What matters most to you when selecting a financial advisor?
Someone who shares your biblical values? How about someone who will take the time to explain your financial options clearly? Certified kingdom advisors meet high standards of competence, integrity, and biblical training, equipping them to offer financial advice grounded in God's Word. No more wondering if your advisor truly understands what's important to you. Find a certified kingdom advisor near you at findaceka.com.
That's findacaka.com. The holidays are behind us, and you know what that means? It's tax season. But do you know who your tax preparer will be? Hi, I'm Rob West.
It's gone largely unnoticed, but there's a nationwide shortage of CPAs and accounting talent in general. Waiting to line up your tax preparer could cause problems, but I'll tell you how to avoid them. And then it's on to your calls at 800-525-7000. This is Faith in Finance, biblical wisdom for your financial decisions. Uh So, first of all, when you hire someone to do your taxes, the odds are that person will either be a CPA, a certified public accountant, or an enrolled agent.
Both are qualified to prepare and file taxes for other people, although the CPA requirements are much stricter than those of an enrolled agent.
Some attorneys also specialize in tax law. The problem is that there is a shortage of CPAs, and enrolled agents are also in high demand. In particular, not enough young people are choosing those fields. One of the major big four firms, KPMG, continues to offer high school students internships at $22 an hour to entice them into becoming CPAs.
Now, this may become not only an inconvenience to a lot of people this tax season, but a real danger. If folks become desperate to find tax professionals to file their returns, it opens the door to unscrupulous tax preparers who may even be falsifying. Their credentials. The IRS suggests a number of ways to protect yourself from these fraudsters who come out of the woodwork every tax season to perpetrate refund fraud, identity theft, and other scams. Look for a preparer who's available year-round.
If you're audited, you certainly want your tax preparer available to represent you.
So, obviously, you want to avoid fly-by-night operations. When interviewing a tax preparer, ask for their IRS Preparer Tax Identification Number or PTIN. Paid tax return preparers are required to register with the IRS, obtain a PTIN, and enter it on any returns they prepare. You can check whether a tax preparer has done this by going to IRS.gov and looking them up in the Directory of Federal Tax Return Preparers. This tool can also help you locate a preparer in your area with the qualifications you're seeking.
You should also ask if the preparer has a professional credential, such as a CPA or enrolled agent. Ask about continuing education classes they've taken. Tax laws are complex and change frequently. Preparers have to stay up to date on tax topics. You can also check on the history of a tax preparer.
For CPAs, check with the State Board of Accountancy. For enrolled agents, go to irs.gov and search for verify enrolled agent status. For attorneys, check with their state bar association. Then you also want to ask about fees. Avoid preparers who base their fees on a percentage of their clients' refund, or if they brag their refunds are bigger than the competition.
Do not give any personal information or documents to a preparer unless you've checked them out and are satisfied that they're legitimate. All a fraudster needs is your social security number to file a fraudulent return and steal your refund. You also may want to make sure the preparer offers IRS e-file and then asks to have your return filed that way. If the preparer can't or won't file electronically, that's a warning sign. Paid preparers who do taxes for more than 10 clients generally must file electronically.
It's also the safest and most accurate way to file.
Next, watch out for a tax preparer who doesn't ask you for records and receipts. Legitimate preparers need those documents and will always ask you for them, so be prepared. Here's another warning sign: if a preparer says they can e-file your return based simply on a pay stub, head for the door. They're required to use a W-2 and you'll need to provide it. You also need to understand the rules of representation.
If you're audited, CPAs, enrolled agents, and attorneys all can represent you before the IRS in any situation. Non-credentialed preparers, including your cousin Bill, who's a whiz with numbers, cannot represent you if you're audited. The next one goes without saying, but let's say it anyway. Never sign a blank check or an incomplete return. Review the entire tax return and make sure it's complete before signing.
Ask questions if something's not clear or looks inaccurate. Also, any refund should go directly to you, not into your preparer's bank account. To make sure, check the routing and bank account number on the completed return.
Now, one way you can avoid any potential problem with your tax preparer is to look for a CPA, enrolled agent, or tax attorney with the Certified Kingdom Advisor designation. Just go to findacka.com. That's findac. We'll be right back. What we do is very special and it's very unique.
This is Bethany. She is a Certified Kingdom Advisor. I became a CKA because we're not building bigger barns and we're not trying to figure out how can we just amass more and more and more. We're figuring out how much do you really need? What are your priorities?
What has God called you to? And then how can we give it away? How can we be more generous? You can find an advisor like Bethany at findaceka.com. Children across Malawi, Uganda, and Zambia are suffering, but you can help break the cycle of poverty for these kids, their families, and entire communities.
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I'm so glad you're with us today on Faith and Finance. We do have a few lines open. If you have a question today, call right now, 800-525-7000. I've got an amazing team ready to take your call, and we'll get you on the air quickly. Let's head to Madisonville, Kentucky.
Kathy, go ahead. Hi, I just got a question about long-term care insurance. Does that cover assisted living? Yes, it does fall under long-term care because it provides ongoing help with activities of daily living, which is really the litmus test for long-term care policies.
So, you know, these are things like bathing, dressing, medication management, meals supervision.
So, if the services are expected to last longer than 90 days, now that is not the same as a nursing home, and the difference matters a lot for payment. But at the end of the day, yes, assisted living does fall under a long-term care insurance policy. Was there a specific question, though, related to that, or is that helpful? Yeah, I just want to know if it covers that.
So like if you had to be an assistant living like say five years, it would cover that? It depends on the limitations of the policy. Do you already have a policy in force, long-term care insurance? No, I don't have anything yet. I was just trying to understand how it all worked.
Okay. Yeah. So it really depends on the limitations of the policy. But yes, long-term care insurance often does cover assisted living. You know, ultimately, you know, a triggering effect for a long-term care insurance policy would be two or more of the activities of daily living.
And then you have an elimination period.
So that would be a waiting period.
So that might be 60 or 90 days. And then, beyond that, the policy has a benefit period.
So, it might be: okay, you've got an elimination period for the first 90 days, you'd have to cover out of pocket. And then the benefit period might be three years. Again, this would all be different based on the policy you get. And the longer the benefit period and the shorter the elimination period, the more expensive the policy is going to be. But let's say it had a three-year benefit period.
Then, at the end of three years, the policy would stop paying out. And then, in your example, if you were there five years, you know, you would have to come out of pocket at that point, if that makes sense.
Okay. Yeah, I just didn't know what it covered. I was just trying to get out of the idea of how it works. Yeah, absolutely. Was there any follow-up questions to that?
I was just telling you how expensive is a is a long-term care. policy. I mean what lowest to highest? I mean, how much do they do on average? Yeah.
So what is your age? Fifty-six.
Okay. Yeah. So this is a good time to be looking at it between 55 and 65. You know, if you have modest inflation protection, you know, typically these policies are going to be somewhere around, you know, $1,500 to $4,000 a year for someone age 55. Again, it's depending upon the benefit package.
So what is that elimination period, the waiting period? What is the benefit period? How long does it pay out? And then what is your health status? A lot of that's going to have to do with ultimately what you pay.
But that $1,500 to $3,000 would be a reasonably sized policy with some modest inflation protection, where it's paying out a reasonable, what they call daily benefit amount, which would be somewhere covering typical care that somebody needs for most of. services whether it's in-home care or nursing care.
Okay. Thank you.
Okay, sure. Thanks for your call today. Lord bless you. Let's go to Ohio. Charlie, go ahead.
Hi, thank you for taking my question. I'm wondering I'm forty five years old and I'm looking to buy a house, and I would need to get a thirty year loan.
So I'm wondering if that's a wise investment for the future when I'm older. I think retirement age is like sixty seven.
So I'm not sure what to do. Yeah, it's a good question. You know, more and more retirees are entering that season of life with a mortgage still in place. I mean, if you can be at a point where, you know, by the time you're entering retirement, your home is owned, free, and clear, that would be great because that would take that largest, what's most for most people, their largest expense off the table, which just makes it a little easier to balance the budget. If that's not possible, then you know, you may have to carry it into that retirement season of life for a period of time.
So if you're planning to transition to what God has for you next at, let's say, 65, and maybe that doesn't involve paid work, you know, you would have 20 years to do that.
Now, when you go to price out a 20-year mortgage, you may say, well, this is more than I can afford reasonably. And typically, the rule of thumb we look at there is no more than 25 to 30 percent of your take-home pay so that you've got enough left for everything else. But if that's not possible, then yeah, I think it's reasonable to say I'm going to take out a new 30. Year loan. Maybe you pay it like it's a 20-year loan, and they could tell you how much extra you need to pay a month to pay it off in 20 years.
But the nice thing would be: if you ever had to, you could drop down to that lower 30-year required monthly payment. And if you had to extend that payback 10 years into retirement, well, then that's just what you do. Or at that point, maybe you sell it, pay off the loan, and downsize. Perhaps that's another option. But I wouldn't say at 45 getting a 30-year loan is something you just need to avoid altogether.
I would just say do everything you can to try to prepay that, even if it's sending just one extra payment a year, if possible, out of surplus, so that you accelerate that payoff, if that makes sense. Yes, that makes sense. Thank you so much.
Okay. All right. I appreciate your call today. Thanks for being on the program. Let's go to Naperville.
Hi, Ruth. Go ahead. Hi, Rob. Thank you so much for taking my call. Yes, ma'am.
My question for you is that I am doing a remodel. My husband has Parkinson's, and what started the remodel is I needed to do the bathroom to accommodate him better. And this particular, just the bathroom, is going to be about 25 to 30,000. My question to you is Is it better to take out of the bucket two, which would be my 401, or would it be better to take out of the bucket of my home, which is paid off and has been for about seven years? Yeah.
Or is there a bucket three option, which is take it out of your home in the form of a home equity loan that you pay back? And you still own the home free and clear once it's paid off. I mean, the benefit of the reverse mortgage is you'd never have a payment unless you wanted to.
So it gives you the flexibility to not pay it back and just let it grow with interest and fees, or to pay it back and get back into a place where you own your home free and clear. It's just a more expensive option. Because the fees are higher. I mean, right up front, you've got the 2% fee to the FHA to make sure that you never owe more than the house is worth. And then you've got fees on top of that annually plus the interest that's accruing.
So, probably the least expensive way would be to do it just with a straight home equity loan, but it would require you have enough cash flow, Ruth, to be able to cash flow the payments on this thing to ultimately pay it back. Is that a position you're in, or would that be a problem?
Well, we have my husband's retirement and then both of our social, and then I'm working. I would like to stop working.
So then that would put us down a little bit. I think, you know, we could. make payments. I mean, that's not an issue. Yeah.
Okay. But you would rather go with that.
Well, you know, if you feel like you're going to be squeezed on it, that's where the reverse mortgage could be a blessing to you. Because again, you could take it as a line of credit, meaning you don't have to take what you don't need. There'd be a little higher fees, but you'd have the choice: do we make a payment on it or do we not? And if you don't, you're able to do the renovations you want and enjoy them and accommodate your husband and his health needs. And still have plenty of money to cover your living expenses.
I mean, that's where a reverse mortgage I think really shines, and you don't have to continue to pull money out.
So I'd check with our friends at MovementMortgage, movement.com/slash faith. Stay in the light. I'll make sure you have the information during the break, and we'll be right back. Stay with us. Are you a financial professional looking to grow your practice while offering advice that aligns with your Christian values?
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Great to have you with us today on Faith and Finance. We've got room for you.
So, if there's something going on in your financial life, we'd love to hear from you today so we can chat about it. The number to call is 800-525-7000. Again, that's 800-525-7,000. You'll get right through at the moment. We've got our team standing by and any financial question today, again, 800-525-7,000.
Let's go to Florida Mini. How can I help? Hi.
So my question is, um, so my husband has retired.
So We still file joint income. But he is when he wants to claim anything, Like disability, they will tell him that he can't because of my income.
So my question is, should be be filing joint? Or not. Yeah, great question. And the bottom line is: you know, filing taxes. Married filing separately, many usually does not help a spouse qualify for most government benefits.
Typically, government programs look at household income, not how taxes are filed.
So, you know, the tax filing status is an IRS concept, basically, whereas disability and public benefit programs use their own rules.
So, the filing status would not change your household income, and therefore, the counting rules would not get any better.
Now, disability programs, I will say there is a big distinction there in the sense that, you know, if you're talking SSDI, that's not income-based. That's based on your work history and disability.
So, a spousal income would not matter, and therefore, the filing status would not matter either. If it's something like SSI, supplemental security income, that's both income and asset-based.
So, your spousal income is going to be counted. Automatically. And then most government programs follow household income rules as well.
So I would say, at the end of the day, you're probably not going to find any change with regard to what he qualifies for if you were to change that tax filing status. Does that make sense? Yes, so okay, so even if we're separate The household income will automatically include me. That's exactly right. Yep.
Okay. Unfortunately, I wish I had better news, but I appreciate your call today. Call anytime if you have other questions. Let's finish out the broadcast today. Illinois, Mary, go ahead.
So I'm actually calling on behalf of my mom. My dad passed a couple of years ago, and we are going to or she is actually going to receive a sizable settlement, maybe around three hundred thousand. And so she just got a ton of questions about what to do with it. I know she wants to possibly put something aside for the grandchildren. But by her receiving that amount of money, How is that going to affect her?
And her um insurance and her taxes. Um yeah, we just need some. Yeah, well, I think these are all the right questions to ask. And I think the big idea is to really be thoughtful. You know, step one is really to pause just like you're doing before making any big financial move.
So I would say don't rush, put it in a safe, liquid account first, so a high-yield savings or money market. Give herself time, 60 to 90 days, to make a plan. And she's going to want to avoid pressure from family. I'm not saying you're pressuring her, but anybody who might, you know, or can't miss investments. It's amazing when you have a large lump sum come your way, how people come out of the woodwork with ideas on what you should do with it.
Second is handle the taxes.
Now, often settlements are not taxable, but they may be.
So non-taxable examples would be like, you know, personal injury or medical expense compensation, if though it's lost wages or interest. Or punitive damages that may, in fact, be taxable.
So she's going to want to talk with a CPA or tax professional. And if there are taxes due, hopefully there aren't, she'll want to set those aside before any spending or gifting. And then, third, I think she's going to want to look at her own financial condition. Does she have an emergency fund? Does she have any high-interest debt?
Is she retired or nearing retirement? What about medical expenses or long-term care?
So, she'll want to think through that. In terms of money for the grandkids, if she's willing to earmarket for college, a 529 plan could be a great option where the amount she puts in could be invested. It would grow tax-free. She keeps control over it, and she can even change the beneficiaries if one of the children didn't need the cost of college covered.
So, she has that control over the account, and it could set them up really well to be able to fund the cost of education down the road. And then, if she just wanted to make some outright cash gifts, she could do that as well, and that would not be taxable.
So, I think the idea behind really stopping, praying, thinking. Thinking through her plan would be key. And the last thing I might say is: you know, connecting with a certified kingdom advisor in her area could be another great option. The website is findaca.com. These are men and women who understand biblical financial wisdom.
They've met high standards and training and character and competence and pastor and client references. And she could find one there in Illinois that is a good fit to come alongside her and help her put a more robust financial plan in place and make some of these decisions. But is that helpful, though, at all, Mary? Oh, very helpful. But what was that website again?
Yes, ma'am. It's findacka.com. CKA stands for Certified Kingdom Advisor.
So findaca.com.
Okay. Certified Kingdom Ex Wonderful, wonderful.
Now, could her receiving this lump sum of money affect like her Medicare, her health care coverage because now her income has changed. Like out of pocket horse. Sure. Uh what did you say her age was? She is 83.
Okay, yeah.
So she is currently on Medicare.
So, in terms of this settlement, it doesn't affect Medicare eligibility. It could affect something called IRMA, which is the income-related monthly adjustment amount.
So, you know, it could add an extra surcharge to both her Medicare Part B and Part D. premium And that looks at your modified adjusted gross income from two years prior.
So if she got the settlement in 2026. it would affect her Medicare premiums in 2028.
So it is something to be aware of and plan for. It's not going to affect her right away, but she doesn't want to be caught by surprise down the road. I hope that helps, Mary. Thanks for your call today. We appreciate you being on the program.
Well, folks, thanks for being along with us today.
So thankful for your comments, your kind remarks about the program. You know, it's my high calling and privilege to be able to come alongside you each day and tell you you can do this. You can be that wise and faithful steward that you want to if you're thoughtful about it, if you lean into God's word, if you heed the counsel of scripture and not the consensus of this world. And we want to help to encourage you to that end. Big thanks to my team today.
Brent, Adam, Jim, Taylor, and everybody here at Faith By. We'll see you next time. Faith in Finance is provided by FaithFi and listeners like you.
