Francetic Tax Resolution LLC - December 2020

DECEMBER 2020

262-752-6992

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THE MILITARY VEHICLE UNDER THE CHRISTMAS TREE

How My Parents Made My GI Joe Dreams Come True

How do you feel about skydiving? Some people love the adrenaline rush, but I also know folks who get shaky just thinking about it. When I was a kid, my GI Joe action figures had no choice but to enjoy the ride. They came with little parachutes attached, and I used to beg my sisters to throw them out of the second-story bedroom window of our house. I would wait in the yard below itching with anticipation, ready to snatch them out of the air. Usually they came floating down peacefully, but the parachutes didn’t always want to open up, so sometimes I’d have to make a mad dash to catch one of the Joes before he smashed into the ground or the wall and broke into pieces. If you can’t already tell, I was really into action figures as a kid, and the GI Joes were my favorite. The dolls were about 12 inches tall, and I had a bunch of them, including a clean-shaven guy and two Joes with bushy beards, one brown and one blonde. When I was little, I got GI Joe accessories for every Christmas and birthday. By the time I was 9, I had almost everything: the big tower they could rappel down from, the shiny hooded GI Joe firefighting suit and fire extinguisher, and even the astronaut suit and space helmet, which had a little glass visor you could flip up and down. The only thing I didn’t have yet was the GI Joe Mobile Support Vehicle, an awesome battery-powered yellow truck that Hasbro had just come out with that year. Luckily, Christmas was coming up, and I had high hopes it would be under the tree for me. When I woke up on Christmas morning 1972, I shot into the living room to scope out the gifts from Santa, and there it was — the best Christmas present ever! I’ve never been more excited about a gift. Even the little Matchbox cars I loved to get every year couldn't compete. The vehicle was just so cool! It had a searchlight on top that actually lit up and a radar that spun around like it was tracking down an enemy. I played with it all day and was obsessed for months. When I grew out of my GI Joe stuff, my mom kept it around. I think she was planning to pass it on to my kids, but they were more into playing with trucks than action figures. Eventually, the stuff ended up back with me. When I was tidying up my basement this last month, I pulled out the GI Joe Mobile Support Vehicle. It brought back a ton of good memories! I decided to look it up on Ebay, and apparently it’s a collectors item that goes for like $550 these days.

Still, I don’t think I’ll ever go to the trouble of selling it. It has a lot of sentimental value, and it’s still pretty cool!

I know this Christmas won’t be able to compete with Christmas morning 1972, but I’m still looking forward to it. My two sons and I are planning to have Christmas dinner with my younger sister and her family here locally. I hope that whatever your plans are for the holidays, you have a great time, too!

Wishing you the best,

Paul Francetic

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3 GIFT-GIVING TIPS THAT WON’T KILL YOUR SAVINGS

SET A BUDGET — AND STICK TO IT. Setting a holiday budget ensures you only spend what you can afford. It also narrows down your search. If you choose to buy your neighbor something, but they aren’t your top priority, set their budget at a lower level, like $25–$50. If you have a sibling who has had a rough year and you’d like to make their holidays a little brighter, bump their budget up. This narrows the focus of what you’re looking for so you don’t stumble into something you can’t afford. Ultimately, it’s the spirit of giving during the holidays that makes them so rewarding. With a little ingenuity, you can be generous and avoid the stress of excess debt come January.

Ah, the holidays. It’s a time of sweet treats, family, and giving back — and sometimes giving a little too much. When it comes to the perfect holiday gift, many people spend too much money. The average American spends nearly $1,000 on gifts during the December holidays alone! It’s possible to cut back and make it to January without major debt. Here’s how. CHECK YOUR LIST — TWICE! The list is going to be your secret weapon to tackling the holidays with your savings still intact. Start by writing down the name of every person you’d like to get a gift for. Now, with the exception of your immediate family members, narrow the names down to your top five — top 10 if you’re really popular. Now, place the names of the people

who didn’t make the cut into a second list. If you still feel the need to do something for them, send homemade cookies or a handwritten note instead of purchasing something. This limits how much you actually have to spend! THINK BEYOND STORE-BOUGHT OR EXPENSIVE ITEMS. Sure, everyone wants this holiday season’s “it” item, but sometimes the best gifts don’t even come wrapped under the tree. Instead, look to your own talents as a clue to what you should give. If you’re a great crafter, create something unique for the people on your list. If you can offer the gift of time, provide a free night of babysitting for your friends with kids or an experience at the local theater. These gifts have a bonus factor: Recipients love the gift when they open it, and they love it when they get to use it!

THE 12 TAX TO-DO’S OF CHRISTMAS

Will You Check Them All?

You’ve heard of the 12 Days of Christmas, but who really wants swimming swans and leaping lords? I’m a fan of practical Christmas gifts, so I’ve put my own spin on that old song and created my 12 Tax To-Do’s of Christmas. If you want to get a jump on the 2021 tax season, tick these items off before the end of the year.

Notify the Social Security Administration about name changes. If you or a dependent changed your name this year, tell the SSA so you can avoid issues with your tax return or delays to your refund. Renew your ITIN. Individual Taxpayer Identification Numbers (ITINs) expire when they’re old or unused. Visit IRS.gov and search “ITIN” to check on yours. Review your business. If you’re a business owner, look into your tax relief options. Are you overlooking any write-offs? Dodge holiday scam calls. Scammers love pretending to be the IRS. Don’t be fooled! Visit Consumer.FTC.gov for a list of common scams to avoid. Give tax-free gifts. As a business owner, you can give your employees holiday gifts worth under $100 tax-free! Just be sure to give items rather than cash or gift cards.

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Make green updates to your home. You can claim a 26% residential energy-efficient property tax credit if your energy-efficient improvements are installed before Jan. 1. Set your 2021 financial goals. How much will you contribute to your retirement accounts and emergency funds next year? Nail these things down now with 2021 tax limits and incentives in mind.

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Make last-minute charitable donations. The Coronavirus Aid, Relief, and Economic Security (CARES) Act is offering an extra tax incentive for charitable donations this year. If you take the standard deduction, you can claim a deduction of up to $300 for cash donations to charity. Contribute to your tax-advantaged retirement accounts. For 2020, you can contribute up to $6,000 (or $7,000 if you’re 50- plus) to your traditional IRAs and Roth IRAs. Update your address. If you moved this year, notify USPS, your employer, and the IRS that your address changed.

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Dig up your 2018 and 2019 tax returns. This will make filing a breeze!

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Make an appointment with your tax preparer. Tax season is coming, and I’m here to help! Make an appointment today so we can make sure your return is filed promptly and correctly, no matter how complicated it is.

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HOW TO REPORT A FORM 1099-A ON YOUR TAX RETURN IF YOU’RE FACING FORECLOSURE FTR TAX TIP OF THE MONTH

FESTIVE APPLE CIDER

We’ve made it through the most tumultuous year in my lifetime, but COVID-19 will have long-term effects on people’s finances. This is especially true for small-business owners, who were forced to close their shops temporarily and limit the number of customers they could serve. I hate to say it, but foreclosures are coming. If you’re facing one, the transaction must be handled properly on your tax return. For most of my clients in this situation, the biggest hurdle is the Form 1099-A (Acquisition or Abandonment of Secured Property). I recently filed 2017 federal and state tax returns for a client whose home was foreclosed on by their lending institution that year. Around the same time, they also took a substantial distribution from their 401(k). The home foreclosure triggered the bank to send my client a Form 1099-A. This form can seem overwhelming, but reporting it is fairly simple if you know the right steps to take. There are two important numbers on a Form 1099-A that need to be reconciled properly on your tax return to determine if you’ll be taxed on the acquisition or abandonment of your property. These are Box 2 (Balance of Principal Outstanding) and Box 4 (Fair Market Value of Property). Typically, they will both contain dollar amounts and the number in Box 2 will be higher than the number in Box 4. If that’s the case on your form, then you’re considered “upside-down” on your mortgage in relation to the property’s fair market value. There’s also a third and even more important number, which isn’t shown on the form. That is your “Basis in the Property” — the original purchase price plus any improvements made to the property over the years. If the basis is higher than the amount in Box 2 (which is usually the case), then you don’t owe any tax on the transaction. In the rare circumstance that the basis is less than the amount in Box 2, then a further calculation is needed to determine how much tax you owe. If you receive a Form 1099-A this year and are unsure about whether you owe tax because of it (or if you have a loved one in this situation), call my office. I can help perform the necessary calculations and file your tax return correctly.

Inspired by BoulderLocavore.com

If you’re cutting back on calories, skip the eggnog and buttered rum this year and fill up your mug with this delicious mulled cider!

INGREDIENTS

• • •

1 lemon

• • • •

2 tsp allspice berries

1 gallon pure apple cider

1 inch fresh ginger, thinly sliced

1 large orange, thinly sliced crosswise

2 tbsp honey

3 cinnamon sticks

2 tsp whole cloves

DIRECTIONS

1. Using a paring knife, shave the lemon peel off in curls. Reserve the curls and save the lemon for use in a different recipe.

2. In a large slow cooker, combine the lemon peel with all other ingredients. Cook on low for 3–4 hours.

3. If desired, use a sieve to strain the spices. Serve and enjoy!

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PRST STD US POSTAGE PAID BOISE, ID PERMIT 411

5429 DEERFIELD ROAD MOUNT PLEASANT, WI 53406-1919

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INSIDE

RETURNSERVICE REQUESTED

Listen to Paul Saturday mornings at 7 a.m. on channel 1050 WLIP-AM or stream online at WLIP.com!

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The Military Vehicle Under the Christmas Tree 3 Fool-Proof Ways to Pay for the Holidays Without Going Broke The 12 Tax To-Do’s of Christmas The Right Way to Report a Form 1099-A Festive Apple Cider

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The Surprising History of the Snowman

NOT JUST A CORN COB PIPE AND BUTTON NOSE

Building a snowman is one of the most picturesque winter activities, which is why snowmen have become a wintertime cultural icon. A snowman appeared on the very first postcards, was the subject of some of the earliest photos, and even starred in silent movies. Frosty may be a happy snowman now, but his ancestors have a much more varied — and sometimes dark — history. THE MIDDLE AGES Snowmen were a phenomenon in the Middle Ages. They were constructed with deep thought and great skill because, during a time of limited means of expression, snow was a free art supply that literally fell from the sky. These artistic feats were popular winter attractions for well-to-do couples who wanted to get their fix of temporary art. Snowmen were often created by famous artists, including 19-year-old Michelangelo who, in 1494, was commissioned by the ruler of Florence to sculpt a snowman in his mansion’s courtyard. THE MIRACLE OF 1511 In Brussels in 1511, during six weeks of subzero temperatures called the Winter of Death, the city was miraculously adorned with hundreds of snowmen. The spectacle told stories on every street

corner — some political and some demonstrating anger with the church, many too risque to speak of. For the people of Brussels, this Miracle of 1511 was a defining moment of artistic freedom. But when spring came and the snow thawed, the Belgians were left with damaging floods. THE SCHENECTADY MASSACRE Not all snowmen have an innocent history. In 1690, former Fort Schenectady in upstate New York was home to a remote Dutch settlement, which was under the constant threat of attack. Soldiers guarded the gates at all times because they were frozen open, but during a blizzard, they left a pair of snowmen to protect the gates while they sought shelter. That's when 200 French Canadian soldiers and Native Americans approached. Naturally, they were unfazed by the snowmen and ruthlessly invaded the settlement. Building a snowman seems like a simple and charming activity, but after learning about its surprising history, you might find those piles of snow seem a little more complicated and a lot more meaningful than before.

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