[00:00:00] Speaker A: You're listening to the Preferred Way, a retirement podcast brought to you by Preferred Trust Company, the preferred custodian for all alternative investments.
[00:00:10] Speaker B: Welcome back to the Preferred Way.
Or guess what we're going to be talking about. Hold on. Wait a minute.
Oh, procrastination. Yes, that's what we're going to be talking about because all of us do it. But there is a wrong time to do that, and that's around tax season. You know, the end of the year is coming, so you better quit procrastinating. I have Larry here with me today yet again to talk to us about all the reasons why we shouldn't procrastinate.
Larry, welcome back.
[00:00:41] Speaker C: Thanks for having me back.
[00:00:44] Speaker B: So here we are at the end of the year.
I can't imagine what the end of the year looks like for you, but really quick, when is your busiest time of the year?
[00:00:56] Speaker C: Oh, man.
[00:00:58] Speaker B: Oh, here it comes.
[00:00:59] Speaker C: Yeah, I feel like it's. I mean, either around the deadline because people are just like, reaching out random times.
[00:01:08] Speaker B: Is that April or October when you say deadline?
[00:01:11] Speaker C: Yeah, basically both.
So the March. So basically the March 15, April 15, September 15, October 15 deadline. So four, four, four times a year.
That week of that deadline is pretty crazy.
[00:01:25] Speaker B: It's pretty crazy. I have to imagine it is. But you know what's even crazier is that we're talking about 2026. Can you believe that this year has gone by so fast? It's incredible. Okay, so we're talking about 2026 now, but I have to ask you a question. If I file my taxes in 2026, I'm filing for what year?
[00:01:48] Speaker C: 2025.
[00:01:49] Speaker B: 2025. So guess what we need to do before the end of 2025?
We need to figure our out people. We need to make sure that we have all of our ducks in line because we're going to last minute, Larry. We're going to Last minute our CPAs, we're going to last minute our tax professionals.
And you better have your ducks in order. Quit procrastinating. You know, make sure that you have some sort of calendar in place to get all of your stuff ready. So, Larry, I have a question for you. For all the procrastinators out there, let's say I'm in March 2026.
We'll call it the last day of March.
I'm ready to send my stuff to you, Larry.
I'm that person. And I expect you to get it done by the 15th with all the other hundred clients that you have. Right? 200 clients. That are trying to push you to get April 15th.
What do you expect of me as a client if I'm going to put the pressures on you to get my stuff done?
What are your expectations of me?
[00:02:55] Speaker C: I expect a balance P and L and balance sheet.
[00:03:00] Speaker B: Okay.
[00:03:01] Speaker C: The financials in order.
[00:03:02] Speaker B: Okay.
[00:03:03] Speaker C: Expecting any, any IRS documents or, or 1098, 1099, W2, stuff like that. Sure. Like all that is, is provided at that point.
I mean those, those are, those are kind of the biggest things there because there's always going to be questions, so.
[00:03:24] Speaker B: Sure.
[00:03:25] Speaker C: There's also always gonna be something. Okay. At least we got those things covered. Like, hey, we got all the, all the, all the documents that were sent to them. They provide those to us and we got clean financials and we can kind of assess from there. So that's kind of the bare minimum at least think is reasonable at that point.
[00:03:43] Speaker B: Okay. What if I forgot to modify my company structure before the end of 2025? Can I still squeeze that in in March of 2026?
[00:03:58] Speaker C: No, you can't. Stuck with that one there. So.
[00:04:01] Speaker B: Okay. Okay.
[00:04:03] Speaker C: That's where like I said towards the, I said before the end of the year, if you try and do any entity restructuring is best to get that done before the calendar turns.
[00:04:11] Speaker B: All right. What else should I get done before the calendar turns?
Is there anything else? I mean, obviously my financials, I won't be able to produce until after, for the end of the year. I won't be able to get you my tax forms. What are the other things that I should absolutely not procrastinate about to get wrapped up before the end of the year?
[00:04:30] Speaker C: Yeah.
Say if you're, if you're in the S Corp or if you pay yourself a salary per se, make sure your payroll is all that is done as well obviously that filing because you gotta get your W2s out, your 1099s by, by January 31st. But having that stuff in order of, okay, who's paying what, getting your W9s out. So you're not having to hunt people down in January for their social or their, or their business. Einstein is, is huge as well.
The aspect of, hey, if you're going to put money into your retirement account, I mean there are certain accounts, you need to have something in there before the end of the year. Some stuff can wait until afterwards. But I say respect about any like from an employee standpoint. So you want to make sure that those type of contributions are done over the year or at least have the account set up like Just because you contribute after the year is in doesn't mean you can just open it up and apply. Like it needs to be open and in before the end of the year.
[00:05:31] Speaker B: Yeah. A lot of people don't realize that, you know, IRAs are a great example. Right. Have it open by the end of the year because the custodian is going to file a 5498 on it.
But the 5498s are not due until May 31.
And so it gives you a period of time to make sure that all of your assets are that are in that account are reported to the IRS for, for 2025.
And I think some people forget about that because as a custodian, I can't file a 5498. If you open the account in 2026, the account has to be open by the end of 2025. So if you're looking at utilizing that as a tax saving strategy, then make sure by the end of the year you get those open.
Definitely.
Just curious.
Do you have like a Procrastination 101 that you send out to your clients to say, hey, guys, it's ending the end of the near end of the year. Let's make sure we check these boxes because, you know, don't come to me in March 31st and expect that I'm going to work some miracles for you.
[00:06:36] Speaker C: Yeah. So at this time, like, we get in our, our kickoff emails, prepped request list, and then just pretty much setting our deadlines, per se. Hey, like, we can't guarantee filings by the 15th if stuff isn't in by two weeks beforehand. So we try to try to get stuff there in place. And then like, really just kind of leveraging, like repetitive emails AI to kind of help just keep. Get those same emails out over and over again. So it's, it's kind of just being annoying, but to their benefit, unless. Unless they know they go. A lot of our clients extend anyway because they're still just getting their books in order. So, like, step one hasn't really been done.
[00:07:19] Speaker B: Further, they're procrastinating.
[00:07:22] Speaker C: They still try and get the book. The book to Norris was like, well, we'll just follow this extension and keep it moving.
[00:07:27] Speaker B: Yeah, absolutely. Absolutely.
All right, I have a question for you.
How do you manage the amount of clients you have when all of a sudden they're like, they swarm in. You've got two weeks before a deadline. How do you get all of those tax returns done?
Do you have like an army of people that you're working with. How do you get that done? How do you manage?
[00:07:52] Speaker C: Yeah, yeah, we definitely up this, up the staffing during tax filing season.
But then to be honest with you, in talking to other tax advisors and all that, so it's like, hey, man, like, you gotta start setting some boundaries at some point because people will just kind of take advantage of that. So you're, you're trying to like, of like, hey, reset this and then hold it to it at that point. Like, because documents are signed, everyone agrees on the, on the procedures. Like you put this process in place if you're not going to like to follow it, like, why even like do it or have any processes in place. So. And it puts like undue pressure on the team. So it's like, okay, it's kind of like for no reason whatsoever because nothing was really gained from it and you get the potential risk of error. So like I say at one point we took pride in doing that was like, like, no. Like this is just, just chaos now.
[00:08:52] Speaker B: Yeah, it can get a little crazy. I can't imagine with the number of clients that you have, it's. That's gotta be a balancing act for sure.
Even if you do staff up, because the reality is you don't really know how many are going to extend. Maybe you do because you worked with them long enough that you know that they're procrastinators or don't have their shit together. But that's totally cool. Like that's what makes a tax professional's job expand throughout the entire year. Would you agree with me? Yeah. I mean, is there really a down month? Because the extension is what it is, that has another deadline.
[00:09:27] Speaker C: Yeah.
[00:09:28] Speaker B: But I'm sure April, May, June, July, August. Is there ever a month that you're not filing tax returns?
[00:09:34] Speaker C: No. And because I prefer, like I said, to get like stuff spread out throughout the summer anyway. Yeah. Just to kind of make sure things are like thoroughly done. Don't have that pressure on. Over, over right here. So, yeah, like, I don't think there's a month, even December, I think we're in the following tax return.
But like this, it's kind of the nature of, of the beast as a whole and just in society and people in general.
[00:10:05] Speaker B: So let me ask you a question. November, December, January, February, and in March were outside of deadlines.
So what are you filing during those periods of time? Extensions on an extension.
[00:10:20] Speaker C: Yeah. So like. Yeah, so some people didn't make the final extension. So you end up filing. Filing for those Sometimes gift tax return or trust or 990 that we're filing, so. Or there's some amendments that. That. That needed. That needed to be done because some new information came in.
So like I said, so it's always going to be something in particular.
[00:10:42] Speaker B: Always.
[00:10:43] Speaker C: It's just. Just shake of a bag and see what pulls that comes out of it.
[00:10:47] Speaker B: Absolutely. I think there's just a myth that, you know, there's six months out of the year, you guys just sit around and do nothing. I'm like, are you kidding me?
No.
There's people like Carrie out there that have, you know, companies that they invest in and, you know, they have filed their extensions and they decided to deliver that to you on October 15th. And, you know, at that point, you've already filed, but now you have an amendment, and, you know, it's material enough that.
That you need to amend and not wait until the next year. There's so many scenarios that I think so many of us don't think about, but procrastination upon procrastination leads to more procrastination. Right. And more delays. And so ultimately, I think in any.
I hate to say this, and you probably know this better than anybody else, but in any arena out there, no one procrastinates worse than individuals that need to pay taxes.
[00:11:48] Speaker C: You try to get the word out there, like, the extension doesn't extend the payment. It just.
[00:11:55] Speaker B: No.
[00:11:56] Speaker C: The filing. So, like, if you owe, you still. Oh, and now you're accumulating, like, penalties and interest.
[00:12:03] Speaker B: Yeah.
[00:12:03] Speaker C: At that point. Because the deadline to Pay is still April 15th.
[00:12:07] Speaker B: Yeah.
[00:12:07] Speaker C: So it's like.
[00:12:08] Speaker B: Yeah, that didn't go away.
[00:12:09] Speaker C: Best to put. Put something down.
But like I said, unless you're.
And as in. And I feel like.
I feel like March and April people are, like, doing refinances for some reason. Why? I feel like people are just constantly getting refinances done the first quarter of the year, and it's like. And they're rushing for a tax return. It's like, Like.
Like this. Like, this is not how it works.
[00:12:34] Speaker B: Crazy. Yeah. That's crazy.
[00:12:36] Speaker C: And then. Then the bank just asked for extension forms. Like, okay, here we extended.
[00:12:40] Speaker B: Yeah.
[00:12:41] Speaker C: Like, yeah, nothing. Nothing was really gained at that point.
[00:12:45] Speaker B: Yeah. What is the worst procrastination you have seen with a client where you're like, okay, I'm gonna pull my hair out if you do this information.
No names. No names, obviously. But, like, tell me a story where you're just like, what is going on?
I'm not a Miracle worker people. I can only do so much.
[00:13:08] Speaker C: Yeah. I mean, because one particular client where it's like, I. I thought they left. I didn't think. They never responded back to us. It's been like three years.
And then it was like, hey, yeah, like, I know it's been a while. We still got our. We still. We're still. We're still on. On. On.
[00:13:25] Speaker B: Oh, no.
[00:13:26] Speaker C: On. On engagement. We still want to work with you, but we need to get taxes filed. And this was like. I forgot. It was like a June or July of the. Of the third year. And it's like, we didn't file extensions of any of these other years. So you, like, you know, it's. I mean, anything is still going to be late filing anyway.
[00:13:47] Speaker B: Oh, yeah. Oh, yeah, you're gonna pay for it.
[00:13:50] Speaker C: They were trying to move and get qualified for this new home, and I forgot why. They just disappeared and personal situations and all of that. And it was like, Like, I get it. But like I said, they go dark on us is a whole, whole nother thing at that point.
[00:14:06] Speaker B: For three years, which is crazy.
[00:14:08] Speaker C: For three years, it's like, okay, give it year two.
All right, Then it's okay. We'll stop wasting time reaching out to him. And then out of the blue.
[00:14:17] Speaker B: Yeah, yeah. And procrastination will catch up with you. You know, I had a conversation with somebody. It's kind of interesting you say that. And they're like, yeah, it's been like four years since we filed our taxes. And I was just like, like, you know, you have that moment of like, whoa.
I think there's more individuals out there than we realize that have gone years upon years upon years upon years of not filing their taxes.
You know, you don't have to answer this question, but would you take on clients? Here we go. There goes Carrie. I'm going to ask it anyways. Would you take on a client that's like, you know, it's been three, five, six years talking about. We're talking about some serious procrastination here of not filing taxes for whatever reason. Who knows what the reasons are?
[00:15:05] Speaker C: Right?
[00:15:06] Speaker B: Yeah.
[00:15:06] Speaker C: I mean, I mean, we have. We took on clients who's. It's been like nearly a decade they haven't found.
[00:15:11] Speaker B: Wow.
[00:15:12] Speaker C: And like I said, just kind of unique matter. And we just kind of assess the situation and. And go from there where it's like, okay, they know they going to owe. We might as well just add up everything together and then just try to submit for whatever abatements and payment plans that could be, that could be put in place at that point. So. So like I say, but it's also, this is where like personality kind of comes into play there, where it's like, hey, this isn't about to happen in a month.
Like, yeah, we're probably talking about several months here. Make sure we got everything in order, everything in place, and if they are understanding of that, we can move forward. If it's like, I need this done next week. It was like, well, you need to go find somebody that can. They can today, then they can do it next week because we're not. So, yeah, not so much of the, the backlog of today tax returns is more so with the personality of the individual.
[00:16:10] Speaker B: Okay. And I can appreciate that because, you know, a decade could pass by.
The IRS hasn't caught up with them for whatever reason.
They haven't liquidated or I guess taken possession of property or done anything along those lines.
I guess the moral of the story here is procrastination is okay up to a certain point. At some point it might catch up with you. So before it does, you know, get things in place, get it in check, get it in order, because you still have time. Yes, it's going to cost you a little bit more.
But if you work with the right tax preparer or CPA to get it straightened out, there's a higher probability that it will get straightened out over time.
And so if you think it's too late or you've gone too long and you haven't filed the taxes, it really is never too late.
It could be when they start seizing your properties and taking everything you own away from you. But, you know, you know, take the first step because I have to believe, like you said, you know, even though there was a decade, you know, given the proper time and given a proper outlay of, you know, can you get any of those abatements, can you get any of anything reduced to the point where you're acknowledging it's happened, you're acknowledging that they want to pay. So let's get us on a payment planning. Let's get moving with this.
Maybe they pay it off in their lifetime, maybe they don't. But the fact that they're doing something illustrates, you know, some level of distance between somebody coming in and seizing your property. I have, I have to say. Right. Yeah.
[00:17:46] Speaker C: They take appreciation and provide some leniency if there's an effort being made.
Yeah, it's almost like, like a, like a. You just ghosted your ex, boyfriend or girlfriend. It's like okay, well, that's when, that's when things get ugly at that point. So they, they just want communication that, hey, you're working towards this, and they'll, they'll try to work with you on that as well.
[00:18:09] Speaker B: Yeah, totally agree.
So sounds like you're able to procrastinate for a little while. Hopefully you don't get caught, get your stuff in order and start making your payments. Because there's one thing we cannot, was actually two things we can't run from.
Both. Both unfortunate taxes.
And at some point, you know, our life comes to an end. So while you're here, realize that taxes are inevitable one way or another, whether you're getting a return or you're paying taxes.
There's different times throughout your life where you probably get a return and there's times throughout your life where you're going to have to pay taxes.
So the reality is the less we procrastinate, the more we'll be able to save in taxes. Right. Because we hit our deadlines, get everything in before the end of the year, and then, you know, make sure you're preparing for all of the machetes and steak knives that Larry's talked about in the past and prepare for those moments. Prepare for the fact that yes, you are going to have to pay taxes, but tax codes are created for a reason. Right, Larry? For you to figure out all the loopholes. No, I'm kidding.
I have a question. How many, how many individuals that are paying taxes, not using a CPA or tax professional know these loopholes? How many people sit there and study this IRS code?
[00:19:33] Speaker C: I mean, it's not too many lunatics out there.
[00:19:36] Speaker B: Not too many of you. No.
[00:19:37] Speaker C: Yes.
So it's like, hey, because it's. Especially now with like AI, like and chat GPT and everything. People just type in and whatever. But it's, it's aspect of kind of under, like reading it, understanding it, and how to apply it.
[00:19:53] Speaker B: Yeah.
[00:19:54] Speaker C: And that's where the proper strategy kind of comes into play. Like, yes, you can, you can Google whatever tax strategy is, but like, do you know how to properly align it to what you got going on so it can actually apply and actually be audit proof? Because at the bottom of chat GPT, every time you ask a tax question, it'll tell you to advise with a tax advisor. So it's still, it's still guarding against itself at this point.
[00:20:18] Speaker B: Absolutely. It has to. Right. Because otherwise it's going to be sued. So.
[00:20:22] Speaker C: Exactly.
[00:20:23] Speaker B: Nothing, nothing worse than suing virtuality.
And that's where. That's where I sense that this industry. Yes. I think that the industry as a whole, the communication that we're able to.
To get or the answers we're able to have from an AI perspective is very helpful.
But you're exactly correct. The implementation of it, you know, that's something that, you know, is taught, is learned through many reiterations of the tax code. How do you keep up with all the changes with the tax code? Is there. Is there some, like, underground, you know, communication porthole for tax preparers to say, hey, you want to make a little extra money with their clients this year, Introduce this concept like, where. Where is that information coming from? How do you get it? How do you apply it to your clients?
[00:21:14] Speaker C: Yeah, there's different types of continued professional education that we all require to get, but then kind of honing into whatever areas that you want to focus on. So.
And then really just constant wide network of other CPAs that we're all kind of connected to related person doing this and they kind of assess it. There's.
And to be honest, like I said, friends with many IRS agents and just kind of get their thought process on things as well, of like, what they look on the lookout for.
Because I say they, they don't want to just go out there and like, take my own people. They just try and get people who try and cheat the system. So, like, hey, they're doing this properly, then it'll be good to go.
Because if they are, if they are kind of looking at someone and there's nothing there, they're wasting tax taxpayer dollars if they're just kind of probed into an area where there's nothing there for them to get. So, okay, they're really trying to go up after more of the bigger fish and the bigger cheats out there. So once you kind of understand that and. And kind of have those relationships. Okay. Then you can start to kind of look at the code a bit differently and how to advise from that standpoint.
[00:22:25] Speaker B: Absolutely.
All right. Any other topics of procrastination? Any other stories that you're like, this is so crazy. I've been wanting to tell this story for a long time.
Anything else?
[00:22:38] Speaker C: Yeah, most of, like, procrastination. Procrastination stories is like, hey, it's been like a bad partnership and the partnership is illegal issues or it's a nasty divorce.
So like, that's creating because.
Or someone had a kid. So, like, where life becomes more important than taxes.
[00:22:57] Speaker B: Yeah.
[00:22:58] Speaker C: So it's like, okay, so that's where, like, it's understandable. That's a, that's an understandable excuse there.
But now how do we reel it in?
[00:23:08] Speaker B: Get back on track?
[00:23:09] Speaker C: Yeah, yeah, yeah. Because like you gotta get that stuff in track in order before you can move forward on any of that stuff. So like I said, something is, something is just part of just life or doing business with other people and having to maneuver around that.
[00:23:22] Speaker B: Yep.
So what I hear from you is, you know, keep a, keep a simple tax calendar. Something that key deadlines, make sure you hit them.
Keep all of your information in order. Like what's wrong with having a little tax folder on your desktop throughout the year? Put some information into it, be prepared, you know, make sure, you know, your contributions are either put in, ready to be put in plan for those. That's the other thing. Right. You can't decrease your income if you don't have the funds available to make the contributions.
That's something important to kind of remember, kind of running through a checklist here, you know, automate your reminders for your filings. You know, make sure, make sure you're ready if you have a huge year of income, you know, maybe you need to chit chat with your tax professional and find out if you should be making some payments throughout the year.
Not all of us are good budgeters, right. And so, you know, prepare, definitely prepare for that. If you can't and you had to set up payments, I'm sure, Larry, you can help them out making sure that they can set up some sort of payment structure. But you know, listen, just because you're making a lot of money doesn't mean you can spend it all because I'll be damn, Uncle Sam is going to be looking for some of it. So if you're not paying it through your traditional tax reporting mechanisms, maybe with your employer making, you know, quarterly payments, etc, you know, just don't, don't forget that, don't forget that the piece of, the piece of the pie is going to be expected at some point if you don't have machetes and steak knives to cut that down. So kind of keep, keep that in order.
And besides that, find yourself a good CPA or tax professional because there are a lot of tax code changes that have occurred like over the last decade that really are beneficial to U.S. taxpayers. And I think the vast majority of us don't use them because we don't know about them. We're not using AI, we're not educating ourselves, but we're also relying on ourselves to file our own taxes. So if you don't have a good cpa. You don't have a good tax professional.
You know, we have Larry on the show all the time because for a couple of reasons. One, he's just a down to earth guy, right? You can just sit down and have a conversation with them, you know, personal, professional, whatever it is.
He'll help you get your, your books in order, he'll help you identify opportunities, he'll help you save money in taxes.
So, you know, please reach out to him, give him a call and you know, do a little research before the end of the year. Don't wait until 2026, 2025 is still here today. So, Larry, before we end this, can you give people some contact information how they could potentially get a hold of you? If you're a procrastinator, call Larry. If you're not a procrastinator, call Larry.
[00:26:20] Speaker C: No, I appreciate you. They can reach out, check out the landing page, the investorcpa.com or they can reach out to one of my team
[email protected] looking forward to hearing from you and adding value where we can.
[00:26:37] Speaker B: We appreciate it. Thank you so much for this episode of the Preferred Way. Procrastinate, don't procrastinate. It doesn't matter. Taxes will still be due and they're coming soon. So be prepared. We'll see you next time.
[00:26:53] Speaker A: Thanks for joining us for another episode where retirement savers meet alternative investment.
Can't wait for the next episode. To learn more, visit our
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