Let's Talk Money

August 16th, 2025. 

Episode Transcript

Speaker 1 (00:00):
Hi, you are listening to Let's Talk Money, brought to
you by Bouchet Financial Group.

Speaker 2 (00:05):
This is Vincenzo Testa.

Speaker 1 (00:06):
I'm one of the wealth advisors here at the firm
and I'm giving a well deserved break to Stephen Bouchet.
I'm a CPA and a CFP, and i specialize in
tax planning and financial planning. So for any of those
unknown task questions, feel free to call in. The phone
number is eight hundred Talk WGY. That's eight hundred eight
two five five nine four nine. We love questions, so

(00:30):
always feel free to call in. And I'm joined by
my trusted colleague Catherine Buck.

Speaker 3 (00:36):
Good morning, Vinnie, it's nice to be here. I'm Katie Buck.
I'm an associate wealth advisor with the firm and I'm
also a certified financial planner and I'm happy to be here.

Speaker 1 (00:47):
Katie's a big part of the team. You know, we
have nineteen professionals and we are adding much more.

Speaker 2 (00:53):
We're growing at.

Speaker 1 (00:55):
A pretty rapid rate and everyone that works at the
firm is very important role. So thanks for joining, Katie.

Speaker 4 (01:03):
Thank you.

Speaker 1 (01:05):
So I'll start the show by giving kind of a
market recap the two major indices, so the S and
P five hundred and the Nasdaq obviously two major indices
that most people follow if you're following the equity markets
at all. So the SMPS up nine point nine percent
year to date, basically ten percent. Pretty solid year from
that standpoint. I mean we're in August about eight and

(01:25):
a half months into the year. This week it's up
about one percent, so a pretty solid week for the SMP.
Markets are doing well. And then as far as the
NASDAK goes, the Nasdaq is up twelve point one five
percent year to date, a bit higher, about two percent
higher than the SMP. The NASDAK is really technology based.

(01:46):
The SMP is a lot of technology companies in it,
but specifically the S and P five hundred is the
five hundred largest US companies by market cap or by
net worth market capitalization. So the NASDAK differs from that
as it is one hundred companies and it really follows
the tech markets. Uh you know those big magnificent seven

(02:07):
tech companies, Tesla, Apple, Amazon, they're all within the NAZAK.
They're also in the s and P, but the NAZAC
really follows the technology markets a little bit closer and.

Speaker 2 (02:19):
Kind of microscopes down on that more than the S
and P. And this week the.

Speaker 1 (02:24):
Nasac's up point seven to six percent, so decent week
for both two of the major indices. You know, people
are comfortable right now, but we'll see what happens.

Speaker 2 (02:34):
No one has a crystal ball, but we can see,
you know.

Speaker 1 (02:38):
Week after week, how things could change. And you know,
we're pretty optimistic as a firm. We're pretty bullish as
a firm. The investment committee led by Ryan Bouche and
Paalo La Pietra and Ed will Helm and Casey Bird,
and you know, they're looking at things very closely. They're
watching what's going on in the economy and just waiting
to see there's any changes we can make in the portfolio.

(02:59):
You know, we make changes about four to five times
a year based on what's going on in the economy
or if we see anything on the forefront that is
worth mentioning or worth noting. We're definitely watching everything very closely.
And one of the things we're watching closely is a
CPI report that that's released monthly. So in June CPI
was two point seven percent, up about point three percent

(03:22):
from the two point four percent in May. That was
released and you know, a lot of the increase. I mean,
it's a small increase from a percentage point standpoint, but
you know, we do know there are tariffs and you
know that could have a large effect on CPI, right,
you know, can start increasing inflation. You know, if there's
tariffs on goods you know, coming in and coming out

(03:44):
of the country, that can you know, affect consumer directly.
So that could be part of what we're seeing here
with this slight increase in CPI from May to June.
You know, the number is relatively low. You know, if
we can remember a couple of years back, we were
in the ten percent range in a couple of the months.
So you know, glad to be back down to these

(04:06):
smaller numbers. You know, we're all consumers at the end
of the day, so the lower that inflation is, you know,
the more that we're going to benefit. The last jobs
report and so in July jobs the jobs report came
out and it was an increase of only seventy three thousand, right,
and that was really below you know, many major economists expectations.

(04:29):
So it's definitely something we're monitoring there.

Speaker 2 (04:31):
Right.

Speaker 1 (04:32):
The employment rate came out at four point two percent,
which was also a slight increase from the month of June.
You know, not really huge warning signs, but something that
we should definitely be monitoring moving forward, and all of
us as consumers and you know, parts of this economy
we have in the United States, right, these are things
that we need to watch very closely. And if things

(04:54):
start to decline, obviously that's an issue, right, Recessions you know,
and when it comes to recessions are always going to happen, right,
the US economy in particular, it goes through cycles, right, peak, trough, recession.
So these are the type of things that could potentially
signal recessionary environment, but it's not guaranteed, right, you know,

(05:18):
it's on a month a month basis. Something that everyone
needs to monitor and just kind of look out for.
And you know, when we're managing your portfolios, these are
the things that we're looking at. We need to watch
these reports closely and make sure that we're being proactive
rather than reactive, right. And you know, another thing that
we do at the firm that we really take, you know,

(05:39):
extremely serious, is cybersecurity. So cybersecurity, I mean, there's a
lot of fraud going on you know, a lot of times,
especially in finance, you know, there's going to be folks
that are going to be trying to fraudulently take your
money from you, right, So we manage client money and
sometimes that, but we're you know, ninety nine point nine

(06:02):
percent of the time, we catch it and we're on.

Speaker 2 (06:04):
Top of it.

Speaker 1 (06:04):
And Charles schwab or Custodian also plays a major part
in help, you know, helping catch these fraudsters. So Katie,
why don't you go into a little bit about some
of the fraud trends that Charles schwab or Custodian has
been reporting.

Speaker 3 (06:20):
Yeah, absolutely, thanks Finny. And before I do that, I
will say for those listening, you'll have a sneak insight
peek into what we're planning for next month. But our
firm will be hosting a cybersecurity webinar. John mulay, our
chief operating officer and chief financial officer, and David Clark,
our director of operations and chief compliance officer, will be

(06:41):
doing that. And we have one from last year if
you're interested, still very relevant today. But we're definitely, as
Benny said, we're monitoring, keeping up updated on everything that's
been going on. So I'd say attending will just give
you further insights and how to protect yourself.

Speaker 5 (06:57):
You know.

Speaker 3 (06:58):
That being said, I'll review some things here today. So
we've been seeing some new fraud trends as reported by
Charles Schwab. You know, we use Charles Schwab as our custodian.
We have no legitimate affiliation with them other that they
are a great partner for us and we love working
with them. You know, fraudster's methods continue to evolve, and
it's important we stay diligent and updated on their new

(07:20):
methods to protect ourselves. Specifically, scammers are now actually appearing
at victim's physical addresses. Reported by the FTC, Fraudsters are
arranging in person meetings at people's homes to collect physical cash, gold,
or other valuables. You know, this is a very big danger.
This could not only you know, result in being scammed

(07:43):
and some of your goods taken from you, but you
can also be in danger of physical harm. So you know,
how is this happening. It starts with a phone call,
an email or social media message where fraudster claims to
be a legitimate governmental or business worker and they use
false concerns and false identities just to get in that door.

(08:05):
And as always they're applying pressure with urgent requests for money.
Who is a target anyone, but more specifically, older adults
are typically the targets of these scams. Now let's pause
and think. I don't want to be an alarmist, but
let's think of ways that we can protect ourselves from
these types of scams in person. If someone visits your home,

(08:27):
first of all, if you do not know who they
are and they're being quite urgent with their requests, don't
let them inside your home. Any genuine government official or
other legitimate representative rarely will visit your home without prior notice,
and always ask for official ID and contact the organization
that they're claiming to be representing through an independent phone

(08:48):
number or different type of contact that you can find,
probably online. So do not pay or provide any personal information,
even if they're pressuring you to act urgently, And if
you are genuine concerned, lock the doors and call the police.

Speaker 2 (09:03):
Yeah, thanks, Katie.

Speaker 1 (09:04):
I mean, these are things that you know, it's kind
of insane to think about how complicated and how complex
some of these scams have been getting. But yeah, I mean,
it's kind of scary to think about when you think
about people showing up to your home trying to scam you.
A lot of stuff going on online, and you know,
these are things that we need to monitor and make

(09:26):
sure that we're protecting your money. You know, if you
are a client, as our clients, you know it's you know,
part of our responsibility to ensure your assets are safeguarded,
and you know we want to make sure and help
you kind of prevent any fraudulent action happening. We're going
to take a quick commercial break. You're listening to Let's
Talk Money brought to you by Bouchet Financial Group. Will

(09:47):
we help our clients prioritize their health we manage their
wealth for life.

Speaker 2 (09:51):
Thank you, Hi.

Speaker 1 (09:52):
You're listening to Let's Talk Money brought to you by
Bouchet Financial Group, where we help our clients prioritize their
health while we manage their wealth for life. This has
Bevincenzo Testa, one of the wealth advisors here at the firm,
CPA and a CFP, giving a well deserved break. Stephen Bouchet,
the one and only, and I'm joined by my colleague
Katie Buck. The phone numbers are the line is opened.

(10:13):
The phone number to call in is eight hundred talk WGY.
That's eight hundred eight two five five nine four nine.
Please feel free to call in with any questions about
anything we're talking about or anything unrelated personal finance related,
tax related. We're here to answer your questions. So a
large part of what we do with the firm that

(10:34):
I think differentiates us from a lot of other firms
in the area and you know, country wide, is you know,
we we take a very direct initiative with tax planning
when it comes to our clients. Right, So, I'm a CPA.
Prior to coming to the firm, I worked at KPMG,
which is a Big four accounting firm, where I was
strictly a tax accountant, and I moved over. You know,

(10:56):
I'm from Troy. Steve Bouchet from Troy, you know, through
some mutual connections, I came on over. Steve wanted to
kind of, you know, start a tax initiative for clients
at the firm when it came to planning and the
tax practice. And then you know, our late colleague Nicole Goebel,
who we love very much, also moved over from Mercer

(11:19):
down in New Jersey and we kind of came together
and started this tax initiative. And now we also had,
you know, our colleague Scott Strohecker joined us who was
a EA and a CFP, so we kind of had
this tax initiative at the firm where we're doing really
in depth planning for clients. And Katie is also a
huge part of that, very knowledgeable, and you know, we're

(11:40):
moving forward helping clients, you know, day after day with
this tax playing initiative. So you know, this is a
large part of what we do. Taxes are the number
one outflow that you'll have as an expense in your life.
You know, the odds are right, So if we can
minimize your tax liability, you know, we're doing you a
big favorite, right. You know, we invest clients money as

(12:02):
we manage clients money. Yes, we want to make our
clients money in the markets. But if we could do
that and then also save you money on tax planning,
it's invaluable.

Speaker 2 (12:11):
Right. So back in.

Speaker 1 (12:13):
Twenty seventeen, during Trump's first term, there was a legislation
pass called the Tax Cuts and Jobs Act, which was
sort of similar to some of the tax cuts that
Ronald Reagan's administration made back in the eighties. So basically
rates were lowered and a lot more cash flow was given.
As far as you know, middle class folks were you know,

(12:36):
had their tax bills lower. The tax rates were lowered,
but there was a couple of things within that bill
that kind of also increased tax liability for middle class
people as well, depending on where you live and what
your situation is. So on July fourth, another legislation was passed,
and it was sort of to kind of continue on
the Tax Cuts and Jobs Act and also make some

(12:59):
adjust where the tax law was currently sitting. And those
of you who know in twenty seventeen, with the Tax
Cuts and JOBSAC was passed, there was a cap right
before that you had the salt deduction. Right, it's the
state and local income tax deduction. This is if you
itemize your reductions. And I don't want to get too
technical for some of the layman's out there, but basically,

(13:21):
your real estate taxes and your state income taxes that
you paid, you were able to have an unlimited amount
of deduction on your tax and your individual tax return
if you itemize your deductions.

Speaker 2 (13:33):
Right, there's the standard deduction which.

Speaker 1 (13:35):
Every taxpayer in the country gets right, and then you
have your itemized deductions, right, which is a combination of
your state and local income taxes, charitable contributions, mortgage interests,
medical expenses, all of these things mixed together. So if
your itemized deductions exceed the standard deduction, it benefits you.
So in twenty seventeen, the salt cap was enacted where

(13:56):
they basically said, if you have real estate taxes and
you have state or state income tax that you pay,
you can't deduct more than ten thousand.

Speaker 2 (14:07):
You're cat at ten thousand.

Speaker 1 (14:09):
So if you think about that, I mean, if you
live you know folks that live in rents of their county,
right you live in Troy, the real estate taxes are
pretty high. I mean, if you if you own a four,
four or five hundred thousand dollars house in Troy, your
real estate tax could be ten, fifteen, twenty thousand, depending
on where you are. And then you have your income tax,
so potentially you can have twenty five to thirty thousand

(14:30):
dollars in real estate taxes and state income tax and
the tax cuts and JOBSAC said, no, you can only
deduct ten thousand, so you're losing out. You were losing
out on twenty thirty thousand dollars in deductions potentially depending
on where you live. Think about the people down in
like Westchester or New York City, those numbers are big, right,
I mean, and some of those folks are upper middle

(14:50):
class and you know, high class, so they could be affected,
you know, very stringently on how much they're able to
duct for state and local income taxes. So with the
one big beautiful bill that was signed on July fourth,
they increased that cap, so I went from ten thousand
dollars to forty thousand dollars. So obviously this could be

(15:16):
potentially a cash flow generator for a lot of taxpayers,
especially in New York, especially in Connecticut. You know, these
these states that have these high real estate taxes. You know,
it really affected some folks because I remember I was
just starting out. I just graduated from Siena. But I
had done tax returns as an intern in twenty sixteen.

(15:36):
I and I had done taxes in twenty seventeen when
the Tax Cuts and Jobs Act was passed, and a
lot of folks, a lot of middle class folks. Even
though the Tax Cuts and Jobs Acts and its name
was to cut you know, give tax cuts. This salt
cap really affected the tax bill of a lot of

(15:56):
middle class folks that probably were expecting to have a
lower tax bill. But it's this particular salt cap of
ten thousand dollars that folks are finding themselves with higher
tax bills because they were losing out on that deduction.
So it's really crucial. So the increase on this cap,
you know, for folks that are listening, if you have
high real estate taxes, if you're still working and still

(16:17):
pay pretty extensive state income tax, near city income tax,
this is going to be really beneficial for you guys,
and you're going to see it next year when you
file your tax turn that you know, your your tax
liability is going to be a lot lower. So One
Big Beautiful Bill also continued on the lower rates. So
the Tax Cuts and Jobs Act that was signed back

(16:39):
in twenty seventeen was set to expire after twenty twenty five.
So One Big Beautiful Bill said, hey, that's not expiring anymore.
These lower rates that we have, and the marginal tax
rates start at ten percent and go up to thirty
seven percent, so those rates are going to stay where

(16:59):
they're at right and Obviously, it depends on where your
income is based on where you're going to end up
in those marginmall brackets, right. And you know, there's a
common misconception when it comes to tax brackets. If you're
in the twenty four percent tax bracket, some folks might think, oh, well,
I make one hundred thousand dollars a year, my tax

(17:21):
bill is going to be twenty four thousand dollars. In
the federal side, it's not the case. So each bracket,
a certain portion of your income gets taxed in that bracket.
So everyone starts in the ten percent bracket, a certain
amount of income gets taxed ten percent. Then you go
up to the twelve percent, a certain amount of income
gets taxed at twelve, twenty two, and so on and

(17:41):
so forth. So if you're in the twenty four to
thirty two percent bracket, not all of your income is
getting taxed at that, right. But when we do planning,
we want to kind of make sure we're managing that, right,
So if you're in the twenty four percent bracket, we're
going to you know, if we're doing roth conversions or
kind of accelerating income and doing tax planning, these are

(18:02):
the things you monitor, we don't want to put you
up in the thirty two percent bracket because all of
your income's getting tax at eight percent higher. So when
we do planning, you know, we're looking at that very closely.
But these lower rates are here to stay. And you know,
obviously if you look in years past, you know we
have lower rates than usual right over the past fifty
to one hundred years, right, So we're in a lower

(18:24):
rate environment as far as tax rates go, and you know,
it definitely could be a good time to do some
proactive planning.

Speaker 2 (18:31):
That's what we do for our clients. And you know,
if you are.

Speaker 1 (18:34):
Going to recognize income and accelerate it, now would be
the time to do so. And just want to kind
of touch on some other updates from the One Big
Beautiful Bill. We have the child tax credit, right, so
if you have a child and your under certain income limits,
the child tax credit is two thousand dollars per child, right,

(18:57):
And the credit is partially refundable, and a refundable tax
credit means that even if you don't owe any tax,
you could still receive money back as a refund from
the tax credit. Some tax credits are non refundable, so
Let's say you know, after everything is set all your deductions.
Let's say you have you know, the salt capped, the

(19:19):
state local income tax reduction, and your itemized deductions and
your taxable income can down to zero, you could potentially
still get a refund from the child tax credit. So
the child tax Credit has increased from twenty to twenty
two hundred. It's a small increase, but you know something
worth mentioning if you have three, four or five kids,

(19:40):
this is something that could really be a huge benefit
for you, and it always has been a benefit, but
just that extra two hundred dollars per child is put
some more money in the pocket of the US consumer.
On the flip side, there is another deduction that has
been enacted called the senior deduction.

Speaker 2 (19:58):
So for those of you who have.

Speaker 1 (19:59):
Watched the new over the past couple months, you know
there's been talked about no tax and social Security reduction
of tax and social security. So taxpayers with this new
senior deduction, taxpayers ages sixty five and up can claim
a deduction of six thousand dollars individually and twelve thousand

(20:19):
for married couples.

Speaker 2 (20:21):
So what this is.

Speaker 1 (20:22):
Really doing, it's aiming to reduce and eliminate Social Security tax.
You know, a lot of with a deduction of six
thousand dollars, a lot of folks might have Social Security
income on an annualized basis of thirty five thousand, forty thousand.
It's kind of not even really denting the Social Security

(20:42):
tax for specific individuals, but it's a help, right, And look,
it could potentially lower your adjustice gross income, could lower
your Medicare premiums.

Speaker 2 (20:51):
And if you're married, you know.

Speaker 1 (20:52):
You get double double that deduction, so it could be
potentially beneficial. And it does phase out for high earners,
so if you go over a certain income threshold, you
could potentially lose that deduction. And this specific deduction expires
after you're twenty twenty eight, so similar to the task
cuts in Jobs Act, there's an expiration date, right, which

(21:14):
was twenty twenty six, And this could potentially get continued
on down the road, but I guess we'll see what
they do with legislation.

Speaker 2 (21:24):
Moving forward.

Speaker 1 (21:26):
And Katie, you know, Katie's a big part of the
tax team, is very knowledgeable. I'm going to let her
touch on some other items in the one big beautiful
bill that I think can apply to most.

Speaker 2 (21:37):
Of you listening out there.

Speaker 3 (21:39):
Yeah, thanks Fanny. And you know, before I go into that,
I will I feel like I should just also admit
that I am part of the marketing team at Bouchet.
So this is really why I'm coming in and plugging
a lot of our webinars and resources. But they're available
they you know, not only clients have access to this,
but anyone who wants to go to Bouche dot com.

(22:00):
We have a one Big Beautiful Bill webinar that you
can review Vinnie and Scott Strohecker and they review everything
and much further detail. And also we have a downloadable
fact sheet, so that's also available to everybody else. You know,
I am going to jump into some of the one

(22:21):
Big Beautiful tax bill information for their depths after our break,
but what I will say is something I want to
clarify is explaining tax on overtime. You know, I have
a sister who is a registered nurse and a future
brother in law who is a police officer, and you know,
I want everyone to be able to really understand what

(22:42):
that might mean for them with tax and overtime. So
we're going to be jumping into a break soon, but
I will just reiterate everyone's welcome to call in at
eight hundred Talk WGY. That's eight hundred eight two five
five nine four nine. You're listening to Let's Talk Money,
brought to you by Bouchet Financial Group, where we help
our clients prioritize their health while we manage their wealth
for life.

Speaker 1 (23:02):
Hi, you were listening to Let's Talk Money, brought to
you by Bouchet Financial Group. This has Vincenzo Testa once again.
I'm one of the wealth advisors here at the firm
CPA and a CFP. We encourage all listeners to call
in at TALKWGY. That's eight hundred eight two five five
nine four nine. Please call in with any questions. We're

(23:25):
here to answer them and rolling on for another half hour,
so it's a sense of urgency here. Before the break,
we were talking about the One Big Beautiful Bill, which
was the new tax legislation that was signed on July
fourth by the President, and we were discussing some of
the new provisions and tax updates that could apply to you.

Speaker 2 (23:45):
Right. A lot of these.

Speaker 1 (23:46):
Provisions are directly applicable to our clients. So you listening
out there and it could be important and when it
comes to tax planning, it's a year round, proactive strategy,
not a reactive strategy.

Speaker 2 (23:59):
Or shouldn't be.

Speaker 1 (24:01):
So if you know these new provisions, and you know,
you know certain strategies you could take to take advantage
of them, why wouldn't you It could save you money? Right,
Everyone likes to save money. That's why coupons are a thing.
So before the break, Katie Buck was about to jump in,
who's joining me today? One of the other wealth advisors

(24:22):
here at the firm is very knowledgeable on tax law,
and she was going to talk about tax on overtime.

Speaker 3 (24:27):
So go ahead, Katie, Great, Thanks Benny. And before the break,
you know, I was just explaining that I do have,
you know, close family members who you know, having a
break on tax on their overtime pay. You know, that's
just more money in the consumer's pocket. So there are
some things that I want to clarify and cover just
because it sounds wonderful, no tax on overtime, but it's

(24:49):
not entirely all overtime pay. So starting in tax years
twenty twenty five through twenty twenty eight, so this is
really only around for another three to four years. Okay,
Employees can duct overtime compensation that is calculated from the
income rate above an individual's regularly hourly pay. So the
overtime deduction is capped at twenty five thousand dollars married

(25:13):
filing jointly and twelve thousand, five hundred dollars if you're
filing single, and once you get passed those amounts, there's
one hundred dollars reduction for every one thousand dollars over
an income phase out, and that income phase out is
modified aj just gross income of one hundred and fifty
thousand dollars single three hundred thousand dollars married filing jointly.

(25:34):
All right, So I'm going to do an example here.
I feel like a bit of a teacher in this moment,
just to really explain this in better color. So, for example,
we have Lucy who works two hundred and fifty hours
of overtime and twenty twenty five. You know, her hourly
pay is regularly twenty dollars an hour, but she gets

(25:54):
time and a half. So now her overtime pay is
thirty dollars an hour, so she's not going to be
taxed on the difference between those two pays. So thirty
dollars subtracted by twenty dollars an hour, so ten dollars
an hour. So that is where she has no tax
on her overtime pay. So ten dollars an hour by
two hundred and fifty dollars an hour is two thousand,

(26:16):
five hundred dollars that she would not be taxed on.
She's under the phase out MAGI limit and it includes
relevant info and tax information. On her tax return, she
can now deduct that two thy five hundred dollars from
her taxable income. So just wanted to reiterate, she doesn't
get to deduct all of all of her overtime pay.

(26:37):
It's just that difference between a regular pay and what
that overtime pay would be, which is ten dollars an hour.
Something else that I think is really important to review
is explaining tax on tips, something that's probably going to
be affecting a lot of people, especially maybe not you,
but people in your life, and also important to review.
You know, you know, first of all, you have to

(27:00):
report your tip income to the IRS. That is key here.
If you're not doing that and you want to not
be taxed on your tips, you know you have to
report that tip income to the IRS. So starting in
tax years twenty twenty five to twenty twenty eight, again
you can deduct up to twenty five thousand dollars of
tip income per tax years. And you can be an
employee and you can also be self employed, but those

(27:23):
who are self employed are limited to business expenses exceeding
income here, so if you don't have any real business income,
you can't be deducting that tip income. So what are
tips as defined by the IRS. These are cash and
card based payments, so just make sure that that's really
the tip information that you were putting in when you

(27:44):
were filing with the IRS. And additionally, if you are
married filing jointly, you have to be claiming marriting finally jointly.
You can't do married filing separately to receive this no
tax on tips deduction. So it's a one hundred dollar
reduction for every thousand dollars of income above a phase
out limit. So you are limited to forms of modified

(28:08):
adjusted gross income as well, So if you have a
modified adjusted gross income over one hundred and fifty thousand
dollars single and three hundred thousand dollars marie finally jointly
there's going to be a reduction of what you can
deduct from that tip income. And again you can deduct
up to twenty five thousand dollars of tip income for
tax here. And the last thing I wanted to cover

(28:31):
was the new vehicle loan interest deduction. Similarly, and you'll
see a trend here is every single deduction I've reviewed
is only from twenty twenty five to twenty twenty eight.
Some of the things VENU review today, some of them
are permanent, but others are just for a few years.
So this is something that you want to be updated on.

(28:51):
We have that one big beautiful bill webinar slide and
our fact sheet and our webinar just to give you
really all the information you might need moving forward, to
make sure that you understand what you can be deducting
and relying on for years to come or just for
the next few years. So starting text you're twenty twenty
five and twenty twenty eight, you can deduct up to

(29:12):
ten thousand dollars of interest on a new vehicle loan
for personal vehicles only starting loans after December thirty first,
twenty twenty four, So essentially it has to be a
new car loan in twenty twenty five. The car must
be brand new, there can be no prior use or ownership,
and the loans from related parties do not qualify for this. Again,

(29:35):
there's another income phase outlimit. If you're single, it's a
MAGI over one hundred thousand dollars, and if you're married
filing jointly, it's two hundred thousand. And then you're going
to have a reduction over that limit. And specifically that
I'll note the vehicle must be assembled in the US,
and this also excludes least vehicles, which I'm sad to

(29:56):
say that excludes me from taking a new vehicle loan
interest rate deduction for twenty twenty five. But yep, these
are just a few interesting provisions that President Trump noted
while he was running an office. No tax on tips.
I know that this was very you know, interesting and
helpful to a lot of individuals in our country, and

(30:19):
especially explaining tax on overtime. I think we'll just give
a better idea of what these tax provisions actually mean
for the consumer, and hopefully, you know, people are taking
advantage of them. So again, if you need further information,
you can reach out or call in at eight hundred
talk WGY. That's eight hundred eight two five five nine

(30:39):
four nine. We'd love to hear from you.

Speaker 2 (30:42):
Yeah, thanks, Katie.

Speaker 5 (30:43):
Yeah.

Speaker 1 (30:43):
I mean a lot of these provisions in the in
the one big beautiful bill, Like I said, they're applicable
to pretty much anyone listening out there.

Speaker 2 (30:51):
We all have to file a tax return.

Speaker 1 (30:54):
There are provisions that you know, odds are even one, two, three,
four or.

Speaker 2 (31:00):
All of them could affect you, and it's it's definitely
worth noting.

Speaker 1 (31:03):
I mean, we have companies like Regeneron in the area
that I know a lot of the folks that work
at Regeneron or Stewart, so they're all entitled to overtime pay.
So prior to this bill being passed, you were getting
tax on your overtime pay. And you know, depending on
how much overtime you work. You know, there's police officers

(31:23):
out there, there's firefighters. This could affect a lot of folks,
which means a lot more cash flow is going to
be being dumped into the US economy, which could be
a good thing for businesses and economic growth. Right, but
you know, kind of the balancing act that makes it
difficult is, you know, we have a deficit, right, and
is the reduction of taxes on the consumer going to

(31:50):
result in higher tax revenue for the country, right, And
that's kind of this balancing act, and that's why we
have the Democratic Party and the Republican Party and they
have differing views. But you know, on the surface, when
it comes to us as the consumer putting more money
in our pocket, that's a good thing. But we also
want to make sure that the economy and the you know,
federal deficit is being paid down and we're not growing

(32:13):
that deficit year after year. So you know, these are
all great things for us, right, but you know, if
it's affecting the economy negatively, it's kind of difficult to determine. Yeah,
we have more money in our pocket, but you know
what what does it mean down the road?

Speaker 2 (32:27):
Right?

Speaker 1 (32:28):
You know, what about the Social Security UH Trust Fund
that we have right years you know that obviously talks
about potentially, you know, social security could be eliminated, not
in the near term, but you know maybe for folks
like Katie and myself. You know, Katie, you're twenty seven,
I'm thirty one. You know, when it comes time for
us as a collect SoCal security like what's that going

(32:48):
to look like?

Speaker 2 (32:49):
Right?

Speaker 1 (32:49):
These are the type of things that changes have to
be made to make sure that we still have you know,
the benefits of Social Security and that we're paying down
the debt. And you know, it's great in all that
you know, where we don't have tax on overtime and
we don't have tax on tips, right, restaurant workers. You
know how many restaurants are there are there in the
United States where people are waitressing, bartending. You know, they're
getting taxed in their tips. Now you know a large

(33:12):
portion of tip income is being eliminated for tax purposes.

Speaker 2 (33:16):
But what effect does that have on you know, the.

Speaker 1 (33:20):
Deficit and the economy as a whole, right, kind of
have to monitor that. And then as far as the
new auto loan vehicle interest deduction, right, this is something
that has never been an effect as well as the
overtime and you know exemption a federal tax and overtime
and tips, right, And what they're trying to do is
really incentivize folks to buy.

Speaker 2 (33:39):
American made vehicles.

Speaker 1 (33:41):
Right, So you know, if there's a demand for American
made vehicles, you know, if that's increasing, you know, potentially
if there's other tax laws that I'm not going to
get into. You know, a tax law called the Guilty
Act which was enacted at the Tax Cuts and Jobs
Act back to twenty seventeen, which forces you know, US

(34:02):
corporations that have entities outside of the United States to
pay tax, right They're called the Guilty Tax on the
income outside of the United States and forces them to
pay tax on that, which is kind of incentivising them
to bring these manufacturers back to.

Speaker 2 (34:22):
The United States.

Speaker 1 (34:24):
Right, So you know the combination of all these things,
that's kind of like the huge agenda, right. You know
the current administration, you know, they want to bring jobs
back to the US and they're doing and they're doing
that right by enacting some of these tax laws as
you can see. So you know, the auto loan introduction
has to be US made, right, the Guilty Tax which
I was just referring to, all these things hopefully come

(34:44):
together and you know what does that do boosts the
American economy.

Speaker 2 (34:48):
We have one caller, Kathy on the line.

Speaker 1 (34:56):
By good morning, Hi Kathy, how are you.

Speaker 6 (35:00):
Good?

Speaker 7 (35:00):
Good?

Speaker 6 (35:01):
So, I have a question regarding the tax for overtime.
Is the employer not collecting the tax or is this
something that we do on our income tax.

Speaker 1 (35:14):
No, So when you have wages to your company, they're
just withholding taxes, right, And I'm not really sure what
the withholding rate would look like as of right now.
I mean this is brand new, right, But even if
you withheld on those, so you're going to get the
deduction on your tax return. So what happens is you
have all this income when you file your tax return,

(35:35):
you have all these aductions, right, you might have wages,
you might have business income, and you put this all
on your tax turn at the end of the year,
and then you see how much was withheld, how much
estimated payments you made, and you calculate your tax and
subtract out all that withholding, and that's where you get
either a refund or you find out if you owe.

Speaker 2 (35:52):
Right.

Speaker 1 (35:52):
So when your employers withholding taxes, they're not withholding them
for good. They're just making sure that you're paying them
in throughout the year because they're potentially be penalties if
you're underpaid, or they just want to make sure that
you're not hit with a thirty thousand dollars tax bill
when you file your tax return. Right, So you're gonna
want to withhold throughout the year. So I'm not really
sure what it will look like in terms of withholding

(36:13):
in a paycheck year or a bi weekly basis or
you know, semi annual, semi monthly basis like some folks have.
But it's just going to be reconciled on your tax
return when you file it.

Speaker 4 (36:27):
Okay, Well, thank you for the answer, Kathy.

Speaker 2 (36:30):
Where just out of curiosity, where do you work? You
do you receive overtime?

Speaker 7 (36:35):
I do not.

Speaker 4 (36:36):
I'm a paralegal, so I work salary, but my son
in law works with a lot of overtime, so I
was wondering on you know, for him.

Speaker 2 (36:49):
Gotcha, gotcha?

Speaker 1 (36:50):
Yeah, yeah, So you know these are these are all
brand new provisions. You know, we're gonna have to see
what it looks like. But it's definitely going to be
reconciled on your tax return.

Speaker 2 (37:01):
And if you paid in on.

Speaker 1 (37:02):
Overtime through withholding federal tax withholding on your overtime, it's
going to be.

Speaker 2 (37:08):
Not necessarily giving back to you via a refund, but
that's what we should expect. Okay.

Speaker 6 (37:14):
Well, thank you and thank you for your show.

Speaker 4 (37:16):
It's very informative.

Speaker 1 (37:18):
Thank you, Kathy, appreciate that okay, bye bye, no again.
We encourage all listeners to call in at eight hundred
Talk WGY. That's eight hundred eight two five five nine
four nine. So kind of just to end on this note,
we're going to take a quick break. You're listening to
Let's Talk Money brought to you by Bouchet Financier Group,

(37:39):
where we help our clients prioritize their health bow we
manage their wealth for life.

Speaker 5 (37:42):
Thank you.

Speaker 2 (37:43):
Hi.

Speaker 1 (37:43):
You're listening to Let's Talk Money, brought to you by
Bouchet Financier Group, where we help our clients prioritize their
health BO we manage their wealth for life. This is
Vincenzo Tesla, one of the wealth advisors here at the firm.
Please call in with any questions. The phone number is
WG eight hundred Talk WGY. That's eight hundred and eight
two five five nine four nine. We do have another caller,

(38:05):
Tom from Colony. How you doing, Tom?

Speaker 5 (38:10):
Good?

Speaker 2 (38:11):
Good?

Speaker 5 (38:12):
Regarding the I guess it would be an itemized deduction
for interest that you pay a new car. Yes, yep,
so you have to itemize to be able to receive
that betterfit correct, No, you do.

Speaker 1 (38:29):
Not have to itemize, so This is what they refer
to as an above the line deduction, So it's before AGI.
So you can receive this seduction even if you don't itemize,
and there are income you know, phase outs for that
as well. So yeah, even if you're not itemizing. So
if you, yeah, are you looking to buy a car

(38:50):
sometimes in the near future.

Speaker 5 (38:52):
Well, I'm thinking it might be worthwhile.

Speaker 2 (38:55):
Yeah, I mean, you know where interest rates are at
right now.

Speaker 1 (38:58):
So the way we look at a time to get
too technical, right, so you know, let's say the loan,
the auto loan you're going to get is you know,
eight nine percent, right, and you're a hier. I don't
know what your specific situation is, but if you're in
the thirty two percent tax bracket, right, if you look
at it as you know, eight nine percent auto loan interest,
thirty two percent tax bracket, if you get a loan

(39:20):
on a vehicle that's manufactured in the US and you're
titled to that deduction, really your interest rate's only five
or six percent, right, which is still a bit high, right,
if you had the cash to pay it, might you know,
I think it's worth the conversation to kind of see
if it's worth just paying for the car and cash,
but you know, the after tax interest rate with this deduction,

(39:41):
it could be beneficial to you know, if you were
leaning to buying a new car looking at the USADE
vehicles versus a vehicle that wouldn't be eligible for this deduction.

Speaker 5 (39:51):
So they have a list of the vehicles that would qualify.

Speaker 1 (39:55):
I don't think they have a I'm one hundred percent
sure if they have a list, I'm sure that there'd
be a lot of vehicles on that list. But I
think you know that whatever you're brochure each vehicle has
at the dealership, it would kind of indicate and I'm
sure I'm sure car dealerships are on top of it. Right,
if you go to the dealership, they might know what

(40:15):
vehicles are manufactured directly in the United States.

Speaker 2 (40:18):
So just kind of doing that deeper research.

Speaker 5 (40:21):
Right like handas Hondas might be made in the United States.

Speaker 2 (40:24):
Is not a yeah yeah right, so yeah yeah yeah.

Speaker 1 (40:28):
So you think you'd think, right, those are Japanese vehicle,
but you know, some of them are manufacturing in the
United States and some of them they get moved around, right,
you know, partially manufactured in Japan, partially manufactured in the US,
the parts coming from you know, wherever. It's just definitely
worth looking deeper into to see if you're eligible for

(40:49):
that deduction because I could save you a couple of
thousand dollars under taxes.

Speaker 5 (40:53):
So okay, thank you very much.

Speaker 1 (40:58):
Thanks Tom again. Encourage all listeners to call in a
eight hundred talk WGY. That's eight hundred eighty two five
five nine four nine. Before the break, we were discussing
the one big beautiful built tax revisions and tax updates.
You've had a couple of calls about that, and I
know Katie wanted to talk about social security. Katie's really

(41:20):
an expert on social security planning and you know, very
very nolgable on this, so she just wanted to discuss
a couple of facts about social security.

Speaker 2 (41:29):
So I'll let her go ahead.

Speaker 3 (41:31):
Sure, i'd say expert might be a bit generous, but
it is part of our job with planning planning to
to really have that conversation with clients. And you know,
it might be a bit morbid, but we usually say
when we review our financial plans with everybody, you know,
we can tell you exactly want to pull social security

(41:51):
and you if you know exactly when you're going to die,
because it's really based off of, you know, how long
are you going to be receiving the benefit for and
you know, there's a lot of things that we weigh
in this discussion. So I'm just trying to just pull
out first that this is super dependent on everyone's situation
and it's unique to everybody. But I thought that I

(42:12):
would just review some highlights and I went onto the
Social Security website, which I encourage everyone to go to
and create an account, even if you are in the
younger age group like myself or Vinny. You know, this
is a it's a good resource, and getting familiar with
it is definitely it is definitely good. So you know,

(42:33):
you know, where do you begin? You know, where do
you begin to figure out maybe what your benefit looks like?
As I said, go to SSA dot gov. You can
also call their eight hundred hotline, but the way times
might be significantly longer than you would like. So creating
an online accounts typically faster and it's very easy to do.
We have lots of clients who might claim that they're

(42:55):
not technically savvy, they've been able to do it, and
then from there you can get your wage history and
really see what your benefit is starting age sixty two
to age seventy and and updates annually. So highly encourage
everyone to go check that out if I have not.
And then I wanted to just discuss, you know, what
does what is full retirement age? That is actually a

(43:16):
term used when we look at certain types of benefits
for individuals. So full retirement age is different for different people.
For those born in nineteen sixty and later, this is
actually age sixty seven, which really means you're going to
be receiving your full Social Security benefit? So what does

(43:36):
that mean if you pull before that or after full
retirement age? So what happens if you elect prior to
full retirement age? You're really permanently reducing your benefit. And
it's actually up to a maximum of thirty percent reduction
based off of a full retirement age benefit, and also
can be temporarily reduced on top of that thirty percent

(43:57):
reduction if you pull at sixty two, depending on if
you have any income. So there's if you earn over
I think it's going to be a ballpark number here,
ladies and gentlemen, because it is indexed annually around twenty
three thousand dollars. If you earn above that and you
pull your Social Security benefit before full retirement age, you're

(44:18):
going to see a reduction on top of that early reduction.
The year that you enter full retirement age before your birthday,
it actually hits that income limit increases to around fifty
seven fifty five to fifty seven thousand, maybe up even
to sixty now and twenty twenty five. But it's just

(44:38):
something to be aware of. You know, you're going to
be parmonally reducing that benefit if you pull prior to
full retirement age, and also depending on your income, you
might be receiving a temporary reduction as well. But again
that might actually be an answer for some clients and
some people's planning. So it's just something that we want
people to be aware of. Now, on the blip side,

(45:00):
what happens if you elect pass full retirement age. Every
twelve months an individual delays their benefit from full retirement
age increases their benefit by eight percent. You know, that's
an eight percent guarantee that we can't guarantee in the market,
although we've seen some great years in the market. This
is a really good way to maximize that income. So

(45:21):
just wanted to note though once you hit age seventy,
delaying past age seventy, there is no additional benefit. It
does not continue to increase, So at that point you
really should be pulling that Social Security benefit. But as
I said, the best time to pull social Security is
unique to every one situation. So we just wanted to
float some frequently asked questions and provide some further insight.

(45:46):
And this is something that we provide to our clients
during our financial planning process. You know, we're wrapping up
to the end of the show, so I'm just gonna
toss over to Vinnie for some final thoughts.

Speaker 7 (45:57):
Yeah, thanks Katie, appreciate it. Appreciate everyone listens in. It's
a beautiful weekend. Hope everyone has a good time out there.
Sarah took a racetracks open, a favorite place on planet Earth.
You are listening to Let's Talk Money, brought to you
by Bouchet Financial.

Speaker 1 (46:10):
Group, where we help our clients prioritize their health, but
we manage their wealth for life.

Speaker 2 (46:16):
Again, thank you everyone.

Speaker 7 (46:17):
For tuning in, and we will be on tomorrow at
eight a m.

Speaker 2 (46:21):
Thank you