Episode 56

Happy New (Tax) Year!

January 1, 2024

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Welcome to The Retirement Tax Podcast, where hosts Steven Jarvis, CPA, and Benjamin Brandt, CFP, work together to bridge the gap between tax professionals, financial advisors, and their mutual clients to help reduce most people’s largest expense in retirement: taxes. Each week, they will dive into conversations around taxes, focusing on what you can truly control (instead of what you cannot) and how to set yourself up financially for your future.

Ben and Steven are kicking off 2024 by helping you wrap up 2023 and look to the future. Just because the calendar flipped over doesn’t mean we can forget about 2023 quite yet. Make sure you are keeping track of important deadlines and on the look out for the tax documents you or your tax pro will need to get your 2023 tax filing done. Taxes will hopefully NOT be the most exciting part of your 2024, but small consistent actions over time will help make sure they are a little less painful this year.


What You’ll Learn In Today’s Episode:

  • 2023 deadlines that haven’t passed us by yet
  • Forms you need to be on the look out for to get ready for your tax filing
  • Information aside from the tax documents you need to share with your tax pro (even if that is you!).
Ideas Worth Sharing:

“The more proactive and intentional we can be, the better off.” – Steven Jarvis

“If there’s something we really want to do, maybe don’t wait till January 1st, just whatever that day is, just rip it off like a bandaid.” – Benjamin Brandt

“You don’t need to take every action on January 2nd, but if you don’t start making a plan now, you’re going to get to our New Year’s episode next year and wish you had done something differently. So we’ve got to put these things in motion.” – Steven Jarvis

Resources In Today’s Episode:
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Read The Transcript Below:

Steven (00:06):

Hello everyone and welcome to the next episode of the Retirement Tax Podcast, AKA the least boring tax podcast set in the bar, really high for 2024. And of course, Happy New Year to my co-host, Benjamin Brandt. Ben, welcome to the show.

Ben (00:22):

Oh, it’s a New Year. It’s a new me. It’s new. New opportunities to teach people how to retire and teach ’em how to not get killed in taxes so that they have even more money for their even better retirement. Can’t wait for 26 new episodes with you this year. 

Steven (00:38):

Absolutely, and since this episode is aired on January 1st day of the new year, Ben, I have to ask, what’s your take on New Year’s resolutions?

Ben (00:45):

Oh, New Year’s resolutions. Well, if that’s something you need, you should go for it. I mean, if you need a specific line in the sand to say, okay, New Year, new me, great. Anything that’s going to get you to commit to some new goals and it’s a bit of a gimmick with January 1st. There’s the age-old, the gym is never more full on January 1st and is never more empty on March 1st, right? If you need that, that’s for you. But every week starts anew, every month starts anew. So if there’s something we really want to do, maybe don’t wait till January 1st, just whatever that day is, just rip it off like a bandaid. But whatever works for you. I’m not here to judge, but I love resolutions. Maybe not New Year’s resolutions.

Steven (01:22):

Yeah, I’ve definitely had years where I specifically do New Year’s resolutions, but I’ve gotten to the point of I like to make changes in my life when the pain or other, hopefully sometimes positive emotion of making that change is present. And so actually early November was a recent one for me of, hey, there are some things I want to do to improve my nutrition so I could wait until January 1st, but hey, let’s get going unnounced. Alright, the New Year’s resolutions aside, if anybody listening is making them, we wish you all the best in getting through them and having a successful 2024. But what we want to talk about today, of course, Ben is taxes and 2023 is behind us. Now it’s in the rearview mirror, but that doesn’t mean that we get to stop thinking about taxes for 2023 quite yet. So we want to talk about what opportunities there still are and things we need to be doing to get ready for tax filing season.

Ben (02:09):

So the calendar flipped over and a lot of our advisors just finished their year-end tax planning for clients. So when December became January, we lost the ability to do some things, but some we didn’t, some until we file our taxes, if I’m understanding this right, in April, we can actually reach back to the prior year and do some interesting things. So maybe catch us up on what we lost access to, but what we still have access to looking into the prior year.

Steven (02:34):

Yeah, this is a topic I love to cover because the IRS doesn’t make it easy for us and so it’s important to refresh ourselves on this every year. And I’ll be totally honest, I have a cheat sheet. I don’t commit all of these to memory. A reference guide is probably better than a cheat sheet, but still, you’re absolutely right Ben. And this January to April timeframe, especially as we make contributions to tax-qualified accounts, we’ve got to be really intentional about making sure our documentation is just top-notch. Because in this January to April timeframe, it’s possible to either make a contribution to certain accounts still for 2023 even though it’s 2024, or we can go ahead and start contributing for 2024 things like IRA contributions Roth IRA contributions, if we’re doing backdoor Roth contributions, these are all things that even though it’s 2024 now it’s January 1st, we can still elect for a contribution to use up our 2023 contribution limits health savings accounts is another one.


And that’s a particular one that I think opportunities get missed on because a lot of times what I see is since the HSA limits go up every year, a lot of people will have their employer making a contribution for them, but it doesn’t necessarily fill up the full contribution limit. And so this is a great time to look at your final pay step of the year and to say, okay, did my employer really get the full benefit in there for me or is there a little bit that I can make up the difference? Because for 2023, if you had family coverage, you can get up to almost $8,000, $7,750 into an HSA for 2023. So if your employer stopped at 7,000, take the extra few minutes to contribute that last $750. That might not sound like a lot, but if we’re doing that every year, if we’re doing that over time, these are the small things that will start standing off the rough edges of our retirement tax bill.

Ben (04:21):

Yeah, you think about $300 a year times 10 years, that’s $3,000. And if we’re investing our HSA dollars and let’s say we earn 7%, we’re doubling it every decade. So that 3000 becomes 6,000. I mean we’re talking about meaningful money over time. And again, like you say, that’s sanding off the rough edges. Little things done consistently over time. When I hear you talk about HSAs every single year, I have the same conversation in my head is that I knew that I put some money in my HSA last year, but was it for actually last year or was I reaching back? Am I a year behind myself all the time? So I have to go into Fidelity and look at the thing and look at my taxes and try to figure that out. But my question is when we think about I want to make a deductible, IRA contribution, if my income is in the right levels and I’m doing my taxes in March and I want to reach back to 2023 so I can get that deduction and my limited to the traditional April 15th tax deadline, or what if it ends up that I end up extending, can I still reach back?


Is it traditional April 15th or just whenever I file my taxes? It looks like you made that point in our cheat sheet net, so I wanted to bring that to the audience’s attention.

Steven (05:24):

Yeah, that’s great clarification. For the most part, the way the IRS works, this is the earlier of when you file or the initial filing deadline without extension. So when we talked, you specifically said a deductible IRA contribution, if I file my taxes on March 15th, that was my last opportunity. I have to be able to report it on my tax return if I extend and don’t file until May or June or July, April 15th was still the deadline. And so this is one of those things where we don’t want to wait until the very last minute. Please don’t try to make your contribution on April 14th. Let’s give ourselves a little bit of leeway even if we’re going to extend. But knowing that we didn’t completely miss the opportunity on some of these things, we do have to remember that there are some things that we did miss the opportunity for 2023.


Really easy example is charitable giving. As far as the IRS is concerned, you get a deduction for charitable giving in the year that you actually donated the money. And so we can’t write a check in January to our favorite local charity or the church we go to and say, oh, hey, could you apply this to 2023? Nope. It’s the year we actually donate it. So some things do cut over with the exception of the first year we have to take RMDs required minimum distributions, those also have to be done by December 31st of the year. It applies to, so it can get really easy to get hung up on April 15th as they be all end all for tax deadlines, but December 31st is still really important.

Ben (06:50):

Yeah. Steven, you mentioned charitable giving and RMDs. One thing that we talk to clients about, and we generally end up starting it early in the year, is qualified charitable distributions. So we’ve got to match our qualified charitable distributions to total distributions and then at the end of the year, make sure that that satisfies those RMDs. And in fact, I think I’d have to look at the official ruling, but I think there’s an order of operations how they want to see you satisfy those required minimum distributions. When we’re talking about QCDs, I think this is based on a conversation you and I had a while back, but that’s why we tend to set up our qualified charitable distributions early in the year. So maybe do $50 a month to the Girl Scouts. Well, maybe we do a $600 qualified charitable distribution in January that gets our order of operations correct. And then there’s one less thing to do at the end of the year when we’re trying to satisfy whatever remainder that is.

Steven (07:38):

We do want to make sure we get the order and we want to start with that QCD. This is also a great reminder, especially as you talk about working with clients on QCDs early in the year. I mean, we have 12 months in front of us. The more proactive and intentional we can be, the better off. And so that’s another reason we’re talking about this as we celebrate the New Year here on the least boring tax podcast, is that even if there isn’t something you need to go back and do for 2023, now’s the time to start thinking ahead. You don’t need to take every action on January 2nd, but if you don’t start making a plan now, you’re going to get to our New Year’s episode next year and wish you had done something differently. So we’ve got to put these things in motion. 

Ben (08:14):

Anybody who’s raised kids can tell you that. How does the saying go? The days are slow, but the years are quick. I mean, you blink your eyes and we’ve been doing this, is this our third year of podcasting together? I mean, was it 21, 22, or no, 22, 23, and 24 years go by fast. So we’ve got to take action on some of these fun items that we’re talking about.

Steven (08:34):

Yeah, it does go real fast. So speaking of taking action, we of course want to remember that the other piece of the 2023 tax year not really being over yet is that that filing is coming up. The IRS does expect you to get your tax return filed, and there’s a lot of information that’s going to come together to do that. And whether you do your own taxes or you work with a tax professional, there’s someone in your life who needs all that information. So we want to spend a little bit of time talking about, okay, it’s January. What should we be on the lookout for? What kind of information do we need to be tracking and sharing with that special person in our life who’s going to file our tax return?

Ben (09:09):

And this is a lesson that I took from you, Steven and Retirement tax services, and a lot of the advisors that follow your ideas, we want to send to clients what we call a 1099 letter, but we want to send essentially a summary of everything that happened last year. So in addition to anything that changed last year, we want to send, and this is somewhat proactively to sort of rather than reactive phone calls, you want to proactively give this information away, but when can you expect your 1099? When can you expect K1? When can you expect I got a 5498? Do I need to do something with that? So remind clients what all these different forms mean and when you might get them and which ones are useful. But then anything that’s one-off, we did a QCD last year as a reminder, you’re not going to see the word QCD probably anywhere in your return, but it’s the non-taxable distribution. We did a Roth conversion, we withheld this much. Just a super simple summary of that. So you’ll see a lot of our advisors doing that, and a lot of that comes from Steven and his team.

Steven (09:59):

We want to be on the lookout for anything that’s summarizing money activity during the year. That’s a really broad way to put that. So let’s give some examples. So if you’re still working, that’s a W2. Most people don’t forget that they have a W2 coming, but any financial institution you have money with, whether this is a savings account with a bank money market accounts are actually paying more interest now. So you might need to pay attention to those a little bit. Retirement accounts, taxable brokerage accounts. There are so many different versions of the form 1099, why I call it a 1099 letter that we really need to be on the lookout for this. And the other layer of complexity now is that we do so many things online and maybe I’m the only one that’s guilty of this, but sometimes I don’t necessarily remember whether I opted into the paperless or not paperless or am I going to get it in the mail this year or is it only going to be online this year?


So again, whether we’re doing our own taxes or we’re working with another professional, we’re going to set ourselves up for success by proactively saying, okay, what are the accounts I had money in at any time during the year? Don’t forget about closed accounts or rolled-over accounts. I mean there could be activity for an account that’s not still open, but we want to go back and make sure we’re checking online that we’re obviously paying attention to the good old snail mail if we’re still getting some of those documents in our mailbox, but that we’re gathering these documents. And really, I like to encourage people that January is really about gathering those documents. And as we get into February, we are more likely to have everything we need to start filing that tax return.

Ben (11:25):

And this is not a race to the finish line. I’m sure we will talk about this later at the end of the winter or the coming spring, but there’s no reward for being the first guy at the IRS with your completed tax documents. We hear this every year. Somebody completed their documents and then they get that final 1099 or revised 1099 or something like that. So what are some of the, I dunno if there’s a hard and fast date, maybe there is, but we’ll start to see those documents in probably the end of January, early February. But is there an official cutoff that our brokerage students have to get those documents to us?

Steven (11:59):

So typically we’re going to see those by the middle of February. I’ll be totally honest, but there is an official date. They’re supposed to have it out by the first time and I always forget what it is because they don’t really take it seriously because they’ll get the initial document out. And then this last year was terrible for it. I don’t know what it was in particular, there’s a couple of custodians that immediately come to mind. I won’t name them that they were sending us amended 1099s in late March and early April. It was driving me nuts. And so they technically met their deadline in February, but then just said, oh, whoops, my bad here, let’s change it all.

Ben (12:29):

Again. That’s just a reminder. There’s no rush to do this. If we do it too soon, we get a 1099. We weren’t expecting it. We just have to go back and redo some things. So yeah, we should just keep that in mind.

Steven (12:39):

And so as I work with clients, we generally, it can feel like a hurry up and wait kind of situation. We want to gather those documents. We want to be proactive. We’ll even go through and prepare the return, have everything just right at the finish line and then we’ll say, okay, let’s just pause and wait a few weeks because we’ll have that conversation, make sure we know where everything’s at. But again, like you said, there’s no award for finishing first and we’re better off making sure we have complete information. Some exceptions to that. If we have a client who because of their circumstances during the year is expecting a big refund, there’s something else in there that we want to go ahead and get things filed. One exception I can think of that is hopefully pretty unique and it doesn’t apply to many of our audience members, if you’ve ever had issues with identity theft related to your tax return or in situations where you have less than friendly former spousal relations with dependent kids, I guess is the right way to say it.


When there are legal debates about who’s claiming dependents, that’s also a situation where we will try to file a little bit more quickly to make sure that we’re claiming the social security number. But thankfully, that’s the exception and not the norm for most of my clients. Hey, let’s give ourselves the time to make sure we have all the right information. So Ben, something else I always like to throw out here because we’ve been talking about the official forms that you should be looking at. I guess one reminder on that, we talk about 1099s. Not every custodian will label it as, Hey, this is a 1099. It might be your year-end tax summary or a consolidated tax statement. We’re looking for those types of documents that we want to make sure we’re holding onto. And then the other thing is that there can be a lot of things that happen during the year that you won’t get a tax document for that you still need to tell your tax preparer about, whether that’s you or your working with a professional, things like changes in your marital status, changes with your dependents.


That could be kids moving off to college or finally being off mom and dad’s payroll and supporting themselves for our retired audience members, that could be that you have a grandkid who is now a dependent for you. And so any changes like that and our family situation moving is always a big one that we want to make sure that we’re talking about, especially if you’re moving out of state and what that might imply. Changing jobs, retiring, these are things that we might not get a specific tax form for, but we want to make sure that we’re really aware of as we go to file the tax return.

Ben (14:56):

When we think about kids in college where they might live part of the year somewhere else, or they might live part of the year in our home, or same with grandkids. Steven, what’s your litmus test for? Yes, I can confidently claim them as dependent and then are they going to file their own taxes or not? Or how do we know if we’re in the realm of dependents or not?

Steven (15:14):

So the general starting place, especially if we’re talking about kids and grandkids, it gets a little bit different if they’re not your children. The rules are a little bit stricter, but the general starting place, are you providing more than half of their support? And it gets a little bit more complicated if they’re college kids or not if they’re living with you or not. But that’s at least where we need to start is are you providing over half of their support? And then again, there’s some limits on how much income they can have and we need to make sure we understand if they are filing their own tax return, did they acknowledge on there that someone else is claiming them as a dependent? But if you aren’t providing for half of their support, it gets really tough to claim as independent.

Ben (15:53):

And so we could look at potentially what if they’re living at our house, what that might cost if they’re living somewhere outside of our house, groceries, things like that. If we can add all that up and say, okay, this is 51% of all of the monetary resources they used in a year, then were not being fraudulent. Were legitimately claiming independent.

Steven (16:11):

Absolutely. It doesn’t have to be that you are mailing them checks every month to provide for their support. Like you said, Ben, it can be I provide their housing, I provide their food, all those types of things. And if they’re in college, you can be paying for things on their behalf. They might not necessarily have to even be living with you. But yeah, that’s kind of the first hurdle we’re looking for is are you providing half of their support?

Ben (16:29):

Okay. Are there any documents that we’re going to receive from a custodian that we don’t really have to include with our tax returns? I’m thinking of IRA-specific forms. Oftentimes I get questions that say, I have this form, it looks very official. I should profile with my taxes in some way. But sometimes that’s not the case.

Steven (16:50):

So I think specifically you’re thinking of the form 5498, which is a form that gets issued for a variety of different accounts including IRAs. And in theory, as a tax preparer, I would love to have that form as I’m filing the taxes. The timing never works out like that, and it’s not something that you technically need to have. It’s more informational. So my recommendation is that even if your taxes have already been filed, that’s something you should absolutely share with your tax preparer, but not something you should wait on to start your filing. Sometimes those come out well after the tax return deadline. And again, it’s more informational and not necessarily required to get the filing done.

Ben (17:27):

And correct me if I’m misremembering, but that’s got your account balance on it, right? Contributions potentially beneficiaries I think as well. What’s all on the 5498?

Steven (17:36):

Yeah, it’s going to show contributions, it’s going to show rollovers, it’s going to show for IRAs, it’s going to tell you if it’s a traditional or Roth IRA. It’s going to give you that December 31st balance. It’s kind of like a year-end account statement for retirement account. The timing of when it actually gets released is usually just not helpful for the tax filing itself.

Ben (17:54):

Well, Steven, anything else that you can think of that you’re excited about tax-wise for the brand New year?

Steven (17:59):

Maybe not excited about, but one thing I like to bring up often this time of year is that unfortunately there still is a lot of fraudulent activity that goes on around tax returns and the fraudsters out there know that this is the tax time of year. And so we want to make sure that we’re being diligent about really thinking about the emails we’re receiving, the things we’re getting in the mail, that we’re not clicking links. We don’t recognize that. We’re remembering that the IRS is never going to call and ask us for payment information or for our social security number. The IRS always starts with a letter to us. We just want to be extra vigilant this time of year that we aren’t inadvertently putting ourselves in a world of hurt by falling for one of these schemes that are out there.

Ben (18:34):

That’s a fantastic reminder.

Steven (18:36):

Well, Ben, so excited to kick off the New Year with you. And until next time, just remember to not let the tax man hit you where the good Lord splits you. 

Steven (Disclaimer) (18:45):

Hi everyone. Quick reminder before you go. While Ben and I feel very strongly about the information we’re sharing on this podcast, it is for educational purposes only and should not be taken as specific tax, investment, or legal advice. You need to make sure that you are working with a professional to evaluate how these concepts apply to your specific situation before you take action.

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