Getting started … with taxes.
In my experience, debt problems almost always accompany debt chaos. Records scattered everywhere, bills not opened, creditor calls not returned, checkbooks not balanced. It seems like it’s an incredible challenge each day just to get up and get to work. The energy that folks have at the end of the day to get started getting a grip on the debt problems is just … not … there.
Debt problems cause frustration and … exhaustion. So nothing happens—things just get older, and staler, more difficult, and more confrontive.
Such chaos, and our avoidance of dealing with it, just leads to a more intractable problem. What to do? Is there any way out?
I have noticed one thing that provides a way to dramatically start moving toward a solution of those major debt problems. It’s getting started just on the TAXES.
This might seem illogical, since taxes are often our most neglected problem. Many folks cannot recall the last year they even filed their taxes. But by concentrating on just this one narrow item—only the taxes and nothing else—whatever energy you can summon can be focused on this single important issue. And you have an ally—your tax preparer.
Believe me, tax preparers (or your bookkeeper or CPA) are well aware of how procrastination leads clients to a sense of hopelessness. They well know about the guilt and shame that can keep folks from coming in to see them. So here’s the tip: Put aside your embarrassment and just call them. Tell them you really need to move forward with the taxes. DON’T WORRY ABOUT HOW MUCH YOU MIGHT OWE! DON’T WORRY ABOUT THE EMBARRASSMENT! JUST GET THE BALL ROLLING! Have them set you an appointment at the earliest available date.
What your tax preparer can do, for a start, is tell you exactly which years have been filed and which years have not. This then defines your task—it it no longer an unknowable black hole. This will then lead you to the next step: finding those W-2 forms. (The good news is that if your W-2’s are missing, your tax preparer can obtain your “Wage Transcript” from the IRS itself!) A good tax preparer can prepare your return within just a few days. When it’s prepared and signed, be sure it’s electronically filed. And be sure to keep a copy, including your W-2’s.
Don’t worry about how much you owe. You may be surprised to receive a refund or two! Even if taxes are owed, the IRS is not hard to work with to set up a payment plan. (Yes, you may have to wait on the phone, but it’s worth a morning to do so. Call right at 8:00 am.)
Once the taxes are off your desk you can turn to other financial issues with renewed energy and focus. There are many books which will help you with your financial planning. It might even be wise to hire an expert to advise you how to proceed.
If you are unsuccessful in obtaining a payment plan, go see a bankruptcy lawyer. Most bankruptcy lawyers do not charge for a first appointment, and they can explain in plain language where you stand. They can tell you the easiest way to handle taxes you can’t pay immediately.
The other huge benefit derived from getting those taxes done is the encouragement to keep the ball rolling to handle your remaining financial issues—whether working out payment plans or perhaps filing a bankruptcy. Once the taxes are off your chest everything gets better—I promise you. You’ll sleep better, you’ll have more energy, life will look better, because you will see that you can in fact make progress with your debts if you take it in stages. Just … keep … moving.
If you find yourself in financial difficulty, whether or not it involves taxes, feel free to call me for a free consultation. I am here to put you on the track to financial freedom.
