ALWAYS PAY YOUR STATE TAXES FIRST FTR TAX TIP OF THE MONTH
I’ve been talking about the differences between the IRS and the state of Wisconsin on my Saturday morning radio show when it comes to tax collection. Even if you’ve heard this tip, though, it bears repeating: If you have a tax problem with both the IRS and the state, always, always, pay your state taxes first. A couple factors make leaving the IRS for last the smart path. First, the state of Wisconsin’s interest rate on outstanding tax debt is 18%. That’s more than three times the IRS interest rate, which was 6% in the first two quarters and is sitting at 5% for the third. Assuming the current rate holds steady, that works out to an IRS interest rate of about 5.5% per year on tax debt. You can see that with such a steep difference, it’s smart to pay the state first. Another factor to consider is the length of the statute of limitations on collection for each entity. The IRS statute of limitations is 10 years, but the state of Wisconsin doesn’t have a statute of limitations. Theoretically, that means it can collect on your tax debt until you die or even after that if you leave assets behind. By paying the state first, you might be able to work out an agreement with the IRS that will count your payment to the state as a monthly expense, similar to your rent/mortgage, car, and health insurance payments. If those combined payments are high enough, the IRS might deem you “Currently Non Collectible” and put your debt on hold. Keep it up for long enough, and you can let the IRS statute of limitations work in your favor, getting a significant amount of your debt waived. You might also qualify for an Offer in Compromise or Partial Pay Installment Agreement with the IRS by paying the state first. As they remind me every time I talk to them on the phone, the state of Wisconsin is well aware of their differences with the IRS when it comes to collection!
CLASSIC APPLE CRISP
What do you do when apples are in season but you don’t have time to make a pie? You opt for a crisp, of course.
5 lbs Granny Smith apples, peeled, cored, and chopped 1/4 cup pecans, finely chopped
3/4 cup all-purpose flour 1/3 cup brown sugar 1/4 tsp ground cinnamon
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3 tbsp all-purpose flour
1/4 tsp salt
2 tbsp maple syrup 1 tbsp lemon juice
6 tbsp chilled butter, cut into pieces
1/4 cup pecans, coarsely chopped
1. Heat oven to 350 F. 2. In a mixing bowl, mix all filling ingredients together. Transfer to individual serving ramekins. 3. In a different mixing bowl, combine flour, sugar, cinnamon, and salt for the topping. Mix
in butter until it forms lumps roughly the size of a pea, then stir in pecans. Sprinkle topping over filling. 4. Bake for 35–40 minutes, let stand for 10 minutes, and serve.
Inspired by Food Network
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