Dr. Friday Radio Show – June 13, 2026
Dr. Friday uses this final live radio broadcast to focus on tax planning before major life events, especially selling property, inheriting real estate, transferring family homes, and updating estate documents. She explains why basis, appraisals, trusts, POD designations, and powers of attorney matter before a family is forced to sort things out after the fact. The episode also includes caller questions on inherited property and prize winnings, plus reminders about marketplace insurance, Medicare IRMA, IRS identity checks, and business recordkeeping. Summary Points Home sale basis: Dr. Friday reviews the primary residence exclusion, explains that the old rollover rule is gone, and reminds homeowners to document major improvements that increase basis. Inherited property: She explains step-up in basis, why the date-of-death value matters, and why appraisals can be stronger support than rough comparable sales after repairs are made. Final live radio show: Dr. Friday tells listeners the show is moving off 99.7 and toward DrFriday.com, where she plans to keep answering questions and sharing tax education. Family property transfers: A caller asks about homes titled in her parents’ names, a long-running purchase arrangement, quitclaiming property, and how inherited homes differ from property she has been buying. Estate documents and gifting: The episode covers trusts, wills, POD designations, powers of attorney, probate risk, and situations where beneficiaries used gifts after taxes to honor a parent’s wishes. Prize taxes and records: Dr. Friday discusses lottery withholding, St. Jude home raffle tax questions, 1095-A marketplace repayment surprises, Medicare IRMA, IRS identity checks, mileage logs, receipts, and home-office rules. Episode FAQ Q: Do I owe capital gains tax just because I inherit real estate? A: Dr. Friday explains that inherited property generally receives a stepped-up basis, so capital gains usually become an issue when it is sold for more than its date-of-death value. Q: Do repairs after inheriting a home increase the inherited value? A: She says the inherited value is based on the condition and value at death, so later improvements should be tracked separately and the original value should be well documented. Q: Why should estate documents and POD designations be updated? A: Dr. Friday explains that courts and financial institutions follow the paperwork, so outdated documents can leave beneficiaries trying to fix things later with gifts and tax filings. Transcript 00:01 No, no, no. She’s not a medical doctor, but she can sure cure your tax problems or your financial woes. She’s the how-to girl. It’s the Doctor Friday show. If you have a question, Question for Dr. Friday, call her now. 737-WWTN. That’s 737-9986. So here’s your host, financial counselor, and tax consultant, Dr. Friday. Dr. Friday and the doctor is in the house. We are here today to take calls talking about taxes, talking about maybe making some planning. You know, taxes are great, but normally we’re doing taxes after everything’s already happened. So if you’re really thinking about taxes, you’re probably thinking about 2026. You need to put some plans into play to say, how am I going to pay less in taxes? Can I pay less? Is it better to pay more today and pay less later? If I sell this, if I inherit this, if I convert this, will any or all of these be good or bad things? Again, I don’t really have the perfect answer for you because I don’t know what you’re going to buy, sell, or trade. But if those are things that you’re thinking about, then those are the kinds of things you do need. 01:18 to make sure that you’re accounting for. I’ve had more than one person come in and they have sold their primary home or they’ve sold a piece of real estate Or even inherited property. And they’re like, well, I I shouldn’t owe any taxes, but you know, just because you people tell you you don’t owe taxes doesn’t always mean you don’t owe taxes. So, I mean, you can sell your primary home, but if you sell it for $800,000, you purchased it for $200,000 and you’re a single individual. There is a one-time exclusion of 250,000. Well, 200 plus 250 does not equal 800,000 So you would end up with a capital gain situation. And for any of you are sitting there thinking, but wait, as long as I spend the money within the next two years or put the money back into another piece of real estate, I don’t have to pay the taxes. That tax law died a long time ago. That was something that was actually back in the early 2000s that has not been in existence for a long time. Tax law now is if you sell your primary home You can take your original cost basis and that would include the land and some people built their own homes. And then any major improvements that would have increased the value of the home. 02:36 For example, an extension, or if you’re on piece of property and you built some barns or um or you gutted the kitchen so you purchased the house back in the 80s and and then you redid the kitchen um now that would be a better upgrade so therefore the house would be worth more money so Those are the kinds of things. So also for all of you that are listening, you might want to think about if you’re actually living in a house that you own or purchasing along with the bank for most of us. You might want to document those things, right? Because I have people that’s lived in their homes for 20, 30 years. And let’s be on it. You’re not going to remember everything you’ve ever done to increase the value of your property. You fenced in the properties, you put in a swimming pool, you You know, you you did different things. You took a gravel driveway and now it’s an asphalt driveway. When you purchased it was gravel, now it’s asphalt. That increases the value of the home. So these are the kinds of things you need to document as well. Now, as long as you’re living and that’s what you’re doing as far as selling your property, that’s fine. Now, if you pass away and you leave that real estate. to um whoever your beneficiaries are, they’re going to get what’s called a step up in basis. But one of the things I’ve noticed lately is A number of clients, they inherit the property. 03:56 And keep in mind, it’s what the value of the property was at the time of inheritance, is what your value is. Not after you’ve put $50,000 into that home and increased the value by another $150,000. Because when mom was living in the house, for example, um, she was older, she wasn’t able to maintain the property the way it should be. A lot of things went bad or got old or even, you know, had holes in the floor and bad doors and all those things. And you said, hey, you know what, if we go through and we put a little money in this house, we could get a lot more money out. Great idea. But keep in mind, the value of the home was not the value after you improved it after the passing of that individual. The value that you get of the home was before that happened. So this is one of the big things the IRS has really come down on is a lot of times people are taking comps, but the problem is the IRS is finding that many of the homes when people have lived in them for 30 years have not been maintained like the other comps you’re pulling. So it’s very important to really start getting into appraisal so that the appraisal that comes in you can justify your basis, not just a comp. 05:14 Now, if there’s somebody that you know that can do a uh appraisal based on, you know, the roof is 30 years old, the house is fifty years old, uh, you know, all these different things that come into play because a lot of times people will say, well, I matched it up to another three-bedroom, five bath that’s sold right around the time of the passing And it’s roughly the same square footage. But was it built at the same time? Was it actually had the same kind of maintenance? Because again, as people get older, it is something that, you know, that the house can get away from them So, um, if you are an individual that is uh going to inherit or have inherited um a property It’s a great idea, don’t get me wrong, fix it up and then sell it and put the money, you know, double your investment, which many times can be done with some really decent improvements But um otherwise sell the property before you fix it up and then you don’t have to worry about capital gains. That’s your two options. But uh don’t fix it up and think that Al after you fix it up, now you get 100% tax write-off Because the tax law is coming back and saying, nope, we found out a lot of people are trying to do this. And so they are, you know watching and looking. 06:26 And again, when we file our taxes, it’s not like we want to sit there and say, what can we get away with? We want to file taxes that we can put to bed And that, especially if it’s a an estate tax return, because as a beneficiary or the executor especially, you have legal obligations to make sure the information is to the best of your ability correct But either way, you want to make sure that all of that information is being put together and that it’s being documented and that you’re able to submit that along with everything else to the beneficiaries so that they know how much money they’re going to end up being taxed because everyone always thinks all inheritance is zero, which a good chunk is, which is really nice. If you think about the step up and basis you get, that is about one of the best tax laws that’s on the books right now. Um versus, you know, like an IRA that you inherit and then you only have 10 years to basically empty it. Um, and that’s that’s not an easy thing to do. There are some games people will play, part of it going into charity, charitable remaining trust, different things like that where you can um donate a big chunk of it, but it doesn’t mean that you’re going to put all that money in your pocket and pay no tax. All right, so if you want to join the show you can six one five seven three seven nine nine eight six six one five 737-9986. 07:50 I will tell you guys, this is my last live show. There’ll be no more uh Dr. Friday shows on 99. 7 unless I’m a guest on somebody’s show Um, the this is gonna be we’re gonna be moving fully to the internet, trying to, you know, keep the subjects going, have it a little bit more um ability to zoom in on just the topics that we want to talk about, taking your guys’ phone calls and then being able to really target those conversations. um and not worry about the time or the uh the the rules that we have per se but mainly um I’ve loved doing my radio show for the last I don’t know I was trying to figure out how long I think it’s been at least 15 years maybe more And um it’s been a pleasure having all of you guys listen. Many of you guys are my clients, so I’ll still be seeing and talking to you guys all the time. And if you have questions, you’ll be able to go right to the internet And we’ll be able to do them just as we’ve always done here on the radio and give you the one-on-one that you need. But just so you know, it’s going to be at drfriday.com. That is where you’ll want to sign up. We’ll be getting some sign-ups so that way we can notify you when we do have live blogs going and and just different things like that. So hopefully you guys will continue to follow me. 09:09 I know it’s been easier on the radio, but You know, um, with the current technology and everything, it’s just gonna be time for us to try something new, you know. You gotta every once in a while you can’t get stuck in a rut and just have it go that direction. And I have really enjoyed doing the radio. It’s it’s taught me a lot and you guys have taught me a lot. So I really hope that we’ll be able to continue this into um the next phase that we’re all going to go through, which is going to be the internet. So we’ll see how that works. But you can always go to drfriday.com. Just remember that and you can follow us and we’ll be able to get you linked into all of the different ways of trying to help you um do things or you know I want I love answering your questions and I I’ve always enjoyed the ability to help help you guys hopefully before mistakes are made to give you the ability to think or ask questions or do something like that. So whatever you have there. All right, let’s hit Trish before we have to hit our break, if you don’t mind. Hey Trisha, what’s going on Um yeah, I have a question. Um if I inherit, like I we’re getting ready to do the real flash trust for my parents and um they have a home, my brother has a home and apartment and I have one as well Um, but they’re all in my mom and dad’s name. 10:24 Um scary, I know. But I’ve been paying on my nose for thirty seven years They to turn it over into my name, I don’t know it am I gonna have to pay capital gains tax on that when I they turn it over into my name? Like well I’m I mean I’m not sure. Yeah. Exactly. Okay, so basically, I mean you’ve had um a le uh a land purchase from you to your parents, and I d I doubt that they’re reporting that as income and that you’re purchasing it. You know, I mean I don’t know. Maybe they have. Um if it’s been been reported that way, then it’s no different than me purchasing my house. Your parents are just your mortgage company And um so they just need to uh quick claim the title to you and they can keep a lien, but maybe I mean you’re at the point where you’ve pretty much paid off uh the property probably. So at this point They will quickly and you should have nothing because you’ve paid the full price or whatever agreed upon price you’ve paid now maybe worth a lot more today than it was when you purchased it from your parents back, I think you said 30 years ago. Um So whatever that time period. So basically whatever you paid for it, they need to quick claim it to you for. So that way then, yes, when you sell it, if you ever sell it, whatever the plan is. 11:41 Um, you know, you’ll be able to um sell it just like all orestos. There would be the two hundred fifty thousand or five hundred if you’re married uh exclusion and then you can sell. But are they all tied? I I mean do you have your own plat? Like are each of you guys on your own property? As far as yeah, can you two of the houses are on yeah, two of the houses are on one property and the other was mine is on a separate piece across the street. But my my fear is I mean I inherit the homes because I’m gonna inherit two of ’em Am I gonna have to pay capital gains of like 37%? Like a million dollars? No, because uh when you inherit them, you’re gonna get the value of what they’re worth now, not what they were worth The house that you’ve been purchasing, that’s different because that’s been a deal between you and your parents. But the ones that are just inheritance, inheritance gets to step up in basis. So you will have nothing as far as capital gains unless you sell them for more than they were worth at the time of death. Okay. I don’t plan on selling them, so I won’t have to take capital gains on them if I keep it. No. Exactly. No, you will not. Thank you. No problem. That’s a I’m glad I can give you a little relief. I literally can’t. 12:55 All right. Thank you. Thank you. All right, we’re gonna take a quick break. 12:59 We’ll be right back with the Doctor Friday show. 13:07 Alrighty, we’re back with the Dr. Friday show. Sorry about that. I couldn’t tell when it comes in. Um if you want to join the show, you can. 615-737-9986-615 737-9986 number here in the studio. We’re talking about my favorite subject, which is taxes. It’s gonna affect every single one of us. It even affects us as you can see Even when we’re not here, the people we leave behind are going to end up with some tax issues depending on how you set up your estate. And sometimes you really have very little option unless you want to pay the taxes before you pass away, there is uh always going to most likely be a part of our our inheritance that will end up partly taxable But if it’s handled right and handled with a um a good set of yeah I I’m a huge uh believer in a trust. For most people, a trust is just easier. And to be quite honest, it also allows you, even when you’re not here, when you’re no longer uh on earth, allows us to be able to um Still steer the ship, I guess you would say. Still make sure that what you wanted done even after you’ve passed away because the problem I always have with a will, plain and simple, it’s gonna go through court Court is made up of judges and and other people. 14:22 And sometimes people know how to play the system. And so if I’m not there to represent myself. A someone has to be paid to do that, which is kind of crazy, um, because I already told people what I want, but if somebody wants to contest or question what I want, then you’re in a situation where you’re like, okay, now I’ve got another problem, right? Now I’ve got to deal with this issue. Whatever it is, it still needs to be dealt with, which means you have to hire an attorney to speak on the behalf of the person that has passed away. So that being said, the next thing you really want to do is make sure that you have everything in order. And that’s easier said than done because as we start getting older, things are changing. Right? I mean when you’re in your 30s, 40s, and 50s, basically your main concentration is your spouse or your children or your parents, whatever. just taking care of those immediate. But then as you get older, you’re going to start thinking about what can I, what do I need to have? What kind of documents do I need to have signed? to make sure that there is someone there that’s going to be able to answer the questions when needed, right? Because if I’m incapacitated, who’s going to tell the doctor I do or do not want certain things Because I don’t want them, you know, but that there’s no way of them knowing. 15:36 Um, so you have to have power of attorney for somebody else to be able to do that. It’s that simple You need the ability to give someone the authority, someone you know that will say, I do not want to be resuscitated. I do, I don’t want to be kept on a life preserv a life machine or I do um all these different questions are going to be asked because the job of the doctor let’s just be honest their job is to do what you want but also to the best of their abilities But they don’t know what you want. So they’re going to go and do a hundred things that maybe you didn’t want done, or they’re going to, I hate to say this, look at your insurance and say, oh We can’t use this particular procedure because they’re not insured with this kind of company. Those kind of things. And then also, who’s going to take care of you as you get older? You’re going to be able to keep home care Are you going to need to move to a facility? If you move to a facility, are you going to need to sell your home so you have enough money to pay for the facility? These are all kinds of decisions and sometimes hate to say it, but sometimes the client is no longer there mentally to be able to make some of these decisions. So you as an individual in this world um need to think about this and I would say think about it when you’re younger not I know I say as you get older yes it’s normally we hope that none of these things are needed until you’re 80 years old or 90 years old. 17:00 And at that point you may need some more assistance, but we none know when the big guy upstairs are gonna decide to do these things. So I suggest at least having your first draft done as soon as possible. I don’t do this. It’s not something I’m marketing you to do. I’m suggesting it because I’ve seen so many different people come into my office. And they had to probate things, but they weren’t able to find any kind of well, so you can’t probate easily. Now now the courts and the state of Tennessee is gonna tell you what’s gonna happen, even though you might have known what your parents or your mother or whatever. But, you know, or I mean I’ve had so many cases also that’s come in because obviously when we do taxes, we do estate tax returns. And, you know, I have one recently where her mom had put her down as the beneficiary and then mom had remarried. And um and Daring, uh, she outlived her her new spouse and the the spouse she had um had had a a daughter as well. And um Mom had talked to her daughter many times, telling her she really wished that everything could just be split evenly between her and her s her half sister or whatever. 18:16 Um not too sure the exact because they weren’t really related, but to her spouse’s daughter as well. And but she never changed the POD or paid on death of her IRAs or anything else So at this point, thy client comes in and says, hey, you know, um everything’s coming to me, but I know what mom wanted. And I know even though the will and the trust all them doesn’t say what mom wants. She knows that mom had had, uh wanted to change everything, just never really got to it. Um, and so we we set up a gift tax return, right? And we we gift we after my client paid taxes on everything. She accumulated the differences and then she honestly split everything in half at that point. I give her a lot of kudos because um, you know, it wasn’t She didn’t have to. She felt she had to. And I agree. I mean, mom told her what she wanted, even if the will and the courts, because Mom only had a will, so it had to go through probate and everything. And she tried to bring it up in probate, but the fact is she said no one wanted to hear. what mom wanted, they only saw the document that basically said everything was left to me, which was really done before she even remarried. 19:36 So these are the kinds of things you don’t want your kids to have to go through. That’s all I’m saying. If you’re young and you happen to be listening to this station, think about who do you want to take care of your children? Because if you don’t leave something in the proper order with the proper documentation, The courts will most likely give them to somebody, but will it be the person that you guys want? And you’re all sit here and say, well, we’re young. Why would we worry about because every day people pass away. Not everybody is old and and done with life. Many times it’s middle, prime, young, you know? I mean, and let’s pray that never happens. But on the other side of that conversation, let’s prepare for the worst and live for the best, right? I mean that’s always uh saying my dad used to say, you know, I mean, prepare for the worst, but then go out there and live the best you can. And that seems like a really good attitude. It worked for him, seems to be working for me. And hopefully it will work for some of you guys that are listening. So if you want to join the show, you can. 737-9986-615-737-9986. This will be our last show on air So if you have questions after this, you can easily just go to drfriday.com. 20:49 That is my website. Has been forever. And you can ask questions through the website. We’re going to have a lot more live blogs and different things going on. We’re just moving more that direction. But you know, we’re still here to answer and help educate all of you guys. You have been awesome. Hopefully you will continue to listen. Um through the internet and we’ll be able to get you uh more and more information. And like I said, if you’ve got questions, you can join the show right now, 615-737-9986, or you can send in an email Friday at drfriday.com again friday at drfriday.com and that way you can always um because you know questions happen all the time something comes up something changes Someone says something and you’re not sure if it really applies to you, and please check those out. Whatever your neighbor is doing, whatever your best friend is doing, I’m not saying isn’t 110% correct But may work for them, but because of either your income bracket, the filing status that you work with, um there’s many different elements that could be even if you both seem like you’re pretty much at the same point in the same place. doesn’t mean it’s going to work for both of you. 22:04 Tax law is not black and white. It’s not like everybody that is this is going to get this much money. I mean, basically you can count on the fact that you’re going to pay taxes, but there could be different taxes. You have AMT tax, and of course, if you’re in the marketplace, you can end up with the extra tax that you didn’t pay because you understated your uh health insurance. That is a huge thing. People are still using the 1095A marketplace. And I don’t know, I’m not an insurance, so I don’t know if there’s better options. I hope there are, because I know I use a health savings account, uh, HSA, and I use Farm Bureau. Awesome, works good And the prices are very nice, but um again, nothing fits everybody, but the marketplace when it’s based on your income, You know, I’ve had people having to pay $20,000 back because they sold some rental real estate, didn’t think about it, and then they realized that the market, they hadn’t told the marketplace because they didn’t think of it as earnings This is a one-time situation. Oh, there is no excuse, no penalty. I mean, no way of getting out of that penalty. The black and white is they paid for insurance on you. 23:18 And at that time, the person was paying like $23 a month. Um, and then they sold this real, you know, sold this real estate and ended up making some good money, kicked them into and they owed it $20,000, which they didn’t count on. When we were estimating their capital gains, we didn’t think about estimating marketplace. It’s a lot like Irma, right? So if you make a lot of extra money and you’re on Medicare, a lot of times people don’t think about estimating the IRMA effect. because uh your Medicare is means tested. So if you make uh a big chunk of extra money, that could affect how much money you’re gonna pay in Medicare for the next year after And it always feels like it’s almost two years because you have to wait through the year you did and then you file and then it doesn’t really catch on till a period later. So it often feels like it’s a little longer than it is. But Making sure you’re making those estimates before you make those decisions. Understand how your taxes are going to affect you is really what we love doing. And it’s really what the whole purpose of tax planning is. Tax planning is trying to figure out what’s the best way to put everything into a Roth IRA, to figure out when you’re gonna sell all your real estate, when you’re going to retire, when you’re gonna start Social Security. Million questions come to mind whenever I think about. 24:34 What am I going to do next? What’s the next step and how can I save money? When should I start doing it? And what’s the best way to go about it All right, we’re gonna take our second break. 24:44 You can certainly join the show. 615-737-9986. We’ll be right back 24:52 Alrighty righty righty we are back here live with the Doctor Friday show. You can join us if you have a question concerning taxes or maybe you’re dealing with Some sort of a state situation and you’re not sure which way to go, or maybe you just have a story you want to share. 615-737-9986-615. 737-9986, taking your questions, talking about my favorite subject, which is taxes, which you know what I’ve always found pretty amazing that a lot of you guys actually enjoy it as much as I do Let’s be honest, we’re a little bit weird because who wants to talk about taxes every Saturday? Um, but all my listeners do, and you guys have always been pretty cool. And I like uh talking about taxes mainly because it affects every single one of us, even if you don’t think about it. You know, when you go to the grocery store, you pay tax, sales tax, or You go to dinner and you pay sales tax or liquor tax. And you go to the petro station and you pay gas tax. Um, lots of taxes in our world. Um, some of them get to be tax deductible. If you own a farm and you go out and buy farm diesel, you can ride off the gasoline. If you use your vehicle 100% for business or you’re riding miles because you are using it partly but you’re able to do miles all of these different ways help reduce your taxes now keep in mind if you’re a regular employee because this one gets asked a lot if you’re on a W-2 And you use your own vehicle, it is not going to be any kind of major tax advantage. 26:24 One of the problems we also have is like my truckers. So my truckers used to be able to take a per diem because they spend the night in their truck. But unfortunately When they change the tax law, that fell off the books, cause most of the my truckers are many of them. If they’re not um self-owned, they’re W-2s and those individuals end up with a different situation. So a lot of people have lost some of those tax advantages, but hopefully we’ll be able to find some different ones. Looks like we have Milton. Is this my Milton on the phone? This is your Milton and this one talking to my girl Dr. Friday You got it. We’ve been together a long time, Millie. A long time. I sit here. I’m I’m moaning right now because I’m saying, oh no, you’re not leaving. No, no, no. That’s all right. We’ll just have to get you listening to me on the ra on the computer instead of on the radio. Well you know I will. You know I will. Hey, I got I got two hypotheticals for you and uh one that we’ve been talking about. Let’s let’s go with the first one I’m gonna give you a hypothetical. I won the lottery, I got five hundred thousand dollars, they took out taxes, so now with what’s left over When I at the end of the year, do I have to add that to my income where I’m paying more taxes on it? So what you actually report is the five hundred thousand plus the estimate because we what you didn’t really pay taxes but you made an estimated payment so that estimate would go against it and hopefully it’s enough but I did have a situation where the person was 120 000 short 27:57 of what the IRS did not take when they did the original estimate. Oh good. So you could end up owing more money. So don’t go spinning it all, as that particular client did. um and uh have to go back and take a mortgage on your house. So yes, if you win the lottery, they will take an estimate, but don’t assume that that estimate is going to cover everything. It’s a lot like if you have a 401k or an IRA and they take out a uh 20% because you told them take out so much for taxes, it may or may not always cover all of it. That’s what I that was my next question. How do they know what to take out as it relates to the estimate? It’s the same way as with your four oh one case or your IRAs. You tell them I um want twenty percent, I want twenty-five percent You know, if you’re smart and you made five hundred thousand, I’d probably go with the highest tax bracket, thirty-seven percent, just to be on the safe side, and then you can get the refund back Okay, next question. As you know, because it’s been all over television, Saint Jude is raffing out that uh you pay a hundred dollars, you can move into a nine hundred thousand dollar home, I think that’s located in Franklin Those whoever wins that whoever wins that, what kind of taxes are they having to pay and do they have to report it on their income r uh uh re uh in terms of whoever wins that Well, I’ve always wondered about that, Melton. 29:16 That’s a great question. So I don’t know. I mean if it’s a normal lottery, the answer is they got it for a hundred dollars. So they have uh eight hundred and ninety-nine eight hundred and ninety thousand dollars whatever they have to pay tax on um and many times you hear people when they win a car they have to sell the car to pay the taxes right so that is a possibility but i’ve also heard someone say that it’s gifted from Saint Jude to the person. Now if it’s gifted, that means Saint Jude paid the taxes. And the You know, uh because a lot of the people that built that home did it under a charitable deduction from their companies, because I have dealt with some of the people that help with those projects. And so their corporations are taking their labor and cost directly against charitable contributions. So um I I actually think they’ll end up paying tax on it. I mean it’d be great to win it, but then you it could really mean that you have to go get a mortgage to actually do something with it. Yes, because every you know, it’s been they’ve been doing it for year and it’s it’s a good cause. I I love what they’re doing and I love what they’re doing. I give it every year. Yep. Yeah. Never wanted. see that they’re helping the children out but I’ve often wondered whoever wins that and I’ve I’ve seen over the years different people win it and I often wonder what kind of taxes are they having to pay on it or, you know, at the end of the year or whatever. 30:35 And it’s just I was always curious about it and I sound like you have been too. So I guess you know, that’s just one of those things. But it but it makes sense I’m sure Uncle Sam’s gonna get their share out of it, but I think like what you said with a lot of people doing this as a private donation St. Jude may be the one to go ahead and pay the taxes because I think they’re probably gonna get about maybe two million dollars out of this from what it sounds like Oh yeah. That’s what it sounds like. I mean that’s a wonderful and I mean and like I said, the people building the house are all donating to this. So St. Jude gets all two million dollars. the castle constructions and all them that that participate in the the decorating the building of it, they all take on the cost as part of their charitable deduction. So it’s a it’s a fabulous way. Uh I’ve always wondered if anyone has actually moved in or if they’ve all ended up selling them. I’ve never looked into it, but it would be an interesting, yeah. Good question. Okay. Hey, well thanks so much. And like I said, it’s been a great fifteen years, but you know, I’m not saying goodbye. We’re just saying so long for now. All right, until you beautiful wife I said hi. I definitely will. Take good care and have a good day. All right. We’ll talk to you later. Bye. Okay. Bye bye. All right, guys, and that’s uh yeah, one of my best friends. 31:49 Okay, so um we are on the Doctor Friday show, and that was two awesome questions. Um I’ve had the same kind of wondering, especially if you win something that I mean, I’ve had clients win the lottery and in those cases they file W9s um or W4 forms, I think I think it’s a W9 actually. I think our client had to fill out. And it just told them how much to withhold taxes on, anyways. And in the case of the one that didn’t He had not come to me until after the fact I would have told him that 15% tax on 250 grand or whatever it was was definitely not going to get in the ballpark So you definitely need in those cases, even before you go pick up the money, in my personal opinion, get your attorney and your uh accountant on the phone, tell them that you’ve won, and then find out what you should be doing before you go and pick up the money because once you pick up the money that’s when they’re going to want you to fill in documents. You’re going to need to know what to do. Is it better to move that into some sort of trust or outside your basic information because you also could have a lot of people probably calling you saying, oh, we can help you spend that money, we can help you invest, because it’s kind of public knowledge. Not something I’d want So if uh if you’re lucky enough to win, that’s awesome. 33:06 I think that’s always. And I and anyone that um does participate in the uh the charities that are around. I mean that’s that’s always that’s the win is the help the charities. But I mean some some of these places um have come up with some pretty unique ways of raising money and you have to admit me so j Saint Jude has done a very good job of doing that and I have had some of my builders and designers that have participated in those homes. So Beautiful way to help and also raise money for a great cause. So if you have questions, you can call us 615-737 9986-615-737-9986 taking your calls. Obviously talking about my favorite subject, but I do understand 6-8 or June 8th was when we had to file. Last Monday was when if you did not already file an extension, that was when we had the federal disaster extension expire And um I’ve had some really unique um situations because my tax software does not take into account that Tennessee ended up with an extension. 34:19 So some people that actually owed money, it calculated a penalty. The IRS is now sending letters back to them saying you have a refund. And they’re all sitting there going, wait, I owed money. How can I have a refund? And that was because I did not override and make sure that the penalty had gone away. So now all these people are getting small checks back and the the irritation part is is that the IRS is saying you need to update your bank account because we don’t have your banking and therefore we can’t give you a check back um or direct deposit back. And it’s kind of funny because they had the banking account when we paid it electronically through the same website for the withdrawal of the funds. But um I understand the IRS is working very hard to try to get uh uh the fraud out of the system and I can only imagine what they have to deal with. Since we’ve all heard stories on the smaller level, if you were the US government, I can only imagine how many people are trying to break in. So uh they are doing a lot of identity proving I’ve had some clients, it seems like every single year they have to call the government to prove their identity. And they’re not like some really big, you know, crazy things. This is just a normal situation. 35:32 Um, I have one client that has they were told, well, you should get an IPIN and she has had IPIN for a number of years. So it was funny that the government told her that she should get an IPIN because she has had one Um, and yet, you know, they’re they’re always trying to prove or improve their system. So I guess we just have to be patient when it comes to dealing with that because we really do want them to have hopefully the right people doing the right things and not messing up or taking our identities and doing crazy things. All right, we’re going to get ready to take our last break here. 36:03 This is the Doctor Friday Show. If you have a question, you can go to the email friday at drfriday.com Because I know calling a radio station can be a little intimidating. Not everybody’s comfortable calling radio shows. Um, but if you want to join, you can 615 737-9986. And if you’d never heard me before, um, you can also check us out on the web at drfriday.com. That’s our website, drfriday.com. We’re gonna take this break and we’ll be back 36:31 In a few minutes with the Dr. Friday show talking about taxes as an enrolled agent. That’s all I do. So we’ll be right back. 36:39 Alrighty, we are back here live in studio. Last few bits of the show. If you want to join, you can, 615-737-9986. From any of you that may have been listening to me for the last 15 plus years My name is Dr. Friday Burke. I’m an enrolled agent licensed by the Internal Revenue Service to do taxes and representation. Been doing it here in town for about 33 years. in the Brentwood area. I’ve been able to meet and talk to a lot of you, which has been awesome. And I will be continuing to do that. Don’t think that the practice is going anywhere. It is not It’s just that we’re going to try to take our radio onto the internet, new, um, do a couple new and unique things after a while. You gotta freshen things up a little bit. and be able to really target a lot more of the new uh ways of communicating within everybody. Now everyone texts and emails and you know Half the time I have my employees in here and I’m like, have you called the client? And they’re like, oh no, I text them. Well, you know, sometimes people just like you to pick up the phone and call them. I that’s my opinion. Now maybe that’s not everybody’s opinion But I do like to pick up the phone sometimes. It’s a lot easier and you can resolve things so much faster than going back and forth in text. But that’s not the way a lot of the the future um communications are gonna go. 37:58 And so being able to really just uh c hone in on the topics um there’s so many new things going on a lot of changes that’s going to be coming down we all know that taxes we’ve seen the market there’s going to be new tax laws there’s going to be some changes again Um, I’ve had a number of clients that were uh back in 2020, 2021, 22, they were in business. The businesses have now closed due to a lot of hardships that’s been happening And then we’re having to deal with EIDL loans that uh or SBA loans that were given back then that have not been paid off. So there’s a lot of learning curves, always something new and I don’t want to say exciting because not to everybody is it exciting, but for to me, I’m always able to continue to keep learning. And that’s what I’ve always loved about doing accounting and taxes. If you’re a small business owner and you’re needing to have someone that’s going to help you, you know, strategize. What is it that you really need to be doing? What’s the important parts of the accounting not only to be set up to basically do the basic accounting, but also the taxes and what’s the important things to be tracking. I still have a number of clients that uh seem shocked when I ask them for their mileage logs. 39:13 And yes, mileage IQ is one of my number one I suggest to all real estate agents, anyone that’s doing any kind of major traveling. If your business requires. Again, businesses are changing a lot because I have a lot of people that work from home do not have any miles that they have to track. They basically have a home office and in some cases they’re living in very small studios or even one-bedroom homes. So it’s uh again, an office does require to have some sort of walls You know, it can’t be your front room, can’t be your bedroom, can’t be your kids’ room. You know, I mean just because you have a computer and you can sit on the bed with it is not make it an office The tax law is very specific about what is an office space and it needs to be used solely for the purpose of doing office work, not someplace with your dining room table or your inn table or whatever Um so again, um it’s just one of those situations where things are changing and people are not required or having to have the workspace that you know many of us probably still have. I know I do. I enjoy my multiple monitors. It makes my life easier. 40:25 And I couldn’t do that if it was my kitchen table. Now I have seen some pretty cool adapters that can go on laptops. But all I’m saying is is if you want to understand how you can save taxes, establish a better system for you to be able to track those expenses. And yeah, part of it is you need to be tracking the expenses, not only just saying, hey, I went and done this, but where’s the receipt? If you went to Facebook to buy your office computer or your office Uh furniture, you need to have a receipt for that. You need to have proof that you physically paid for it. The IRS would love to probably take everybody’s word, but it’s not going to happen. Never has, never will You need documentation showing that you either went to a garage sale, that you went to, you know, marketplace, whatever it is, and you purchased it. You need uh, you know, taken a picture of the ad Take a picture of the receipt that you took out for the ATM if that’s when you had to go take and give them cash. Um, because again, most of the time people are paying with cash. They’re not paying with uh credit cards or anything that you can easily track. A credit card statement still is not a receipt. Um many times the IRS has come down saying, you know, you taking your monthly um credit card statement and highlighting this was office supplies, this was, and even though it says Walmart, it may say office supplies. 41:50 this was, you know, uh supplies for the business, whatever, but the receipt is what they want to see. Because the receipt’s gonna show that you didn’t go and buy a paper towel for your house or or food uh even though you put on the receipt office supplies, the IRS wants to be able to verify that. And when you’re doing your accounting, you want to be able to just have those. Nowadays you can take a screenshot of it You can save it. You can start a folder for each year or every month, whatever, and put that together so you’re able to really track being audit-proof. is one of the biggest things we’re going to really start honing down on. The IRS has come out that they’re going to be doing more audits. There’s also You know, the fresh start program for people that cannot pay the IRS and being able to make sure that you understand how that works. I have had more than one person that has put their own um fresh start together or 433 OICA and um you know it doesn’t go through and they don’t understand why because You know, I mean again, uh, one gentleman I was talking to, well, you know, he’s planning to inherit, so he wanted to settle with the IRS before he received the inheritance. is if the IRS isn’t going to know that there’s an I mean one of the questions on the questionnaire is are you going to be inheriting or are you a beneficiary on a state? 43:15 Um, you know, I had a gentleman that settled with the IRS and won the lottery like three months later. Guess what? They came back and said um you know you can afford to pay so they made him pay um things are not always as simple as just saying I can’t afford to pay You have money in your house. That’s the biggest thing. People are like, I don’t want to have to take another mortgage out. I I don’t want to have to take the money out of my house. The IRS has very few people that they’ve allowed to keep their homes without having to do anything. And normally it has to do with age or disabilities, and they’re not able to pay pay them back But you need to understand what the IRS expectation is. They have a very specific type of law. And if you understand what the game is, then you might be able to understand how to make yourself somewhat audit-proof Doesn’t mean you couldn’t be audited, just means that when you go in there, you’re going to be able to give them everything they want, and therefore they’ll have nothing to do but take your paperwork and say, okay, thank you Thank you for showing up. I’ve had that once or twice. Um, I will say most of the time when I get involved in audits, it’s already somebody that’s already started the audit sometimes. Um the they didn’t understand what kind of paperwork they needed to be keeping. 44:32 Therefore, when the IRS is audio asking for mileage logs or documentation showing proof of purchases They didn’t have all of them because again, they didn’t really understand what they were. So it, you know, comes down to really understanding what the IRS is expecting. Then you can go around and do what you need on the rest of it, right? Because if you know what the expectation is, you can often deal with what has to be done on other elements. But if you don’t have that expectation, if you don’t understand what the uh total expectation is, then you’re not going to be able to do anything more with it. I mean If you’re tracking everything the right way, then you can sleep easily at night. You know that it’s going to go versus I had someone say, well, how does the IRS know this? Or how does the IRS know that Well, to be honest, you got to work with the idea, what can you justify? What is going to make you sleep better at night? What is the true tax law? That’s the question Alright, guys, this is the last about minute and a half of the show. Again, this will be the last Dr. Friday show for uh Um for now. I don’t expect to come back on, but I do have a lot of friends on the radio, so hopefully I’ll be invited to be on some of their shows. You can always catch us at drfriday. 45:47 com. We’re gonna be starting some pretty cool um and interesting topics that we’ll be having in there. If you have questions, please still feel free to go to friday at drfriday.com or call me at 615 367-0819. That’s my direct number. 615-367-0819 is the phone number. You can always reach us or you can email Friday at drfriday.com again Friday at drfriday.com the website is drfriday.com it’s what we enjoy doing is helping you guys figure out what’s the the best way? How could I keep more money in my pocket? How can I set up a business and then have it running properly? Not kind of getting love letters from Tennessee Department of Revenue or the IRS because things weren’t filed properly There are ways you can just set it up. It is not that complicated once you understand what the expectations are. So again, I am Dr. Friday, an enrolled agent, licensed by the Internal Revenue Service to do taxes and representation. I’m here in town and have been for the last 33 years. If you need help with taxes, accounting, IRS issues, state of Tennessee issues. It’s what we’ve been dealing with for all these years, and we’d be more than glad to talk to you and help you do whatever it is to keep your business running safely. 47:08 Cop ya later.
