About the Guest(s):

• Kerrie Beene: Certified Financial Planner at Rooted Planning Group.
• Kate Welker: Certified Financial Planner at Rooted Planning Group.

Episode Summary:

In this episode, certified financial planners Kerrie Beene and Kate Welker from Rooted Planning Group dive into the details of the 1040 tax return form. They discuss each line item and explain what it means for taxpayers. From reporting income to deductions and credits, Kerrie and Kate provide valuable insights into how the tax return can tell a story about an individual's financial situation. They also touch on topics such as capital gains, itemized deductions, and the standard deduction. Whether you're a tax expert or just starting to understand your tax return, this episode offers helpful information and tips for optimizing your tax situation.

Key Takeaways:

• The total amount from Form W-2, Box 1 represents taxable wages and includes deductions such as retirement plan contributions and health insurance premiums.
• Interest and dividends are reported on lines 2 and 3 of the 1040 tax return and can come from various sources such as bank accounts, savings bonds, and investments.
• Lines 4, 5, and 6 cover retirement income, including distributions from IRAs, pensions, and annuities. It's important to understand the tax implications of these distributions and consider withholding taxes if necessary.
• Line 7 deals with capital gains and losses, which occur when selling assets such as stocks or mutual funds. Long-term capital gains are taxed at a lower rate than ordinary income.
• Line 8 includes other income from Schedule 1, which can encompass various sources such as business income, unemployment benefits, alimony, and gambling winnings.
• The decision to take the standard deduction or itemize deductions depends on individual circumstances. The standard deduction is often the more beneficial option for many taxpayers.
• The qualified business income deduction can provide tax benefits for business owners, allowing them to deduct a portion of their income.

Notable Quotes:

• "Your tax return tells a story. It can provide valuable insights into your financial situation and help you make informed decisions for the future." - Kerrie Beene
• "Understanding the different tax rates and how they apply to your income can help you optimize your tax situation and potentially save money." - Kate Welker

Resources:

• Rooted Planning Group: Website

Don't miss this informative episode where Kerrie Beene and Kate Welker break down the 1040 tax form and provide valuable insights into optimizing your tax situation. Listen now for expert advice and tips on understanding your tax return. Stay tuned for more enlightening content from Rooted Planning Group.