As all of your information is coming into your mailbox this month to prepare for your taxes (Doctor’s bills, old W-2′s, interest statements for student loans, etc.), it can be tempting (to some folks, at least) to forego the perceived “expense” of using a professional to help you save on your taxes for the year.

So, if you decide to go down that lonely road, please do at least watch out for these common errors which we routinely correct for those who have us review their previous-year returns:

* Filing the wrong status (dependent or independent, 0 instead of 1, etc.)
* Missing forms
* Forgetting to sign it (this is incredibly common! Make SURE you sign!)
* Not adhering to new laws (a biggie)
* Math errors or mixing up numbers
* Standardized deduction (one lump sum) when itemizing may return more
* Forgetting earned interest
* Not claiming your charitable donations (more common than you’d think!)
* Incorrect social security numbers
* Missing the deadlines
* Not checking last year’s taxes to see if anything carries over (again, very common — and a good reason to have a pro check it out)
* Not taking deductions where they’re pertinent (IRA’s, too much Social Security being taken out)
* Failing to include dependents who don’t live with you
* Claiming someone as a dependent who claimed themselves as independent
* Not filing domestic or self-employment taxes
* Not claiming credits where they’re due (Child Tax Credit, Earned Income Credit)

So what can you do to correct all of these errors?

1) Double check. And triple check. Then check again. The idea here is that when another pair of eyes look at it, they can see stuff you don’t. Your mind will tell you that things that you write or calculate are correct, even if they aren’t.

2) Go to a professional. Self-serving? Why, yes. But as I mentioned in my introduction, we get paid to know what we do, and following the tax code permutations is our J-O-B. We’ve seen so many tax returns, even already this year, that what would take you 12 hours — can be accomplished by me and my practiced team in one.

I’m not suggesting we never make mistakes … but can you really afford to skimp when thousands are on the line?

Financial Planner Richmond
Financial Advisor Richmond

Most of us spend a considerable amount of time and energy in our lives working for our families and accumulating wealth.

But unless you’re careful, all of it will be going to waste.

That’s why a well-crafted estate plan is so critical. It ensures that your hard-earned wealth (including intangible, non-financial assets) can pass intact to those you intend to be your beneficiaries, instead of being siphoned off to government processes and bureaucrats, or even being lost. We all dislike handing over our resources to those who don’t have our best interests in mind.

A well-made estate plan guarantees that this will NEVER happen to your family.

“But what happens if I don’t create an estate plan? Doesn’t the judicial system have easy steps in place for families?”

Yep, and it’s called “probate” (Latin for “prove the will”), and it’s an ugly process.

You see, “probate” guarantees government interference in how you transfer your estate (however large or small). Documents must be filed and approval must be received from a court to pay your bills, pay your spouse an allowance, and account for your property. Oh, and even worse–it all takes place in the public’s view.

If you fail to plan your estate, not only do you lose the opportunity to protect your family from an impersonal, complex governmental process (that is a burden at best) but it’s slapped across the public domain for all to see.

Then, of course… there’s taxes. You think the government is incentivized to keep those low on your behalf? There’s a variety of solutions for each family’s particular situation, but the plain fact is that working without a plan is U-G-L-Y no matter how you slice it.

When it comes right down to it, planning is a gift for your family (the people you love most) because if you don’t take care of things while you are living and able, they’ll have a mess to clean up when you are gone.

Even more, if you have children, you want to establish the proper (legal) procedure for ensuring they’re taken care of properly.

So if these issues are important to you (and I believe they are), make your tax preparation appointment with us count twice, and we can set you up with how to get this process started right.

Financial Advisor Richmond
Financial Planner Richmond

This has ALREADY been one of our most intense years, in preparing the groundwork for “tax season”, simply because the tax code is getting even MORE complex. And, truly–it seems as if I write that *every* year, which isn’t a great sign for families who are wanting to do their own taxes!

And, of course, Congress’ last-minute tax agreement didn’t make things any easier.

Don’t cry for us — this is our full-time occupation, after all! But I truly do pity those who attempt to wade through all of the different codes and forms on their own, and not devote a week’s labor to the transaction. It really doesn’t pay to “go it alone” for certain tasks.

So, for those of you who want our help, I’ve got a handy little list of what you’ll need to bring in. It’s mostly complete, but there may be certain situations where we’ll need other documentation to get you even more deductions. But, of course, we’ll let you know about that, should the situation arise!

Let me know your thoughts … and, of course, if you’d like to talk this over with us we DO have a couple slots left! Call or email soon, though.

Thomas Marshall’s
“Real World” Personal Strategy
The Tax Paper Chase List

Yes, this is a long list — but it’s the unfortunate reality of our tax code that it’s not even comprehensive! But these items will cover 95% of our clients. Really, this is for ensuring that we’re able to help you keep everything you deserve to keep under our tax code.

Even if for some strange reason you won’t be using our cost-effective services this year, feel free to use this list as a handy guide…

Personal Data
Social Security Numbers (including spouse and children)
Child care provider tax I.D. or Social Security Number

Employment & Income Data
W-2 forms for this year
Tax refunds and unemployment compensation: Form 1099-G
Miscellaneous income including rent: Form 1099-MISC
Partnership and trust income
Pensions and annuities
Alimony received
Jury duty pay
Gambling and lottery winnings
Prizes and awards
Scholarships and fellowships
State and local income tax refunds
Unemployment compensation

Homeowner/Renter Data
Residential address(es) for this year
Mortgage interest: Form 1098
Sale of your home or other real estate: Form 1099-S
Second mortgage interest paid
Real estate taxes paid
Rent paid during tax year
Moving expenses

Financial Assets
Interest income statements: Form 1099-INT & 1099-OID
Dividend income statements: Form 1099-DIV
Proceeds from broker transactions: Form 1099-B
Retirement plan distribution: Form 1099-R
Capital gains or losses

Financial Liabilities
Auto loans and leases (account numbers and car value) if vehicle used for business
Student loan interest paid
Early withdrawal penalties on CDs and other fixed time deposits

Automobiles
Personal property tax information
Department of Motor Vehicles fees

Expenses
Gifts to charity (receipts for any single donations of $250 or more)
Unreimbursed expenses related to volunteer work
Unreimbursed expenses related to your job (travel expenses, entertainment, uniforms, union dues, subscriptions)
Investment expenses
Job-hunting expenses
Education expenses (tuition and fees)
Child care expenses
Medical Savings Accounts
Adoption expenses
Alimony paid
Tax return preparation expenses and fees

Self-Employment Data
Estimated tax vouchers for the current year
Self-employment tax
Self-employment SEP plans
Self-employed health insurance
K-1s on all partnerships
Receipts or documentation for business-related expenses
Farm income

Deduction Documents
State and local income taxes
IRA, Keogh and other retirement plan contributions
Medical expenses
Casualty or theft losses
Other miscellaneous deductions

We hope this helps, and we look forward to seeing you this year!

Well, now the holidays are truly behind us, and this is the week where reality sets in for everybody.

No more extended family (which might be a relief?), no more parties, no more presents. Just …daily life. And, in my opinion, this week is actually crucial to how the rest of your year goes. Why?

Because intentions and actions matter. No, I don’t subscribe to a mystical “universal” law of attraction–but I DO believe that how we act out what we intend sets a sub-conscious belief system in place which can have an impact for months at a time.

So … are you making resolutions? In some ways, this whole ritual of “resolution-making” can become very cliche, but look–we all need little “nudges” to help us actually make changes in our lives. I see it as my role in your life to not only provide authoritative and actionable advice for your financial situation, but also to play the role as “coach” for your particular situation.

This is why our clients and their friends seek us out for *more* than simple financial advice, but a whole host of other services as well–from planning, to business services, to simple encouragement. I get to be someone in your life who says: “You can do this. You’re not alone.”

It’s my great hope that our relationship will continue to grow into 2011, and beyond. And not just for “business purposes”. We love our clients … you’re a family to us! I should say I mean that in the *positive* sense…we all might be a bit “familied-out” right about now!

So, with my coach hat firmly in place, here are some thoughts for effectively creating and pursuing your personal financial goals, as we move into 2011…

Thomas Marshall’s
“Real World” Personal Strategy
New Year, New Financial Goals

Not to make you feel guilty, but for every seven years you delay saving and investing for the future, you cut in half the income you would enjoy at the end of your life. So, let’s make 2011 the year we get on the right financial course, shall we?

Here are some suggestions to get started…

1) Set Realistic Goals First, ask the right questions and stay the course until you’ve found the answers. Goals that are shared are ten times more likely to be acted on. Don’t wait until you have everything set up to seek out accountability.

2) Make those goals concrete and then document them. Set your savings goals as a specific annual percentage of your adjusted gross income (AGI). It’s a great idea to save at least 10% of your AGI in tax-deferred retirement accounts and another 5% toward retirement in taxable investments. If you are behind on your savings, you may want to save even more in order to catch up.

Third, craft the best strategy to implement your goals, including prioritizing the appropriate retirement vehicles. Start by investing just enough to get the entire match from a company’s 401(k) plan (if you have one) and then fund your Roth IRA accounts next. After these two, make certain you have enough non-retirement savings.

Fourth–and this is a BIG deal– automate your plan. Automating putting money in an employer-defined contribution plan is easy. Automating a taxable savings plan is just as painless. Most banks or brokers offer an automatic money link between an investment account and a checking account. They should also offer a monthly automatic transfer between the two accounts.

But I will say one last thing: the most critical component of wealth management in the new year will be tax minimization. With the potential for tax rates to fluctuate even more than the stock market in 2011, it’s never been more important to monitor what “Uncle Sam” is seeking to take from your wallet!

Financial Advisor Richmond
Financial Planner Richmond