Friday, December 31, 2010

Zen Meditation Rituals

Tax season starts early for tax preparers. Catching up on all the new tax laws keeps my crowd busy from October on, sometimes sooner. By December 1st, preparations for the new tax season are in full swing: the new tax program is set up and tested, year-end tax panning extends the work day, and pre-appointments are set and mailed.

January brings the heavy workload of payroll reports and the first tax returns. Stress escalates as the demands on time rises; due dates loom around every corner make for long days at the office. And don't think performing at 95% will cut it. A 95% is an A in college, but a failing grade in the real world. Tax season is twelve weeks of final exams six to seven days a week and you are expected to get a 100% every day, every time.

Over my 27 years in practice I noticed a lot of tax professionals die young. Some live to a ripe old age, but all too many die in their 50s or early 60s. It also seems to me that many tax professionals die in early April when the biggest due date of all presses forward without mercy.

I attribute this unusual demographic to the building stress of tax season and the months spent locked in a room in a chair in front of a computer. If an animal were treated the way many tax professionals treat themselves someone would end up in prison.

The more vocal accountants seem to live longer; tax pros that beat the odds tend to exhibit a crankiness. Another type of tax pro that survives longer than the average is the one that learns to manage their time; no allowing the tail to wag the dog. I use several techniques to keep my sanity year round. Most days I take a walk in the park next to my office. If I have a ten-hour plus day, I take a walk.

Wisconsin can have nasty weather during tax season and a leisurely walk in the park is out of the question. I have a couch in a side room for a power nap, but power naps are difficult when a lot of things occupy the mind. This is where my secret weapon comes in.

Stress is the issue and sleep is not always the answer; reduction of stress is. I use Zen meditation rituals to reduce stress and get away from work for a while. Tax season or not, I use meditation. It relaxes and refreshes. Let me show you how I recharge with Zen meditation in ten to fifteen minutes.

Without any help from the boss (if you are not self employed like me) you can get a deep meditative break right in your office chair. Here is how: Sit up straight. Your back must be straight. Hunched over will not work. Your feet should be flat on the floor. Put one open hand in another and lay hands on lap. Touch thumbs to form an O with your hands. Close your eyes. Focus on your breathing. Count each breath in and out as one, counting to ten breaths.

Racing thoughts want to intrude. Do not push them away. Acknowledge the thought, then set it aside. The breathing and counting are not a contest or a speed race. When you count ten breaths, start counting from one again. Read detailed Zen meditation instructions here.

No matter your job, or even if retired or unemployed, stress is a cancer to a pleasurable life. Take a moment out to relax and experience pleasure.

For the tax professionals that frequent this blog, I know some of your concerns. How can I take a break? I'll lose clients if clients catch me taking a walk in the middle of the day when I should be working?

To these arguments I relate a story from the mid 1990s. While attending a convention in Dallas circa 1996, Nick Murray, author of Serious Money, made it clear for me. He said that no one client is worth your business. The client is NOT always right, especially if the client is asking you to sacrifice your integrity, disengage your family, or put your health at risk. The biggest client you have, Murray related, is not worth suffering over. Life is too short for such foolishness.

Tax pros should take note. Clients want us to work twenty hours a day without a break and do it for a smaller fee. No sane person would subscribe to such stupidity. Over the years a few clients have left because I demanded a short break. Good riddance. My sanity, family, and well-being are more important than another hour of work.

Everyone needs a quiet moment, especially in stressful situations. Practice simple Zen meditation techniques. The other option is to die young.

Wednesday, December 22, 2010

Four Smart and Effective Ways in Which You Can Get Tax Debt Relief

Today I have a special treat for you; Angela Brown is my guest blogger, providing solid information on IRS debt issues. Angela can be reached via the link in her bio.

Author Bio: Angela Brown is a contributory writer associated with a US-based debt consolidation non profit community and has written several articles for various financial websites. She holds her expertise in the Debt industry and has made significant contribution through her various articles.

4 Smart and effective ways in which you can get tax debt relief

If you have incurred a huge amount of taxes, it can soon get stressful for you to handle. It is not that you are the only person who has incurred tax debts with the IRS. There are many people who could not pay their taxes and have accumulated a huge list of tax debts. If you owe a huge amount of tax debts, your primary aim should be to pay them back and become debt free. But what would you do if you’re unable to pay off your debts on your own? Is there any solution to your IRS tax debt problem? Well, if these are the questions that are bothering you, you must read this article to gain some knowledge on paying back your IRS tax debts.
  1. Request for extension of limit: If your personal finances are in a state of haywire and you’re unsure about whether or not you will be able to pay your taxes, then you must request the IRS to extend the time limit of your debt repayment period. But always make sure that you apply for this request before the last date of payment or else your request might be rejected. The extensions may vary from 30 days to 120 days according to the kind of financial condition you are in.
  2. Penalty abatement: As you default on your IRS tax payments, there are various penalty fees that are added to your already existing tax amount. This may add up your tax to a huge amount and if you think that there is any mistake in the penalties that are added, you can legally request the IRS to remove them. However, before you ask for penalty abatement, make sure that you have all the documents at your hand so that you can give a proof of the suggested mistakes.
  3. Request for installment agreements: If your total tax amount is large and you are finding it difficult to pay it off at once, make sure that you ask the IRS to allow you to pay in installments. With an affordable installment agreement, you can pay off your taxes without straining your wallet. Let the IRS devise a payment plan according to which you can repay your debts affordably and become debt free.
  4. Offer-in-compromise: Offer in compromise is very much similar to a debt settlement policy that a consumer carries out with a creditor. The only difference is that this request is made to the IRS instead of a debt settlement company. This is a formal agreement where the tax payer offers to pay off an amount that is within his financial affordability. The IRS will accept your request only after reviewing your financial situation and checking whether or not you’re really able to pay off your debts.

Thus, if you’ve incurred huge amount of IRS tax debts and are looking for smart ways to becoming debt free, follow the ways mentioned above. Pay off your IRS tax debts and secure your financial life.

Friday, December 17, 2010

Wisconsin Jobs

Shhhhh! Here that sound? Do you know what it is? It is the sound of Wisconsin jobs getting sucked out of Wisconsin and ending up in Florida and Ohio.

Wisconsin has fared well in this recession compared to the rest of the United States but may do much worse in the ensuing economic expansion. Here is why.

Former Governor Thompson (R) wanted high-speed rail in Wisconsin and started the process to make it reality. Later, Governor Doyle (D) liked the idea and continued efforts to bring high-speed rail to Wisconsin. Since the Democrats decided they like the idea, the Republicans changed their mind; they no longer like the idea.

Governor Walker (R) has sent back the $810 million Washington gave to Wisconsin for high-speed rail. Instead, Walker wants to spend $1 billion of Wisconsin taxpayer's money turning a four-lane highway into a six-lane highway between Madison and the Illinois border. Wisconsin is a high tax state and it is about to get higher.

There are pitfalls to slapping Congress in the face for sending you money. Congress needs to cuts spending and you just volunteered. As a result, Congress just dropped a bill that contained a $5 BILLION contract for Marinette Marine. The contract could still be awarded in another bill later, but for now, the funding and Wisconsin jobs, are on hold.

I hate to say it because I love Wisconsin and the people here, but if you need a job, check out Florida or Ohio. The taxes are lower there and they have job creation right now, courtesy of the federal taxes you paid.

I bet the folks in Florida and Ohio don't even send us a Christmas card.

Tuesday, December 14, 2010

Second Chances

It looks like we the people will get a second chance to get our finances in order. Before year-end the tax bill that extends the Bush tax cuts for two additional years plus a payroll tax deduction of 2% should make it into law. This provides a massive opportunity for all of us to shore up our financial position.

The proposed tax bill will keep things like the child tax credit at $1,000 per child and lower tax brackets for income, qualified dividends, and long-term capital gains. In addition to the long list of extended lower taxes, the payroll tax will be reduced 2%. The payroll tax consists of Social Security (6.2%) and Medicare (1.45%). Your employer pays another 7.65% as well. The payroll tax deduction is a reduction of the Social Security portion from 6.2% to 4.2% for the employee only. This is a $1,000 tax deduction for someone earning $50,000 per year. You will see the additional money on each paycheck. If passed, the payroll tax deduction is for 2011 only.

Your Social Security benefits will not change due to the reduced payroll tax. The government will fund the Social Security Trust Fund from the general budget which means they will borrow the money to pay the trust fund.

Many Americans still have a personal finance mess on their hands. Years of overspending lead to a negative savings rate and high debt levels. The current low tax environment coupled with low interest rates is the perfect opportunity to pay down debt as fast as possible. It is only a matter of time before interest rates climb. Taxes must go up eventually to balance the books in Washington.

The debate about higher taxes is just that, a debate. The government is not taxing enough to cover Social Security, Medicare, Military, and interest. Defaulting on the national debt is out of the question as it would turn the U.S. into a third world country; Social Security and Medicare are sacred cows; and you can cut the military only so far before national security is at risk. Ergo, taxes will rise at some point in the future, whether they be income taxes or a value added tax.

It is easier to pay down debt when tax rates are low. When you keep more of what you make there is more available to reduce debt.

It is easier to pay down debt in a low interest rate environment. Payments apply more to debt and less to interest in such an environment.

If you have little or no debt, now is the time to build reserves for the day when interest rates rise. Tax policy can help you build that reserve faster and bigger.

Opportunity is knocking once again. It is wise to take advantage. The opportunity will not last forever.