One of the biggest mistakes that people make with
taxes is getting a refund.
Yeah.
When you get a refund, you've allowed the
government to hold onto your money for a
year interest free.
And you earned nothing on it and you gave them too much.
That's exactly right
All because you want that thrill for five seconds if
you got a check, right?
That's right, so
That's right
I want people to get their money sooner to be
able to use it, so Rachael let me show you
the first example.
All right.
So the average refund is around $2869
Hmm
So instead of letting the government hold onto
that money, if you were to make adjustments to
your W4, you could get $239 extra dollars a month.
And so what you could do is if you got that you
could start to invest it.
Now what I'm showing you here is that 239 if it
were invested averaged out roughly is around
7 to 10 percent.
Hmm
But if you were to invest that $239 each and
every month, what you're noticing is the green.
The green sand is the return on your investment.
Right.
And so instead of you and Rachael..
Just a little bit of extra money a month if
you just made a small adjustment.
It accumulates over time
To your W4
It will accumulate, that's right.
The green is the return on that investment.
This is a positive for us, but if you let the
government hold onto it and you get it back at
the end of the year, look at what you get.
You get all of your money back but you don't get
any of the interest.
See that's how much cash you would
have if you let yourself..
That's right.
.. be the boss of your money.
That's what you're gonna be left with if you
let the government be the boss of your money.
You just have your money back, remember it's your
money. It's not a bonus.
You've worked hard for this money, so if you
were in this category and you're not sure go
talk to your HR director.
Yeah.
Or your tax professional, adjust your W4.
You can get more money coming to you sooner and
you can attack that save or this example, invest.
So this is
(audience clapping)
That's what it would have been had you not.
Yes, this is working for your money versus your
money working for you.
Oh Nate, well done.
( audience clapping)
Three filing statuses, you've got single, you've
got filing head of household and you've got
married filing jointly.
So let's take a look at the standard deductions you
could take if you were single.
The average person, average income in America is
around $50,000.
Mhmm.
Right.
So let's say they took the standard deduction of single of
$12,200, Head of household $18,350
or married filing jointly at $24,400.
Now people don't take into account life changes.
Right.
People get married, you have kids.
Yep.
You have different things that happen.
Yep.
But people will just pick them randomly without
understanding.
So the average return of someone making $50,000
taken the standard deductions of $7,200..
What we were just talking about, that's the 28
..is the $2,869 we were just looking at.
But take a look under head of household, it
would be $3,690.
Now we're gonna talk about head of household in a
minute 'cause this is the error people are making.
But if they were to file the taxes together..
Right.
..married filing jointly, you can see the
return would be $4,527.
It makes a difference in how you file.
A lot of people are just picking something randomly.
Right.
Now let's talk about head of household, this
one is a big misnumber.
Most people think if they're making money in
the home, that you're head of household.
Not so true.
According to to the IRS, to file head of
household you have to be single; you have to
be taking care of a dependent under the age of 19..
Right.
Oh, wow.
.. under the age of 24 if they're a
full time student.
Right.
But get this, your spouse is
never considered your dependent.
Hmm.
Huh.
Okay, so a lot of people will just pick this
randomly.
Right.
Oh.
And they end up getting in trouble by
not paying enough or getting too much back.
Yeah.
You get penalized.
I see.
But you can also be head of household if you
have a relative living with you when you're
taking care of them.
Right.
No one else is claiming them on their
taxes and they can't make more than $4,200
a year..
Under your roof.
..under your roof.
So it's a lot of things.
So if you had an elderly family member living
with you that would still qualify as long as
they earn under that..
Under that $4,200 a year. Yeah.
You could claim head of household as long..
Wow.
.. as no one else is claiming them.
The other thing for head of household is you
have to be paying up to half of the expenses for
the upkeep of the home.
Well, head of household.
Right. Correct.
That part I would guess.
Yes.
There's a lot of details in there I can see
people getting confused about or getting wrong.
Yes. Now a couple of other things.
You all know we've got a one point six trillion
dollar student loan problem right now
Oh.
One point six trillion
Yeah.
And it's back breaking for so many people..
It really is.
..because they don't really understand, all they're
paying off with their minimums is interest, interest.
That's exactly right.
Yeah.
But here's the thing, with taxes you can
actually deduct the interest without itemizing.
Huh!
Ahh.
Up to $2,500 in interest.
Now parents, if you're student took out
a student loan and is paying the payment, you
can't deduct their interest.
No, of course not.
Right.
Right, you can't but a lot of people..
It has to go to their child.
It has to be for them.
But here's another one Rachael, and they also
medical expenses can be deducted.
Huh.
So your income is gotta be over seven and
a half percent.
Okay.
Of you're income, those medical expenses.
Right.
But it's things that your health insurance didn't
pay for or your HSA didn't pay for.
Really?
So dental; a surgery..
A dental can knock you out.
Big time.
You're right about that.
So few plans even have..
Yes.
Exactly.
Absolutely.
So few plans even have dental.
Right.
So the big thing is taxes, there are a lot of nuances.
Right.
The main thing is don't do it alone.
Taxes are like us as individuals, it's all unique.
So there's no cookie cutter approach.
Mhmm.
You need to talk to a professional that..
( audience cheering and clapping)