Ep. 197 | Unlocking Your 1040 (Tax Planning Tool)
Download MP3Hey everybody. And welcome back to the Teaching Taxable Podcast episode 197. You might notice something a little different here. There is somebody on here with me and, you know, heck, we're gonna call him my cohost today because Chris Picciurro, you know, we'll say he's on vacation. We gave him the day off.
John Tripolsky:We are gonna talk about a topic today. Personally, I'm really excited about. We're gonna talk about that pesky little ten forty, right? If if nobody knows what a ten forty is, well, you've got a little bit of a different issue that you need to learn about that. But that IRS Form ten forty is something you may just sign on once a year, maybe with a check that you used to have to mail.
John Tripolsky:Now you're likely doing that electronically or you feel like you're gonna get a refund. So there's also a problem we're gonna talk about if you're getting a refund, that's also technically another issue. So that should perk your ears. But Bill Park, welcome welcome to the show, man. I'm super excited to talk to you on this one.
John Tripolsky:Frankly, what do you actually do? Let's have you introduce yourself. So what what's your title in your little paradise background you have there, and what are you up to, man? I I wanna hear it from your mouth.
Bill Park:Well, I appreciate that, and thanks for having me on the show, John. That's a really good question. It's funny, my dad's 87 years old and he still asks me that question. What do you do, son? I'm like, well, okay, dad, okay, I gotta explain it to you, that's crazy.
Bill Park:Well essentially I've literally had one job my entire life. I mean I'm not talking about going through high school and stuff but a real job. And so I'm just an entrepreneur, I'm just out there building stuff, creating things, I have a couple of companies, I've got a bookkeeping, accounting, financial services business, I got a real estate company, I got a software development company, I do some private angel investing and also founder of Tax Hacker And so that's where I spend most of my time right now, and I just enjoy building, creating, and and just engaging life.
John Tripolsky:I love it. And honestly, that's probably one of the shortest definitions I've ever heard an entrepreneur say. Because usually, it's like, how many things can I go through? And, you know, ten minutes later, they start talking about what they're up to and what they're what they're moving forward with. But so, obviously, you mentioned tax hacker.
John Tripolsky:So that that's why we're here. Tax hacker. Like, what is this thing? And and frankly, that's why we're talking about this topic. Right?
John Tripolsky:So you guys have developed a tool, and I'll I'll let you talk a little bit about that. And then, obviously, the ten four use a whole we're gonna dive into. But I think the greatest thing about this is, right, is you didn't go to college, become a developer, and say, hey. You know what? I'm just gonna create a bunch of fun stuff and go after all these industries and and kinda take the the the normal approach.
John Tripolsky:I think what a lot of people take, you know, they learn a skill and then they build something around that. You've gone, I guess we can call it grassroots for the for the most part. Right? Like, you sat in the seat of the people you've developed something for. Is that probably the best way to describe it?
Bill Park:It's spot on. I mean, I I definitely have a I don't know. Maybe it's a it's a sickness of some sort. I don't know.
John Tripolsky:You're an entrepreneur. Yep. We all get the same disease, buddy.
Bill Park:We're good. Can't leave things alone. Right? And so if I if I see a way to to strip away, I think Elon Musk says this, get rid of the dumb stuff, which I love that he said that. So get rid of the dumb stuff.
Bill Park:So I try to do that. And that kinda led me into software is trying to figure out to automate and have people focus on their higher value skill level stuff. So that's kinda that's kinda how how it come about. And as an entrepreneur, nobody has nobody has exactly the the solution for what you're working on. You know what I'm saying?
Bill Park:The tools that even if you're trying to create something, you you you still have to build your own stuff. So and and I really like to do that.
John Tripolsky:And with this, I mean, I remember the first time that me, you, and Chris actually talked, and you were telling us about the the platform you guys have. And it it almost hit me then, or it it might have been the second time we talked a while back, is, you know, when people go into business for themselves, in in this case scenario, you know, we're really just talking about business owners for the for the time being. But everybody's very intrigued and very excited and, you know, they have this aura, I guess you can say around them about, oh, I'm doing my own thing. I'm going to have all this freedom. I'm going to follow my passion.
John Tripolsky:They're all excited, but then I don't think anybody actually tells them like, hey, you can actually, in your situation, most of the time, you have so much control over your tax situation. You know, I think sometimes people are more afraid like, oh crap, I'm gonna have to pay, you know, SE, a self employment tax, and all this other stuff. And and then they all of a sudden think that a deduction is a 100% discount, which is not the case. You know, that's a whole another conversation. But what you guys have, basically, your take you've developed this where where somebody is taking their ten forty, which really, in a sense, is their IRS report card.
John Tripolsky:I guess, you can call it that or some other form. They're putting it into something, and it's starting to expose or or elevate or bring to the surface opportunities they have. So I think it's funny, right? And anybody who's listened to this might laugh. You know, here you are talking about taxes or listening to it, and neither myself or or you, Bill, are tax professionals, which is fantastic.
John Tripolsky:I don't know how they do it. But let's talk about, you know, why everybody's here. Why they're probably here thinking, well, what in the world does a ten forty have to do with tax planning? Or what how can I use that as a basis for something or a kickoff point? So maybe walk us through that and kind of inadvertently, right, it's gonna tell us about how y'all's platform works because that's what it does.
John Tripolsky:Right?
Bill Park:No. Absolutely. Yeah. No. You're spot on.
Bill Park:You know, I I look at a ten forty as as sort of like the rearview mirror. So when you're looking in your car in the rear, you see in the back, that's what the ten forty does. And but you're driving, you're looking through your windshield. And I think there's a big issue there. And I I did this for years in starting a business.
Bill Park:Like, I was always reactive. I wasn't looking forward in terms of my, you know, my taxable opportunities or reducing my tax. I just thought it was just the way you do things. You hire a CPA, you go through, you hustle, you make money, they put it into this form and then you have to write a quarterly check. Right?
Bill Park:I mean, that's just seems to be the way to do it. But then the more and more I did that, I'm like, this just doesn't feel right. I mean, I I have no way to solve anything and I feel like I'm in the same cycle like Groundhog Day. Right? But and then but if I compare it to like blood work, right?
Bill Park:So blood work is a you get a composite, right? They're gonna take blood from you, they're gonna build this whole composite and why do they do that? Well they do that because they're trying to understand baseline, kind of what you said about understanding a baseline and then they're going to see, okay what's acute, what can be treated right now, you know, what's forward looking in order that we're going to solve some problem that's dealing with your blood work or some some symptom that you're having. Well that ten forty is sort of that tool and but it's a mysterious tool. It's like you look at it and you're like how do I even read this thing?
Bill Park:And then there's all these these schedules and what does all that mean? I'm like somebody needs to demystify this and I hate to beat up, you know, professionals, EAs and CPAs and anybody that's doing compliance or filing, you know, that's a tough job. There's a lot to do there, right? However, there is just, it's not as mysterious as people think it is. So my, you know, I wanted to solve that.
Bill Park:I wanted to solve that for everyday people that they could have a solution to upload their ten forty, demystify it in natural language and say, hey guess what, it looks like you may have overpaid a little, you can fix that, here's how you can do that. Hey you might want to look into these things, right? Because the ten forty isn't the whole picture, it's just like I said, when you look in the rearview mirror how big is that view? It's small, right? But when you look in the windshield how big is that view?
Bill Park:Right? So we're taking that rear view perspective and saying how can we fix something today and in the future? So that was my idea is how do we demystify that, make it easy and light for anybody to look at, read, and understand?
John Tripolsky:I love that example of blood work. I don't think I've ever heard that one, and it's almost like you the you the person person, the patient going in for blood work is kind of the ten forty. Right? Like, you're you're there and you know, they're going to tell you some things and it's up to you at, you know, the the taxpayer at the end of the day though whether or not you want to do anything. If, you know, if you're sitting there eating a candy bar in the parking lot every morning for something, I mean, it's up to you if you wanna stop it.
John Tripolsky:Right? Sure. Like, in y'all's case, you know, you you guys are looking at the 10:40. You're demystifying it. I love that word.
John Tripolsky:And you're breaking it down into something that's digestible. You know, it's understandable is another thing, and then it's it's outlining things. Right? And I think you you mentioned to or alluded to it in in some regard is you could there's some stuff that I wouldn't say anybody can understand, but a lot of people can. And then, obviously, there's a whole gamut of other things.
John Tripolsky:Right? Like, which ones play nice together if implemented at the same time, which ones are more beneficial, what's shorter, what's longer term game. But what we're talking about here is that taking that ten forty I wish I had a piece of paper here. Just hold up. Being like, this little guy here that is a static document at this point.
John Tripolsky:Right? Once it's done, print it off, air quotes. What can you do with it? Like you said, some people just move it along like yourself. You just do it every year and and you get it out of the way.
John Tripolsky:But using it as a planning tool, that little bastard should be up on the wall, frankly. Like, you should be looking at that thing because that it that's your your printed off map off, you know, MapQuest twenty years ago. Right? Like, keep referring to this thing, and it's gonna it's gonna guide you where you wanna go. So I I love I love that you guys have taken that approach, and and let's talk a little bit more about about your your how you got into this.
John Tripolsky:Right? So, like, you've had some experience as a business owner where, you know, we talked a little bit prior even to hitting record here. You've kind of felt like you had to go through that that gamut. At what point did you realize, like, you know what? I I really need to do something about this.
John Tripolsky:Was it just somebody said something to you? Was it a podcast you listened to? What what was the the trigger moment? I'm just curious.
Bill Park:Well, this is gonna go back. I mean, this this is probably gonna go back two decades, but I felt felt like every tax season was Groundhog Day and we're talking about the same things. Although the topics would change slightly, but I felt surprised all the time and I just, I thought to myself, know, I'm trusting this tax professional to do their best job and I'm not saying they weren't doing their best job, but I felt like well they just didn't couldn't put the time and effort in to really prepare and plan properly and really educate me on things where that you know kind of like that don't eat candy bars right, change your diet this way, do these three things right. There was really none of that, it was always very compliance oriented. I said I just got, I just need to understand that.
Bill Park:So what I started to do is I said to my CPA, I said I need you to go through and show me every line and explain it to me in detail every year. And I said it's your obligation to explain to me why I'm paying what I'm paying. And that was eye opening for me, right? And anyway, so as that was my journey, frustration, overpaid for many many years. Today, it's a different story.
Bill Park:Today is a completely different story. I sold a business in 2024. I paid zero capital gains tax.
John Tripolsky:And that's not something you could do if you just tried to figure that out after it was sold.
Bill Park:Well, I don't even think a CPA would have done that for me. In some cases, not to say that they can't. I'm not beating up on the CPAs, apologize out there. But I I talked to business owners that have sold their companies too. Guess what?
Bill Park:They're paying capital gains tax. They didn't have to. So I think it's really, really important for people to I think who was it? There's this great quote and it was by Leonard Hand. He was a chief justice.
Bill Park:This goes back in the thirties. And he said this, and I'm I'm I think I'm screwing it up here and you might wanna fact check it exactly, but it is you have it's your inalienable right to pay as little taxes as possible. It's your obligation in life. So it was an interest it was very interesting quote. So anyways, I I take that personally.
Bill Park:So I wanna help I wanna help everybody in that cause to pay as little as possible. In some cases, euro.
John Tripolsky:It's a great approach. And and this is how I've explained this to people. Right? Like, again, me not being a tax professional. I've learned through osmosis, through through Chris and everybody else too.
John Tripolsky:It's if it wasn't, if it wasn't thought about, we'll say, you know, by the IRS and congress and all this stuff to make itself into the guidebook. You know, this is the IRS publication, thousands of pages. The toughest part about it and again, my opinion from from learning about this is the toughest thing is knowing what's in it and knowing what's not in it. If it's not in it, you can take advantage of that. If it's something that's in it, you can also take advantage of that.
John Tripolsky:So, it's been thought about. It's been put in there. They've probably thought about it a heck of a lot more than the taxpayer has. So it's finding somebody that works with you to accomplish what you wanna do. Right?
John Tripolsky:If there were if they didn't want somebody to pay $0 in tax or, you know, a thousand dollars in tax, I feel that they would put that in there somehow, be like, you have a minimum tax payment due of x. Like, there there's all these guardrails in there that as long as we play within them, I mean, you're not poking the bear for lack of better terms. You're just doing what's there. Right? But people don't know about it.
Bill Park:Poke the bear. I mean, you should poke the bear. I mean, that that's my thing. I mean, at the end of the day, it's it's you know, your documentation is gonna rule the game is is gonna rule that match. You know.
Bill Park:The record itself of the ten forty document isn't underlying you know, a truth and source, it's your documentation. I think there's the other problem right, is people don't understand that level of documentation. But real quick side note of how ignorance my ignorance was, I had I have six kids.
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Bill Park:Alright. Business owner. Now a business owner with six kids, there's a huge financial opportunity there. I knew nothing about it when my kids were growing up and I had a pretty sizable company then. Like the amount of money I could have legally expense for my company and given down to my kids to set them up if, you know, in a tax free environment would have been huge for me.
Bill Park:I knew nothing about it. That that's the kind of stuff that I wanna close that gap.
John Tripolsky:Mhmm. And I love that there's tools out there, like what we're talking about, what you guys have worked on, that it it's it's a it's a DIY, call it a step one. Right? Like, somebody can get in, and they're they're being exposed in in a credible way. Right?
John Tripolsky:It's now like you've caught fifteen seconds of a forty five minute, you know, conversation on TikTok, and now all of a sudden, you're running out looking for a vehicle that weighs 6,001 pounds, and it's gonna change your world because it's taken out of context. Right? Like, when something is positioned in front of somebody at their own, say, own will, their own timeline, say it's 02:00 in the morning or say it's a, you know, in a lunch break while they're walking. I always feel that for me, it's always so much better the outcome because then the pressure is not really on them of having to make a decision at that moment. They're in, like, sponge mode.
John Tripolsky:Right? They're in education mode, and everything's laid out in front of them, and then they can take those next So whether it's reaching out to their tax professional or or just leaning on somebody else or researching something specifically that they don't know a lot about, it's the ball's in their court. Where I think some some individuals I mean, I I would feel this way is, say they only met with a tax professional once a year. Say there's that tax deadline that's, you know, lingering up, in April, and, you know, it's April 1 or May 25 or something, and they finally get in with a meeting with their tax pro. And everybody seems kinda rushed.
John Tripolsky:They might prepare a little bit, but they're only preparing what they know they can get. There's not a lot of opportunity conversation there. Right? So while we're always talking about tax planning as a whole, it's that windshield and rearview mirror and that continual flow of conversation where, you know, I think if people's mind shift I know I'm kinda going on on a whim here a little bit, but if people change their mindset a little bit and they're looking at that document, that ten forty, you know, however many pages theirs is, but and holding onto it and not throwing it away or storing it away until next year. Like, keep that puppy around because that is something like the report card.
John Tripolsky:Right? The report card to a kid is telling you how good or how bad you did, or report card to a parent is telling them where they have opportunities to improve, which I think is very similar to a ten forty, if that makes sense.
Bill Park:No. Absolutely makes sense. I mean, it it is a there's a reconciliation. Right? So and that is that, you know, that is super important.
Bill Park:You know, you you said something about about this idea of, you know, once a year meetings and stuff like that and having that forward facing look. It's it's a tough it's a tough business, you know, filing tax returns, being compliant, and running a business in that regard, it's it's a lot of work. And if you think about it, you know, they have a real obligation to get that that return filed, right? That's their main objective, is to get that return filed. And they're counting on the individual to give them the information to file, okay?
Bill Park:That's the job,
John Tripolsky:okay? And
Bill Park:90% of the time that's exactly what you're getting. And we just need to flip that a little bit. We need people, individuals like you and I, personal responsibility with our own finances and our own course of action and our ability to feel we have control over it. And I think that's another gap. People don't feel they have control.
Bill Park:And they do, they have a 100% control. If especially if you're a business owner, taxes. Now if you're a w two employee, that's the first thing you pay. Right? But even then you have some opportunities to determine how much is withheld.
John Tripolsky:So it's a fun game.
Bill Park:Yeah. Exactly.
John Tripolsky:Unless you lose, then it's not a fun game.
Bill Park:I love the game.
John Tripolsky:But, oh, this this is awesome, Bill. I and, you know, we could talk on this, I think, for for a long time and go off into a lot of different alleys or or aisleways, which is great. So we're we're gonna have to do this. We're gonna have to have you back on. I know we're we got some stuff on the books.
John Tripolsky:We're actually be in person together so everybody can, you know, be on the lookout for some little clips. I know we're gonna pop out of that, but, honestly, Bill, this was great, man. And and if you're okay with it, I'm gonna I'm gonna put a link in our show notes too if anybody wants to check out tax hacker. That was a tool that you guys created.
Bill Park:Yeah. That'll be great.
John Tripolsky:Check it out. I mean, it's it's a great tool, and I'm not just saying that because Bill's on here with me. If it if it wasn't any good, I would tell him. So Yeah. As you guys know, I don't ever feel that.
John Tripolsky:So I appreciate it so much, man. We'll, we'll see you soon and have you back on if, if I didn't scare
Bill Park:you off. Alright.
John Tripolsky:Absolutely. Absolutely. And anybody who's listening to this, be sure to subscribe to the YouTube channel if you're watching it, if you're listening to it, and you're not a YouTube person, maybe consider getting on YouTube there and be sure to subscribe. Hit the little bell too. You get the notifications every time a new podcast episode is released.
John Tripolsky:Weekly, we do them here, and we are creeping up. So we are almost to that 200 mark, which that means that we've been doing this for two hundred weeks. Man, do I feel old? That's a lot of tax anyways, we're not gonna go down that that avenue, but check it out. And also go to defeatingtaxes.com.
John Tripolsky:It's kind of the fork in the road, if you will. It can get you multiple places, multiple resources we have here at Teaching Tax Flow. So as always, we'll see everybody back here again next week on the Teaching Tax Flow podcast. Have a great week, The
Disclosure:information in this podcast is educational and general in nature. It reflects the opinions of teaching tax flow and does not take into consideration the viewer's personal circumstances. It is not intended to be a substitute for individualized financial, legal, or tax advice. Consult the appropriate qualified professional prior to making any decisions. Securities are offered and supervised through Cabin Securities Inc member, FINRA SIPC.
Disclosure:Investment advisory services are offered and supervised through Cabin Advisors LLC, an SEC registered investment advisor. Chris Picciurro is a registered representative of Cabin Securities and an investment advisor representative with Cabin Advisors LLC. Teaching Tax Flow is an independent entity and is not affiliated with Cabin Securities or Cabin Advisors.
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