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  • Julie Skye

Tax Day-Eve and Bear vs. Bull

(I am attaching the content of this email as my program strips out the formatting)


Today is truly a day to celebrate: this is the Eve of the day many scramble to finish their tax returns, but this year, you get to put up your feet and put this task off…IF you want to. In addition, 80 million taxpayers will get direct deposits into the bank account that is linked to their tax return this week… if your income is between: $75,000-$99,000 for singles, and $150,000-$198,000 for married couples.

I know you’ve heard this in the evening news…that each individual will be getting $1,200…but you might have assumed that somehow, you would be left out. While most of us usually wait before we count our chickens, these eggs could actually hatch! There will be an additional $500 for children under 17. This is a refundable credit for your 2020 tax year, and I recommend you ask your CPA for more detail here, as this is about as confusing as it gets.

If you have not filed your 2019 return the IRS will rely on your 2018 income. If your income has changed significantly, let’s talk, NOW: it might be wiser for you to hold off on filing 2019 if your income was higher than 2018. Note…if you expect a return for 2019, don’t delay…file today and get that money!

Final detail here…be sure the IRS has your current bank account and address: if you are not sure, just go to IRS.gov and search for form 8882 and update your info.

Initially the IRS gave us a delay in paying taxes due, to July 15th…but now, the actual filing has been changed. In order to put off filing your tax return, you will need to file a request for Extension…form 4868, but it is really a technicality and all “extensions” are automatically approved. You can count on your CPA to give you good advice here…so please be sure we all are in communication.

Another detail…if you planned to do a Roth or deductible IRA contribution at tax time…you can make that contribution up to the day you file…or file on July 15th. Note: it is always good for you to monitor your IRA ins and outs: simply go to the last page of your monthly Schwab statement to the section with a running total of all contributions and withdrawals. You should also check for in December to make sure the amount Schwab has is correct…but please know I’ll be working with you to make sure you have taken your full required withdrawal: the penalty is 50% of what you SHOULD have taken!

Not, onto RMDSRequired Minimum Distributions! The short story is that everyone gets to take off a year! You get to sit out on the sidelines and don’t have to take any withdrawals on your IRA.

  • If your FIRST RMD was to occur in 2020 and we have been talking about if you should take 1 or 2 distributions…then we get to have a tax holiday.

  • If you have already taken some of your IRA RMD out…what you took out of your IRA is basically a taxable withdrawal from your IRA.

  • You are out of luck for January BUT…if you took out your RMD in February, March or April…you can technically roll that back to your IRA.

  • If you don’t qualify for this…just wait and watch: there is not telling what the IRS will do going forward…there could be many more changes by the end of the year.

I am grateful that our elected officials are not asleep at the wheel: there are many people hurting in many ways, and this is the time we need help from Washington DC.

Final thoughts for today: I’ve attached a page that I think you should print out and pay close attention to. It goes back to 1960 and tracks bear market declines and bull market recoveries, including what was lost and what was subsequently gain. What is clear is that we have had a very tame bear and considering what we are facing, I would be absolutely shocked if we have seen the final bottom. Can you believe I’ve lived through 8 bull-bear markets…as have many of you? We can do this!

Please Be Safe and count on me to keep bringing information that is relevant to you!



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