Get Health Insurance!

A few years ago I was talking to a guy who HATES to wear his seatbelt. He is uncomfortable with it, never puts it on, and is willing to take a chance on his life if he gets into an accident. So needless to say, he also hates the “Click it or Ticket” law. His reasoning for not supporting that law was… ”How can you get fined for something that’s not hurting anyone? If I get in an accident only I will get hurt and I am okay with that risk!” Although I’m an avid seatbelt wearer, he made a valid point.

Well…the government has done it again.

President Obama changed the world of healthcare in the US by passing the Affordable Care Act (better known as Obama Care) in 2010. I won’t debate if that was a good or bad thing…but I will say something for sure – you BETTER get you some health insurance!

Whether it’s through your employer or not, the Obama Care program was implemented so everyone has health coverage year round. If you and members of your household do not comply, then you can be PENALIZED!

Yes, the choice to not have health insurance can cause you a tax fine. And these fines can be significant. (See picture below)

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The penalties have gone up significantly over the past 3 years. Isn't it worth saving money and your life to get health insurance? Open enrollment starts soon! Do yourself and your bank account a favor - GET HEALTH INSURANCE!
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The tax season has come and gone!! Now some people can breathe easier knowing that the inevitable task of filing taxes is over again until next April 15th!

There are others, however, that can’t breathe as freely because after filing their taxes this year, they owe the IRS! Are you wondering why you owe? How can you prevent this? Hopefully the tips below will help you!

Why do you owe?
1.       Changes in your life/tax return – Changes in your life can have an effect on your tax liability. Did you get married/divorced? Get a raise? Have a baby? Buy a house?
2.       Too little withheld from your income – Are your exemptions on your withholding form (W-4) accurate? That determines how much federal taxes are deducted from your pay check.
3.       Extra income with no taxes withheld - Do you work full time and have a part time job or consultant job? Did you receive unemployment or take some money from your retirement? Are taxes being deducted properly from your second job?
4.       Self-employment taxes - There is a self-employed tax rate that people often forget about. Your income is still subject to federal taxes.
5.       Not paying quarterly taxes – Unlike a paycheck where the government automatically withholds taxes, you get to see 100% of your earnings when you work for yourself.. You do, however, still have to pay taxes on that income (as mentioned above). As such, an entrepreneur should be paying quarterly self employment taxes.

How to prevent from owing in the future?
1.       Stay in touch with your accountant – Always stay in communication with your accountant/tax preparer so you can understand the tax implications of things that may change in your life.
2.       Re-figure your paycheck withholding – Recalculate your exemptions on your W-4 with your employer. Changing this will determine the amount of taxes withheld from your check; which will result in a higher or lower tax refund at the end of the year.
3.       Request taxes withheld from other income – If you anticipate getting any extra income as discussed above, be sure to request that federal taxes are withheld.
4.       Plan for small business taxes – Be sure to pay quarterly self-employment taxes. This will prevent a huge tax liability at the end of the year.
5.       Open home based business – Entrepreneurs have so many tax deductions. If time permits, perhaps look into opening a home based business to leverage the tax advantages AND make a few extra dollars!!

I hope these tips helped you and you can use them to prevent you from owing the IRS in the future!

(Note: these are general tips and not specific to any particular situation. Please consult with your tax accountant to consult with for your personal tax case.)

Did you know I discuss tips like this on periscope? For tax tips, entrepreneurship motivation, and small business advice, follow me on Periscope!

Being in love and married is a beautiful thing (so I’ve heard) …but a couple can benefit from being happily married AND separated. In the tax world, this is known as married filing separately (MFS).

The initial intentions for this filing method was for separating and divorcing spouses who were not willing to file their taxes together. However, there are other reasons people find this filing method beneficial.

One uncommon yet key reason married people file separately is if they suspect their spouse has been involved with tax fraud or evasion (currently or in the past). Filing separately will allow the innocent spouse to avoid any potential tax liability. There are other ways to avoid tax liability than filing separately if the liability isn't as serious as tax evasion. Consult with your tax preparer for these methods.

Even a happily married couple can benefit when filing separately. 
The main reason people chose to and benefit from filing separate is in a childless marriage when one spouse has a higher income while the other spouse has substantial potential for itemized deductions. For example, if one spouse has a lot of medical bills and a low income, this partner will likely meet the threshold required to be able to deduct these medical expenses on their tax returns. The partner with the higher income will have a higher threshold to start deducting these expenses and filing jointly will eliminate the chance for the lower income spouse to claim these deductions.

It must be noted that when married filing separately, both spouses must choose the same method of recording deductions. So if one spouse itemizes their deductions, the other spouse must do so as well even if their standard deductions are higher and will result in a greater return. In some cases, this can be seen as a con to filing separately. Some other limitations include the inability to claim the following: Earned Income Credit, Child Tax Credit, Child and Dependent Care Credit, Student loan interest deduction, any type of education credit, and elderly/disabled credit.

There are a lot of factors that goes into married filing separately. If the couple is unsure, it may be best to calculate the return both ways to see what will result in a lower tax bill. In general, couples with no dependents or no education expenses can benefit under certain situations. As always, consult with your tax preparer if you have questions.

I really can’t believe how fast this year has gone! And now it’s the most wonderful time of the year…it’s the holidays!! It’s a great time where people are happy, enjoy friends and family, and getting ready for the joys of a new year. There is one event, however, that people don’t think about and are usually unprepared for….tax season!

I know normal people don’t think about taxes until it’s forced upon us by the IRS. Well lucky for you….I’m not normal! (LOL) Taxes are something I think about daily so I can provide the most updated and tax advantageous methods to my clients.

With the tax season rapidly approaching, I have compiled a list of the top 8 tips to help you prepare for the tax season. This will make life easier on you and your tax preparer (if you chose to use one).
  1. Determine how you'll prepare your taxes - Are you going to paper or e-file yourself or hire a tax preparer?
  2. Think about and discuss changes in your filing status - Did you get married (...or divorced)? Did you have a baby? Did a child leave the house?
  3. Have a tax savings plan in mind - Are there additional tax deductions/credits that you qualify for that you always overlook?
  4. Gather all documents and file them while waiting on final documents to send to preparer - Documents include, but not limited to: W2s, 1099s, mortgage payments/interest paid, student loan interested paid, child care expenses, business income/expenses, mileage/auto expenses, etc.
  5. Take advantage of last minute deductions/credits to decrease taxable income or tax liability
  • Charityclean out your closets and garage and donate gently used items to a charity of your choice. A few bags full of clothes and household items can create hundreds of dollars of tax deductions (beneficial only if you itemize). 
  • Retirement money that you contribute to your 401(k) or similar employer based retirement plans is excluded from you income, thus, lowering your tax bill. If you’re not maxed out to your annual contribution, use the last few pay periods of the year to direct some money to your savings. You can also apply any year-end bonuses to your retirement plan as it will also be taxed as income.
  • Insurance if you have a flexible spend account that does not offer a grace period nor is eligible to rollover to the next year (up to $500 if your employer elects that option), then it’s time to clean out that account!
    6.   Small businesses: defer revenue, expedite expenses -  You pay taxes on money that you              earned for the year. If you have any last minute clients, allow them to pay early 2016 and              defer those taxes to next year. Similarly, expenses are deducted in the year you paid 
          them. If you know you'll need something for your business in 2016, buy it now if feasible.
    7.   Small businesses: send out W2s/1099s
    8.   Start planning for next year - Create a tax savings plan, adjust your W-4 withholding,                     create better organization/tracking methods, projection of quarterly taxes for small                         businesses.
I hope these tips were helpful and will prepare you for the upcoming tax season. If you have any questions, please post them in the comment section or private message me using the Contact page.

Someone presented me with the idea of creating a blog for my business. At first I thought it was an awful idea. Who in their right mind (besides me and my accounting friends) would want to read a blog about accounting?! But the more questions I received from friends, clients, and even random people about business startups, accounting, entrepreneurship, taxes, budgeting, etc. it dawned on me that there is in fact a need!

About me – My name is Pam Balentine and I am a CPA (certified public accountant) from Flint, MI, and I currently live in Atlanta, GA. I am the owner of Viking Financial Services where I provide individual and business tax, accounting, payroll, and consulting services in ALL states. I also partner with myEcon which is a company that provides people with a personal financial success system to help them minimize taxes, build business income, eliminate debt, and acquire assets. To learn more about the services offered, click here

In addition to operating my business I work full time as an Internal Auditor and Interim Plant Controller. I also volunteer and serve as the Student Member Services Director for the National Association of Black Accountants, Inc. (NABA) - Atlanta Chapter. I have over 10 years of accounting and auditing experience. The drive for starting my business is to take what I’ve learned and what I do for major corporations and bring the benefits, efficiency, and growth techniques to an individual and small business level. 

In my blog posts, I will provide tips, resources, motivation, and knowledge for the individual tax payer who wants to focus on saving and minimizing taxes and the business owner/entrepreneur who wants to grow their business and have the most efficient processes.

So stay tuned! If you have any questions or specific topics you would like me to cover in my blogs, contact me today!!