Hey, Where’s My Money?
Where’s the rest of my money?
What do you mean?
It says here I’m getting $9,000. I think that should be more like $18,000.
I was speaking to my brother. And the money wasn’t actually coming from him. He’s my accountant and we were discussing my taxes. My brother owns a CPA firm “Bliss & Skeen CPA.” The “Bliss” portion was my mother, who founded the firm. She’s been retired for years. My brother is the “Skeen” portion.
Mixing family and money is a often a volatile combination. When my mother ran the firm, it sometimes led to awkward conversations.
Well, I don’t really understand why you don’t have more money in the bank, given what you make.
After my brother took over, it improved my relationship with Mom and never became an issue with my brother.
Honestly, Rodney? They’re just numbers. I don’t even really pay attention to the amounts. I’m just interested in making sure we’ve claimed all the correct deductions and credits.
There are some benefits to having a brother who is a CPA. First, of course, is that I don’t have to do my taxes. I get the data to him and he fills out all the paperwork. My taxes have been complicated at times. I’ve had LLCs in my name, and I’ve written books with advances and royalty payments. I’ve been a 1099 employee keeping track of all of my own deductions. It’s not unusual for my tax forms to be literally a book that is 30-40 pages long.
But, the second, and better benefit is that I haven’t paid taxes in the past 20 years. Oh, I file my taxes every year. Or, rather, my brother’s firm files them electronically for me. But, when you look at the numbers at the bottom of the page, it never says, “You paid the government this much money.”
There are lots of reasons. I have a large family, so the child tax credit helps. I donate a lot of money to my church and other charities. I have a mortgage. And I have a really good accountant.
This year, I was surprised though. We bought solar panels last year. We rolled the $35,000 expense into a home refinance. But, we get a bunch of that back on our taxes. It should be close to a third. And it was that money that I didn’t see in my tax refund. My brother explained.
Yeah, so the solar panels qualify for a non-refundable tax credit. And it wasn’t $9,000. It was more like $11,700. But, the thing about a non-refundable tax credit is that it can only be applied to the tax you owe. After all the other deductions your tax liability came to $756. So, we applied the solar panel credit to that. The rest of it rolls forward to next year.
You’re telling me that at the current rate, I have enough tax credits for the next 10 years?
Pretty much.
It doesn’t even help if I cut back on my charitable giving, or other deductions. Neither would change my tax liability and so wouldn’t affect the amount of a refund. Of course, in the next 10 years my kids will be leaving home and I’ll lose those deductions. And at some point, I’ll retire (although not within ten years.) But, in the mean time That $10,000 stays with the government.
The only way I could get a bigger refund check is if the government were to increase my tax rate. Think about that for a minute. If the government raised my taxes, I’d get a bigger refund check next year. Like I said, it’s great to have a brother who is a CPA.
I haven’t paid taxes in the last 20 years and it appears I won’t be paying taxes for the next decade or so.
But, meanwhile the government gets to keep my money.
Rodney M Bliss is an author, columnist and IT Consultant. His blog updates every weekday. He lives in Pleasant Grove, UT with his lovely wife, thirteen children and grandchildren.
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