Blog

Tax Tips – Tips to Protect Your Financial Information When Shopping Online

Cybercriminals are looking for any opportunity to steal your tax and financial data. Theft of your Social Security number could result in a false tax filing. Take these extra steps to protect your financial information, Social Security numbers, and credit card data:

Avoid unprotected Wi-Fi. Unprotected, public Wi-Fi, available in coffee shops or other public places, could give thieves the ability to view your browsing activity.

Check your URLs for the “s.” If there is an “s” in “https” at the start of the URL, then the site is secure. There may also be a “lock” icon in the browser’s URL bar. Also, be careful making purchases at unfamiliar sites or clicking on links from pop-up ads.

Secure your computer. Lock down your computers, phones, and tablets using security software. This will help to protect your devices from malware that could steal data or infect the device with a virus.

Password length matters. Use a minimum of 10 characters or longer, with a combination of letters, numbers, and special characters. Avoid words, if possible.

* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov[7]

[7] www.irs.gov/newsroom/follow-these-tips-to-protect-data-when-shopping-online

Major Indices Have a Mixed Week WEEKLY UPDATE – MAY 6, 2019

The Week on Wall Street
Stocks were up and down last week, and the three major benchmarks ended up little changed after five trading days. The S&P 500 rose 0.20% for the week; the Nasdaq Composite, 0.22%. The Dow Jones Industrial Average declined 0.14%.

The MSCI EAFE index, a benchmark for international stocks, declined 0.21%.[1][2]

The Fed Emphasizes Patience
The Federal Reserve held interest rates steady at its May meeting. Its May 1 policy statement noted “solid” job growth and economic activity, but only tame inflation pressure.

While the Fed was not expected to make a move, some investors wondered if its latest policy statement might hint at the possibility of a rate cut later this year. No such hint appeared. Fed chair Jerome Powell told the media Wednesday that “we don’t see a strong reason for moving in one direction or the other.”[3]

Indications of a Thriving Economy
Employers added 263,000 net new jobs in April. Economists polled by Bloomberg forecast a gain of 190,000. The jobless rate fell to 3.6% last month, the lowest in half a century.

This better-than-expected employment snapshot comes on the heels of a first-quarter gross domestic product reading that surprised to the upside. In another bit of good news, personal spending rose an impressive 0.9% in March.[4][5]

Final Thought
On Wednesday and Thursday, stocks fell in the wake of the Fed policy statement. Friday, they more or less recouped their losses after the impressive April jobs report. Ups and downs like these come with the territory when you invest; the key is to stay patient and think long term instead of short term.

[1] markets.wsj.com/usoverview

[2] quotes.wsj.com/index/XX/990300/historical-prices

[3] www.bankrate.com/banking/federal-reserve/fomc-meeting-recap-april-may-2019

[4] www.nytimes.com/2019/05/03/business/economy/jobs-report-april.html

[5] www.marketwatch.com/tools/calendars/economic

Tax Tips – Tax Credit for the Elderly or Disabled

You may be able to take the credit if you are 65 years of age or older or if you retired on total and permanent disability and have taxable disability income. There are certain limits that your income cannot exceed.

Claiming the Senior Tax Credit if You’re 65 Years or Older
Based on your filing status, there are certain qualifications. If you are married, you and your spouse must file a joint return to claim the credit.

Claims for Those Under 65 and Permanently Disabled
You’ll need to procure a physician’s certification stating that you cannot engage in gainful activity due to your mental or physical condition, and in addition, that the condition has existed or is expected to exist continuously for a minimum of 12 months or if it is expected to result in your death.

You May Not Qualify Due to Taxable Income
You may meet the above qualifications detailed above and may still be ineligible for the credit if your taxable income exceeds certain limitations. To find out more visit https://www.irs.gov/pub/irs-pdf/p524.pdf.

* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.
Tip adapted from IRS.gov[7]

[7] www.irs.gov/pub/irs-pdf/p524.pdf

S&P 500 Reaches a New Peak – WEEKLY UPDATE – APRIL 29, 2019

The Week on Wall Street

Stocks returned to record territory, with both the S&P 500 and the Nasdaq Composite closing at historic highs. The S&P gained 1.20% for the week; the Nasdaq, 1.85%. The Dow Jones Industrial Average lagged, losing 0.06%. The MSCI EAFE index of international stocks lost 0.52%.[1][2]

The S&P took only 17 weeks to fully rebound from its December low.[3]
A Shift in Focus
Last month, Wall Street fixated on trade, reacting to even the slightest hint of progress in U.S.-China negotiations. This month, the trade talks have taken a back seat, and the fixation is on earnings.

Anxieties about a possible earnings recession may be fading. So far, first-quarter results for S&P 500 firms are 5.3% above expectations; that compares to a 5-year average of 4.8%.[4]

At some point, trade talk will come back, or other developments will lead Wall Street to chase other trends. The thing to remember is that Wall Street is fickle: what preoccupies it one week may be shrugged off the next. Short-term trends ultimately amount to background noise during the long-term pursuit of your financial goals.

A Strong First Quarter
Friday, the Bureau of Economic Analysis said that the economy expanded at a 3.2% pace in Q1. The number surprised to the upside. Economists surveyed by Dow Jones estimated Q1 gross domestic product would increase 2.5%.[5]

What’s Ahead
Investors have all kinds of news to consider this week. There will be a plethora of earnings calls, plus important reports on consumer spending and hiring. Also, Federal Reserve chair Jerome Powell will hold a press conference following the central bank’s May meeting.

[1] markets.wsj.com/usoverview

[2] quotes.wsj.com/index/XX/990300/historical-prices

[3] www.bloomberg.com/news/articles/2019-04-23/abyss-averted-in-stocks-as-valuations-and-rates-restore-bull-run

[4] insight.factset.com/earnings-season-update-april-26-2019

[5] www.cnbc.com/2019/04/26/gdp-q1-2019-first-read.html

Tax Tips – Tax Refunds

About 80% of Americans will receive a tax refund this year. If you’re one of them, you may have questions about “where’s your refund”?

It sounds obvious, but “Where’s My Refund?” is actually the best place to start. Visit www.irs.gov/refunds to find the latest refund information. Here are some common questions about the information that the IRS Where’s My Refund? service can provide:

When will my refund information be available? 

The information will be available 24 hours after you file electronically or 4 weeks after you mail a paper return.

How will I know my tax return is processed?

Where’s My Refund? will report on your tax return, from receipt to completion. You’ll find out whether your return is in received, approved, or sent status.

How often does “Where’s My Refund?” update? 

Once per day, usually in the evening.

Can I get information faster by calling? 

No. IRS phone representatives won’t have access to your refund status until 21 days after you filed electronically or 6 weeks after you mailed your paper return.

* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov[8]

[8] www.irs.gov/refunds/tax-season-refund-frequently-asked-questions

A Mild Week for the Market – WEEKLY UPDATE – APRIL 22, 2019

The Week on Wall Street

A short and relatively placid trading week wrapped up Thursday, with the major indices turning in mixed performances. The S&P 500 retreated 0.08%, the Nasdaq Composite advanced 0.17%, and the Dow Jones Industrial Average gained 0.56%. The MSCI EAFE index, tracking foreign stocks in developed countries, added 0.65%.[1][2][3][4]

Nothing really catalytic emerged to drive the market last week, and volumes were low.

Earnings Season Update
More than 78% of S&P 500 firms reporting so far this earnings season have surpassed analyst expectations, according to FactSet. Since guidance tends to be conservative, there is the possibility that more companies will beat forecasts than expected.[5]

The initial public offering market remained strong. Two high-profile technology companies came public on Thursday and were met with enthusiasm from investors. As mentioned in recent weeks, 2019 could be a banner year for IPOs.

Retail Sales Rebound
March’s 1.6% gain was the biggest monthly advance seen since September 2017. Sales of cars and gasoline rose more than 3%.

If the upcoming March consumer spending report is also impressive, concerns about the current business cycle peaking may recede.[6]

Final Thought
Nearly 800 companies will report earnings this week, including some high-profile names. This kicks off five weeks of active daily earnings reports.

Investors will watch corporate profits, guidance, and fundamental indicators with great interest, to try and glean whether the economy is strengthening or softening. Reports on first-quarter economic growth and existing home sales will command particular attention.

[1] quotes.wsj.com/index/SPX

[2] quotes.wsj.com/index/DJIA

[3] quotes.wsj.com/index/COMP

[4] quotes.wsj.com/index/XX/990300/historical-prices

[5] www.cnbc.com/2019/04/18/stocks-market-earnings-retail-sales-and-jobless-data-in-focus.html

[6] www.reuters.com/article/us-usa-economy-retail/us-retail-sales-post-biggest-gain-in-one-and-a-half-years-in-march-idUSKCN1RU1GI

Tax Tips – Making a Tax Payment

It’s that time again. If you need to pay this year, the IRS makes it easy for you to make payments. In some cases, you may be able to make installments if you’re not able to pay the full amount on time. Here are some ways to pay that bill:

Direct Pay: You can pay your tax bill online from a bank account with IRS Direct Pay. You’ll have the ability to schedule payments up to 30 days in advance, and there is an option for you to change or cancel your payment.

Credit or Debit Cards: Using your debit or credit card, you can pay your tax bill online, by phone, or with your smartphone. There may be fees that apply.

Installment Agreement: The IRS may arrange monthly payments if you can’t pay your tax bill in full. In order to use this service, you’ll need to have filed all required tax returns. Visit https://www.irs.gov/payments/online-payment-agreement-application to learn more.

IRS App: If you’re on the go, then the IRS2Go app may be for you. You can make payments and more. Download the IRS app from your favorite app store.

* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov[9]

[9] www.irs.gov/newsroom/easy-ways-to-pay-taxes

The Q1 Earnings Season Begins – WEEKLY UPDATE – APRIL 15, 2019

The Week on Wall Street
Stocks broke out of a narrow range on Friday following news that two major banks grew their bottom line in the first quarter. For the week, the S&P 500 rose 0.79%; the Nasdaq Composite, 0.91%. The Dow Jones Industrial Average improved 0.50%. Turning to overseas stocks, the MSCI EAFE index declined 0.09%.[1][2][3][4]

The market spent much of the week in a lull as investors waited for earnings season to begin. Wall Street is paying close attention to both guidance and profit margins.

Big Banks Post Solid Results
Friday, Wells Fargo and JPMorgan Chase both reported Q1 profit growth, and JPMorgan Chase announced record revenue.[5]

This was welcome news. Analysts have tempered some of their expectations entering this earnings season, recognizing that slowing global growth, tariffs, and dollar strength may be affecting corporate profits. The dollar rallied 6.2% in Q1.[6]

Inflation Picks Up
The Consumer Price Index rose 0.4% in March, the most in 14 months. This matched the consensus forecast of economists polled by MarketWatch, who believed rising gas prices would affect the number.

Even with this March jump, annual inflation remained relatively tame at 1.9%.[7]

What’s Ahead
Note that U.S. stock and bond markets will be closed on Good Friday (April 19).

[1] quotes.wsj.com/index/SPX

[2] quotes.wsj.com/index/DJIA

[3] quotes.wsj.com/index/COMP

[4] quotes.wsj.com/index/XX/990300/historical-prices

[5] www.cnn.com/2019/04/12/investing/wells-fargo-bank-earnings/index.html

[6] finance.yahoo.com/news/5-best-stocks-buy-ahead-122412306.html

[7] www.marketwatch.com/story/higher-gas-prices-boost-cost-of-living-in-march-but-inflation-still-soft-cpi-shows-2019-04-10

Tax Tips – Child and Dependent Care Credit

Working moms and dads can get a break with the Child and Dependent Care Credit. Child care is expensive, and this credit is designed to offset some of that cost. The credit covers children age 12 or younger, a spouse if they are unable to take care of themself, or any other person claimed as a dependent who can’t take care of themself. More details:

  • The total expenses that you may use to calculate the credit may not be more than $3,000 (for one individual) or $6,000 (for two or more individuals).
  • You must have paid for the care, so that you could work or look for work.
  • If you are married, you must file a joint tax return.
  • When filing, you’ll need to provide information on the caregiver, such as name, address, and Taxpayer Identification Number.

* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov[11]

[11] www.irs.gov/taxtopics/tc602

Special Update: Quarterly Report – WEEKLY UPDATE – APRIL 8, 2019

The Week on Wall Street
Stocks just posted their second straight weekly gain. Investors were encouraged by the latest jobs report and new signs of progress on a U.S.-China trade deal. The Dow Jones Industrial Average advanced 1.17% in five trading days; the S&P 500, 1.27%; the Nasdaq Composite, 1.72%. The MSCI EAFE index of international stocks improved 1.84%.[1][2][3][4]

The economy generated 196,000 net new jobs in March, according to the Department of Labor. Monthly job growth averaged 180,000 in the first quarter. Both President Trump and Chinese Vice Premier Liu He told the media last week that the U.S. and China were getting closer to a new trade accord.[5][6]

Meanwhile, a week into the second quarter, another earnings season is about to unfold. As we await results, we will take a brief look back at what happened in the first quarter.

Quarterly Update
Stocks staged an impressive comeback in Q1, recovering nearly all of the losses incurred in the last three months of 2018.

Bullish Sentiment Increased
Investors were able to set some of their recent concerns aside, at least temporarily. The Federal Reserve indicated that it would pause interest rate hikes, and while no U.S.-China trade deal was completed during the quarter, the ongoing trade dispute cooled. The economy seemed healthy: the jobless rate was under 4%, hourly pay was rising at more than 3% a year, and inflation was tame.[7]

Add in some upside from corporate earnings, and a recipe for gains emerged.

Stocks Had Their Best Quarter Since 2009
The Dow rose 11.15%; the S&P 500, 13.07%; the Nasdaq Composite, 16.49%. Additionally, this was the best first quarter seen on Wall Street since 1998.[8]

The Fed Held Interest Rates Steady
In March, the Federal Reserve left the benchmark interest rate alone and indicated that it would not make a rate hike this year. As recently as December, the Fed had forecast two hikes for 2019.[9]

What’s Ahead
The first-quarter earnings season kicks off this week with three big banks reporting results. The question is whether stocks in the S&P 500 will post earnings that beat analyst expectations to the degree they have in the past few quarters. Other questions: how will consumer confidence, wage growth, and job creation fare in Q2? Will there be a Brexit or a new U.S.-China trade pact this quarter, and if so, how will global markets react? If you have questions of your own as this quarter unfolds, remember that we are always here to talk.

[1] quotes.wsj.com/index/SPX

[2] quotes.wsj.com/index/DJIA

[3] quotes.wsj.com/index/COMP

[4] quotes.wsj.com/index/XX/990300/historical-prices

[5] www.cnn.com/2019/04/05/economy/march-jobs-report/index.html

[6] www.cnbc.com/2019/04/05/stock-market-us-china-trade-nonfarm-payrolls-in-focus.html

[7] www.usatoday.com/story/money/2019/03/29/dow-stocks-pace-best-quarter-decade-good-times-last/3311639002/

[8] www.usatoday.com/story/money/2019/03/29/dow-stocks-pace-best-quarter-decade-good-times-last/3311639002/

[9] www.usatoday.com/story/money/2019/03/29/dow-stocks-pace-best-quarter-decade-good-times-last/3311639002/