2%. Please keep in mind their calculations no longer include food and fuel. That's right. These are not figured into the inflation rate.
Have your grocery bills increase over the last 12 months? I will admit the price we pay at the gas pump is lower now than it was last spring. Not much less but still lower.
I'm starting to believe we are on the verge of some real changes. The stock market will correct. I'm hoping it's just a correction and not a collapse. Interest rates will climb. Of course the rates will increase for borrowing before rates paid to our bank passbook account or our money market increase.
What to do? Shortest maturities for your bond investments and possibly take some gains from your equity investments? Timing? Always an issue. Great questions. Sometimes I feel like we are on a ride at the fair with the track being laid just ahead of our car. No idea where the next turn or drop will be.
'til later
Tuesday, February 11, 2014
Social Security
Bob and I attended a presentation last evening at the library. The speaker is a financial planner/insurance salesman. We each learned something. We learned some terms.
We have an appointment next Thursday to meet with this fellow and discuss our specifics regarding when to take Social Security. I have a few questions about Medicare as well. Bob will be 65 in July. From what I have read he needs to apply for Medicare 3 months before he turns 65. We currently pay for health care insurance through his pension.
When we got home I printed off current social security statements from the web. If you are waiting for yours to come via snail mail, you need to know they are available via the web or you have to call and request paper statements.
The site is: ssa.gov
Create an account. I learned last night that the passwords I set up last summer are only good for 6 months. There is an easy method for resetting passwords. I printed our statements. That's all the financial dude needs from us for next week's meeting.
That brings me to what we are seeking direction. We subscribe to the newsletter published by Bob Brinker. We moved $ out of one mutual fund and placed it in the money market account within that fund family. Brinker has direction for where to divide the proceeds to capture interest rates as they begin to creep up. Very short maturities mostly.
We have not purchased any of the three funds he recommended. Bob is thinking we need more professional advise. So we are thinking a professional adviser to help us create a complete plan. We want someone we will pay for his time and talent. Most of them sell mutual funds and insurance for a profit. We are seeking someone with our interests as his only goal.
'til later
We have an appointment next Thursday to meet with this fellow and discuss our specifics regarding when to take Social Security. I have a few questions about Medicare as well. Bob will be 65 in July. From what I have read he needs to apply for Medicare 3 months before he turns 65. We currently pay for health care insurance through his pension.
When we got home I printed off current social security statements from the web. If you are waiting for yours to come via snail mail, you need to know they are available via the web or you have to call and request paper statements.
The site is: ssa.gov
Create an account. I learned last night that the passwords I set up last summer are only good for 6 months. There is an easy method for resetting passwords. I printed our statements. That's all the financial dude needs from us for next week's meeting.
That brings me to what we are seeking direction. We subscribe to the newsletter published by Bob Brinker. We moved $ out of one mutual fund and placed it in the money market account within that fund family. Brinker has direction for where to divide the proceeds to capture interest rates as they begin to creep up. Very short maturities mostly.
We have not purchased any of the three funds he recommended. Bob is thinking we need more professional advise. So we are thinking a professional adviser to help us create a complete plan. We want someone we will pay for his time and talent. Most of them sell mutual funds and insurance for a profit. We are seeking someone with our interests as his only goal.
'til later
Monday, February 10, 2014
Another Frigid Monday
Yet another frigid week ahead. Grateful the old furnace is still running. Grateful too for blankets to cover us while we watch TV at night. Thermostat is set at 67 in living room while family room is actually cooler by a degree or two.
What's on my mind is the gas bill. The last one was over $150 and I expect the next will be higher still. We have not opted for the flat monthly rate. Our offset is the electric bill in the summer when the air conditioning runs to keep us at 72 degrees.
As far as budgeting a flat monthly rate would make things easier. That is until the adjustment month comes along. Then it becomes an unknown as far as budgeting. The one sure thing is it won't be less per month.
Stay warm and safe. Like my mother-in-law would say "This too shall pass."
'til later
What's on my mind is the gas bill. The last one was over $150 and I expect the next will be higher still. We have not opted for the flat monthly rate. Our offset is the electric bill in the summer when the air conditioning runs to keep us at 72 degrees.
As far as budgeting a flat monthly rate would make things easier. That is until the adjustment month comes along. Then it becomes an unknown as far as budgeting. The one sure thing is it won't be less per month.
Stay warm and safe. Like my mother-in-law would say "This too shall pass."
'til later
Thursday, February 6, 2014
Reagan's Birthday
My grandfather scoffed at the actor who gave a wonderful speech back in the 60s at the convention that nominated Goldwater as the GOP candidate to run against LBJ. An actor who is trained to be someone else, to deliver the writer's words, to portray thoughts to an audience.
The actor stayed around. Running himself for the highest office. Running and then failing. Grandpa watched and wondered why this actor kept focusing on this job.
I have very strong memories of this country's Carter Days. We purchased our current home in 1985 when interest rates were still at highs hit under Jimmy. We were able to 'buy down' to 12.75%. Buying down meant we paid money up front for a lower rate.
You might ask how we could afford to buy a more expensive house and pay down a rate. We have been savers from the beginning. We would never put down on a house the very highest we could if that shorted our emergency savings fund, our cushion against the unknown future.
Please understand that our savings were making upwards of 13% due to the inflation felt under Carter. That's right. The credit union (almost always higher rates than banks on savings) paid us nothing for our first $1,000 in the account but paid 13% on the rest of our nest egg.
Back to Reagan and Grandpa. I think Carter wore him down and so did Reagan's persistence. I think that was true for many of Americans in the fly over portion of these United States. As I recall Ronald won by a large margin. His presidency was quite remarkable.
Happy Birthday Mr. President. One of the greatest would have been 103 today. I celebrate him right along with Washington, Harrison, and Lincoln born in the month of February.
'til later
The actor stayed around. Running himself for the highest office. Running and then failing. Grandpa watched and wondered why this actor kept focusing on this job.
I have very strong memories of this country's Carter Days. We purchased our current home in 1985 when interest rates were still at highs hit under Jimmy. We were able to 'buy down' to 12.75%. Buying down meant we paid money up front for a lower rate.
You might ask how we could afford to buy a more expensive house and pay down a rate. We have been savers from the beginning. We would never put down on a house the very highest we could if that shorted our emergency savings fund, our cushion against the unknown future.
Please understand that our savings were making upwards of 13% due to the inflation felt under Carter. That's right. The credit union (almost always higher rates than banks on savings) paid us nothing for our first $1,000 in the account but paid 13% on the rest of our nest egg.
Back to Reagan and Grandpa. I think Carter wore him down and so did Reagan's persistence. I think that was true for many of Americans in the fly over portion of these United States. As I recall Ronald won by a large margin. His presidency was quite remarkable.
Happy Birthday Mr. President. One of the greatest would have been 103 today. I celebrate him right along with Washington, Harrison, and Lincoln born in the month of February.
'til later
Wednesday, February 5, 2014
Logical?
The CBO has warned that Obamacare will cost jobs. Many people will have their hours cut. Warning, warning.
Yesterday I think I heard the White House claim in response that people will have the choice to work less hours without losing their health insurance. Please remember, it's insurance and not care.
I am lost in their logic. If my hours are cut and I have to cover the cost of the insurance, how will I be ahead? Won't I have less money with which to pay for the insurance? In fact less money with which to feed my family and pay my mortgage?
The real shocker is the number of Americans who follow right along without a question mark appearing over their heads. Probably the same folks who understood that forcing people to buy health insurance would end with everyone having insurance. I want to believe in the magic wand action but alas I have a brain that does not believe.
White House may be sending me their Koolaid packet with instructions if I keep questioning.
til later
Yesterday I think I heard the White House claim in response that people will have the choice to work less hours without losing their health insurance. Please remember, it's insurance and not care.
I am lost in their logic. If my hours are cut and I have to cover the cost of the insurance, how will I be ahead? Won't I have less money with which to pay for the insurance? In fact less money with which to feed my family and pay my mortgage?
The real shocker is the number of Americans who follow right along without a question mark appearing over their heads. Probably the same folks who understood that forcing people to buy health insurance would end with everyone having insurance. I want to believe in the magic wand action but alas I have a brain that does not believe.
White House may be sending me their Koolaid packet with instructions if I keep questioning.
til later
Monday, February 3, 2014
Tax Season is upon us.
Per my tip in the past, you and I have been squirreling away statements and tax documents since early January. It's time to open that stash and determine what is still missing. Do you have your W2(s)? Have you received your 1099-INT from your bank savings account? Your 1099-DIV from your stock broker and/or mutual funds.
Are you expecting a K-1 from a partnership or small business? Those are not due until mid-March. You may be waiting a long time for those.
Have you called your CPA or purchased your tax software? I used a 25% coupon for Office Max and purchased HR Block software (aka Tax Cut). I have loaded it on my laptop and have received updates. I have started entering things on our personal return.
The business side still waits for my attention. The software has promised an important update later this week. I think I will wait until then. I have printed off our balance sheet and income statement. I have run a couple of accounts in General Ledger format. We received our 1099-MISC from our large client on Saturday. I have balanced the bank account. I'm ready to go.
Our business will spin off our K-1 which we will need for our personal return.
'til later
Per my tip in the past, you and I have been squirreling away statements and tax documents since early January. It's time to open that stash and determine what is still missing. Do you have your W2(s)? Have you received your 1099-INT from your bank savings account? Your 1099-DIV from your stock broker and/or mutual funds.
Are you expecting a K-1 from a partnership or small business? Those are not due until mid-March. You may be waiting a long time for those.
Have you called your CPA or purchased your tax software? I used a 25% coupon for Office Max and purchased HR Block software (aka Tax Cut). I have loaded it on my laptop and have received updates. I have started entering things on our personal return.
The business side still waits for my attention. The software has promised an important update later this week. I think I will wait until then. I have printed off our balance sheet and income statement. I have run a couple of accounts in General Ledger format. We received our 1099-MISC from our large client on Saturday. I have balanced the bank account. I'm ready to go.
Our business will spin off our K-1 which we will need for our personal return.
'til later
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