DOCUMENTING 2021 DEDUCTIONS
I expect by
now you have prepared and submitted your 2020 federal and state tax returns and
are waiting, patiently, for your refunds.
Did you find
it difficult to compile all the necessary 2020 information and documentation to
give to your tax preparer? The more
organized you are at tax time the more likely you will be able to take full
advantage of all deductions, credits and tax-saving strategies available. And
the more organized you are the lower your tax preparation fee.
Taxpayers are
required to keep good contemporaneous records and documentation of all items of
income reported and all deductions and credits claimed on their income tax
return in the manner prescribed by Congress, the IRS and the US Tax Code.
Go out and
buy an accordion file folder. Label the
first pocket “Income Tax Returns”. This
is where you will put your copy of your 2021 federal and state income tax
returns once completed. Use the other
pockets for documentation of specific sources of income and expenses.
During the
year put acknowledgements, receipts, statements and other forms of
documentation for qualified expenses in the applicable pocket. If a document is not self-explanatory, write
a brief description on it.
Be aware that
some deductions require special record-keeping or additional information. This guide will explain in detail what
documentation you need to save.
It is better
to save too much documentation than too little.
Even if you normally do not itemize, it is a good idea to keep records
and receipts for all "itemizable" expenses just in case.
Keep records
and receipts during the year with the assumption that your return will be
audited. While chances are this will not
happen, if your return is chosen for review it will be a blessing to have
everything well documented in advance rather than having to start from scratch
and reconstruct the necessary supportive documentation.
I have
created the 2021 GUIDE TO TAX RETURN RECORDKEEPING to help you in gathering and
organizing your tax “stuff” and help you to pay the absolute least federal
income tax possible.
My guide
contains detailed text covering what is taxable and deductible and what
information and documentation you will need to properly prepare your 2021 tax
return, and forms, schedules and worksheets for compiling and identifying the
documentation you will need to provide to your professional tax preparer in
2022. It discusses in detail –
·
MY
BEST TAX ADVICE
·
WHAT
TO GIVE YOUR PREPARER
·
WHO
MUST FILE A 2021 TAX RETURN
·
FILING
STATUS
·
DEPENDENTS
AND EXEMPTIONS
·
INFORMATION
RETURNS
·
INVESTMENT
SALES
·
2021
CONTRIBUTION LIMITS FOR RETIREMENT PLANS
·
REPORTING
GAMBLING INCOME
·
ADJUSTMENTS
TO INCOME
·
ITEMIZED
DEDUCTIONS
·
DEDUCTIBLE
RENTAL EXPENSES
·
CHILD
CARE EXPENSES
·
ESTIMATED
TAXES
·
HOW
LONG MUST I KEEP MY TAX RECORDS
·
YEAR-END
TAX PLANNING
The cost of
the Guide is only $10.95 sent as an email attachment – the text in pdf format
and the forms, schedules and worksheets in Word format. A print version sent via postal mail is also
available for $15.45.
Send your
check or money order for $10.95 or $15.45, payable to Taxes and Accounting,
Inc, to -
TAXES AND
ACCOUNTING, INC
2021 GUIDE TO
TAX RETURN RECORDKEEPING
POST OFFICE
BOX A
HAWLEY PA
18428
THINGS NO ONE EVER
TOLD YOU
Like her
mother Judy Garland, Liza Minnelli has had issues with drug and alcohol
dependency over the years.
I remember a
friend, also a singer, telling me that one night in the 1980s when she was with
friends at New York City’s famous, or perhaps infamous, Studio 54 Liza, who neither
she nor her friends knew, came up to them and said, “You must try the coke that is circulating.” She was not talking about soda.
Her signature
song is, of course, “Cabaret”, from the Broadway musical of the same name. Liza won an Oscar for Best Actress in a
Leading Role for her role as Sally Bowles in the movie adaptation.
The song
“Cabaret” tells of Sally’s London roommate, Elsie, who dies young from “too much pills and liquor”. It was Elsie who told Sally that “life is a cabaret” and that you should
live life to the fullest. In the
original song lyrics, Sally sings –
“I made my mind up back in Chelsea, when I
go, I’m going like Elsie.”
At a certain
point starting in the 90s, after a successful stint in rehab, Liza changed the
lyric when singing “Cabaret” in concert.
She now sang –
“When I go, I’m NOT going like Elsie!”
LBJ
TOOK THE IRT DOWN TO 4th STREET USA. WHEN HE GOT THERE WHAT DID HE SEE? THE
YOUTH OF AMERICA ON LSD!
While I may
be among the “last of the dinosaurs” - preparing all my 1040s manually – in
some ways I was way ahead of my time.
For example,
I have been using acronyms in notes and correspondence to friends, family, and
clients, and in my writings, for decades before the IM, DM and texting,
beginning back when, while there were lots of twits around, none of them
“tweeted”. It started when I put “HVD”
in the “memo” of the paychecks I wrote for employees of the Art Center in
Summit back in mid-February of 1980. I
started using WTF in the early 90s.
Americans
have always been fascinated with acronyms – “a word formed from the initial letter or letters of each of the
successive parts or major parts of a compound term”. Like FYI for For Your
Information.
The world of
emails and text messaging has created a whole new appreciation for and
vocabulary of acronyms – BTW (By The Way), LOL (Laughing Out Loud), MIRL (Meet
In Real Life), TFB (guess).
In my
wanderings on the web I found an online “Internet Acronyms Dictionary” and
discovered that AAAAA was not a group for drunk drivers but the American Association
Against Acronym Abuse.
Government,
at all levels, has always been famous for its acronyms. We all know what the
FBI, the CIA, and the DMV are. And, thanks to television, we are also aware of
SWAT, JAG, CSI and NCIS.
The military
is especially enamored of the practice. A PFC could be promoted to become a
CPO. In military speak PABST does not refer to Blue Ribbon Beer but to Primary
Adhesive Bonded Structure Technology. And let’s not forget the infamous WMDs –
Weapons of Mass Destruction.
Some acronyms
have become actual words. A classic example is “snafu”, a military acronym for
Situation Normal, All Fouled (not the original word) Up. The word “radar” is
actually an acronym for RAdio Detection And Ranging, as the word “laser” is for
Light Amplification by Stimulated Emission of Radiation.
I was told
many years ago by, I think, a teacher that the equivalent of the “n” word for
persons of Puerto Rican extraction came from a US Immigration category stamped
on the papers of certain individuals arriving on Ellis Island – Spanish,
Portuguese, Indian and Colored - although I cannot find any real documentation
of this online. I do know for a fact that I am a WASP (While Anglo Saxon
Protestant).
It is,
however, an “urban legend” that the “n” word for Italians came from the fact
that, as illegal aliens in the 30s and 40s, they were With Out Papers, or With
Out Passport. According to Wikepedia “wop” is taken from “the Neapolitan
‘guappo’, meaning dude or thug. The word defines those who belong to the Guapperia
o ‘Camorra’, a criminal organization similar to the Sicilian Mafia located
mostly in the province of Campania.
Acronyms are
certainly in frequent use in my profession – taxes. The AGI (Adjusted Gross
Income) has been around for at least as long as I have been in the business,
and there is now the non-gift bearing MAGI (Modified Adjusted Gross Income).
And many are all familiar with the dreaded AMT (Alternative Minimum Tax).
TRA 86 (the
Tax Reform Act of 1986) created a whole new set of acronyms. Under TRA 86 a PAL
(Passive Activity Loss) needs a PIG (Positive Income Generator). There is ACRS
(Accelerated Cost Recovery System) and MACRS (Modified Accelerated Cost
Recovery System), both the result of FACRS (Foolhardy Acts of Congress under
the Ruse of Simplification).
Many
taxpayers save for retirement with either an IRA (Individual Retirement
Account), a SEP (Simplified Employee Pension plan) or a SIMPLE (Savings
Incentive Match PLan for Employees). One of the more complicated areas of the
Tax Code concerns the NOL (Net Operating Loss).
As I have
said before at THE WANDERING TAX PRO, I have often found errors in tax returns
prepared by a CPA.
I belong to
the NATP (National Association of Tax Professionals) and, at one time, the NSTP
(National Society of Tax Professionals) – as well as AAA (Automobile
Association of America) and AARP (American Association of Retired Persons).
Over the years I have also briefly belonged to the ASTP (American Society of
Tax Professionals) and the NSA (National Society of Accountants). I have often
attended tax seminars sponsored by the CSEA (California Society of Enrolled
Agents).
I have been
using WTF for years. Back before my
mentor Jim Gill retired and handed me his tax practice, he had given me a
return to work on. Included with the client’s “stuff” was a listing of
deductions on which there was one item whose nature I was unsure of. So, I
wrote “WTF?” next to it and put it in the “Need More Information” box. A few
days later Jim said that the client had been in and they were not sure what I
had meant – but thought it might be “What’s This For?”. I told him he was close
and explained what it actually stood for.
I use certain
specific acronyms in my blog postings. Those of you who read THE WANDERING TAX
PRO are aware that I hate GD extensions. A client asked what the GD stood for
and I told him “exactly what you think it stands for!” It is not Government
Deferred or anything like that. I often speak ill of the DFB’s in Trenton or
Washington, a reference to our federal and state elected representatives, and
provide the “clean” version as Damned Fool Bureaucrats, although that is not
really what it stands for. When I discuss a FU you could interpret this as a
Foul Up, but you would be wrong. Again, it is exactly what you think it stands
for. FFR is For Future Reference and SGTM is Sounds Good To Me.
Regular
visitors to THE WANDERING TAX PRO know that I end each day’s post with TTFN (Ta
Ta For Now).
AND AWAY WE GO!
There has
been a long-standing tradition of making successful television shows out of
popular Broadway plays and theatrical movies, from THE NAKED CITY, TOPPER and
MR LUCKY to MASH, THE ODD COUPLE, and ALICE.
A while back Hollywood began to reverse the trend, making inferior films
based on successful television series.
The first tv
series based on a play and/or movie was MAMA, based on the 1944 play and 1948
movie I REMEMBER MAMA. The show ran on
CBS from July 1, 1949 to July 27, 1956.
The cast included a young Dick Van Patten of EIGHT IS ENOUGH.
The second
series taken from a play and/or movie was THE FRONT PAGE, starring real life
journalist John Daly (who would later become famous at the host of WHAT’S MY
LINE) as newspaper editor Walter Burns.
It had a brief run from September 29, 1949, to January 26, 1950.
The third
movie turned into a television series was THE LIFE OF RILEY, a successful radio
comedy that was made into a movie in 1948.
Both the radio show and the movie, and eventually the tv series, starred
William Bendix as Chester A Riley. But
Bendix was not tv’s first Riley.
Television’s
first Chester A Riley was none other than “honeymooner” Jackie Gleason.
William
Bendix was supposed to have starred in the initial television version, but his
RKO Radio Pictures movie contract prevented him from appearing.
The first
series was telecast from October 4, 1949 to March 28, 1950. It won television's first Emmy, for
"Best Film Made For and Shown on Television". According to Wikepedia
it came to an end because the producer and the sponsor, Pabst Brewing Company,
reached an impasse on extending the series for a full 39-week season.
The show
returned on January 2, 1953, with a totally new cast that now included William
Bendix as Chester A and Marjorie Reynolds as Mrs. Riley, and lasted for 6
seasons. I remember watching it as a
child.
Speaking of
first actors to appear in a role and Jackie Gleason – Audrey Meadows, who
became famous as Alice Kramden on the iconic HONEYMOONERS tv show, was not the
first actress to portray Alice on tv.
The original Alice Kramden, to Jackie Gleason’s Ralph when “the
Honeymooners” first appeared as a regular series of skits on the DuMont Network's
"Cavalcade of Stars" was Pert Kelton.
Kelton
appeared in the original 10 to 20-minute sketches. She was abruptly replaced by Audrey Meadows
as a result of blacklisting - the practice of denying employment to
screenwriters, actors, directors, musicians, and other American entertainment
professionals during the mid-20th century because they were accused of having
Communist ties or sympathies, a practice that grew out of Joseph McCarthy’s
House Un-American Activities Committee witch hunt. Instead of acknowledging she was being
blacklisted, the producers explained that her departure was based on heart
problems.
Kelton is
most famous for her Broadway role as Mrs. Paroo, the Irish mother of the town
librarian Marian Paroo, in Meredith Willson's Broadway musical THE MUSIC MAN, a
role she reprised in the 1962 film version of the show.
FYI –
Broadway legend Elaine Stritch played Trixie, the burlesque dancer wife of Ed
Norton, for one sketch before being replaced by Joyce Randolph.
CALLING A SPADE A
SHOVEL
Let’s be
honest.
If you
continue to believe, support and defend Trump you are –
1. a moron,
or
2. a racist,
or
3. you have
no conscience, or
4. like Trump
himself, all three.
There is absolutely
no legitimate or acceptable reason for any intelligent American with a
conscience who cares anything about America to support and defend Trump and his
lies.
In the
history of our country no one individual has ever done more damage to America,
American values and American democracy than Donald T Rump.
Period. End of story.
SURFIN’ USA
http://www.bringfido.com
Whenever my uncle from Maryland would visit my mother, his sister, at the Methodist Home in New Jersey he would always bring his kirn terrier Fergus. I was able to find a nearby motel that allowed pets on this site.
BringFido.com is a dog travel directory that provides information on over 250,000 places to stay, play, and eat with your dog. It has an online directory that includes more than 150,000 hotels, vacation rentals, bed & breakfasts, and campgrounds that welcome pets in more than 100 countries worldwide.
Bring Fido also has a Pet Travel Blog.
ALWAYS LEAVE ‘EM
LAUGHING
A husband and
wife were sitting on their patio enjoying a glass of wine. The wife said, “I love you so much I don’t
know how I could ever live without you.”
The husband
asked, “Is that you or the wine taking?”
The wife
replied, “It’s me – talking to the wine!”
TALK TO YOU
NEXT MONTH
Please share this “issue” with your friends and
family. Your comments on this issue are welcomed – email me at rdftaxpro@yahoo.com with BOBSERVATIONS COMMENT in the “Subject Line”.
Copyright © 2021 by Robert D
Flach
