Armstrong & Getty On Demand: "My Favorite Day of the Year!" – Detailed Summary

Episode Release Date: April 23, 2025
Host: Armstrong & Getty
Guest: Stephen Moskowitz, Founder and Tax Attorney at Moskowitz LLP

Introduction

In the "My Favorite Day of the Year!" episode of Armstrong & Getty On Demand, hosts Armstrong and Getty delve deep into the often daunting subject of taxes with their esteemed guest, Stephen Moskowitz. As a seasoned tax attorney and founder of Moskowitz LLP, Stephen brings clarity, expertise, and a touch of enthusiasm to what many consider a dry topic. This episode is a treasure trove for listeners seeking to demystify the complexities of tax laws and maximize their financial benefits.

Meet the Guest: Stephen Moskowitz

Stephen Moskowitz is not just any tax attorney; he is a passionate advocate for leveraging tax laws to one's advantage. With years of experience representing a diverse clientele, Stephen has become a trusted name in the realm of personal and business taxes. His approach combines deep legal knowledge with practical advice, making tax strategies accessible to all.

Favorite Day of the Year: April 13th

At the beginning of the discussion, Stephen shares his favorite day of the year: April 13th, as mentioned at [02:51]. While this might seem unconventional given the typical association of mid-April with tax season stress, Stephen reveals the personal significance tied to this date, setting the stage for a candid conversation about taxes.

Timely Tax Return Filing Tips

One of the primary topics Stephen addresses is the importance of timely tax return filing. He emphasizes the pitfalls of procrastination, advising listeners not to emulate the frantic, last-minute rush often depicted in movies ([03:09], [04:00]). Instead, he recommends:

• Filing for an Extension: While filing an extension grants more time to submit tax returns, it's crucial to understand that it does not extend the time to pay any owed taxes ([03:09]).
• Payment Plans: If unable to pay the full tax amount, Stephen advises filing the return regardless and paying what one can, subsequently setting up a monthly payment plan with the IRS.

"If you're reasonable with them, they’ll be reasonable with you. You can work something out. You don’t have to be afraid of it." ([04:50])

Demystifying the IRS

Contrary to popular belief and Hollywood portrayals, Stephen reassures listeners that the IRS is not the monstrous entity often depicted. He explains that the majority of IRS employees are merely performing their duties, and with honest communication, taxpayers can navigate their obligations without undue stress.

"The IRS is portrayed as monsters. They're not; most of them are just doing their job." ([04:10])

Maximizing Tax Benefits for Everyone

A standout moment in the episode is Stephen's emphasis that tax benefits are not exclusive to the wealthy. He outlines various deductions and incentives available to individuals across the income spectrum:

• Homeowners: Deductions on mortgage interest and real estate taxes.
• Business Owners: Depreciation on machinery and buildings, accelerated deductions, and pension contributions.
• General Benefits: Tax deductions for setting up pensions, retirement plans, and more.

"The tax law has something for everybody in it. It’s worth it. Knowing it, studying or going to somebody who does, there’s just so much there." ([06:32])

The Ever-Expanding Tax Code

Stephen delves into the historical growth of the tax code, highlighting its complexity and the challenges it presents:

"When you argue tax law, it’s one of the things you don't realize about tax law, but that’s part of the beauty of it, or at least the way the system works." ([06:54])

He compares the current tax law to a vast tapestry, continuously woven with new interpretations, amendments, and judicial decisions, making it both a fascinating and intricate field.

Home Office Deductions: Benefits and Drawbacks

With the rise of remote work, many listeners are curious about home office deductions. Stephen provides nuanced insights:

• Eligibility: To deduct a home office, the space must be used exclusively for business purposes. Even a single-room studio apartment can qualify if appropriately designated ([11:41]).

• Potential Downsides: Deducting part of one's home for business purposes can convert that portion from a principal residence to business property, affecting tax benefits upon the property's sale. This can introduce complexities like depreciation recapture ([11:41]).

"It’s like medicine. This is a good medicine, but there's a side effect which may or may not affect you." ([12:32])

Strategic Pension Planning

One of the most enlightening segments revolves around pension plans and their strategic tax benefits:

• Deferred Deductions: Contributions to pension plans can often be deducted not only in the current tax year but also when filing for an extension, allowing for significant tax shields ([15:52]).

• Multiple Plans: For high earners or those with substantial incomes in a given year, setting up multiple pension plans can exponentially increase deductible amounts, effectively reducing taxable income ([15:52]).

"You set up pension plans, and by the way, you can have multiple pension plans in the same year, you set up multiple pension plans, and then you make multiple plan your contributions in one calendar year, you get a gigantic deduction against that fantastic year." ([14:37])

Importance of Professional Guidance

Throughout the conversation, Stephen underscores the value of professional tax advice:

• Avoiding Self-Cheating: Many individuals inadvertently cheat themselves by not fully utilizing eligible deductions and benefits.
• Complexity Handling: Given the intricate nature of tax laws, professional guidance can uncover hidden opportunities for substantial savings.
• Long-Term Benefits: Investing in a tax professional can result in significant financial gains, often outweighing the costs.

"Most people cheat on their taxes. They cheat themselves by not taking advantage of everything they're entitled to." ([15:52])

Notable Quotes

• "A positive cash flow with a tax loss, isn't it the most beautiful words in the English language." – Stephen Moskowitz ([05:32])

• "You set up pension plans...you make multiple plan contributions in one calendar year, you get a gigantic deduction against that fantastic year." – Stephen Moskowitz ([14:37])

• "Knowing it, studying or going to somebody who does, there's just so much there, and yet so many people treat it with despair. And it's horrible. You have to take a look at all the good things that they're there." – Stephen Moskowitz ([06:32])

Key Takeaways

1. Proactive Filing: Don't delay tax filings. Utilize extensions appropriately and ensure timely payments to avoid penalties.

2. Leverage Deductions: Tax laws offer a plethora of deductions and benefits tailored to various financial situations. Understanding and utilizing them can lead to significant savings.

3. Seek Professional Help: Given the complexity of tax codes, consulting with a tax professional can maximize benefits and minimize errors.

4. Stay Informed: Continuous learning about tax laws empowers individuals to make informed financial decisions and capitalize on available incentives.

5. Balance Benefits and Drawbacks: While deductions like the home office offer advantages, it's essential to be aware of potential long-term implications.

Conclusion

The "My Favorite Day of the Year!" episode of Armstrong & Getty On Demand serves as an invaluable guide for anyone navigating the labyrinthine world of taxes. With Stephen Moskowitz's expert insights, listeners gain a clearer understanding of how to optimize their tax strategies, avoid common pitfalls, and harness the full potential of available deductions. Whether you're a freelancer, a business owner, or an individual taxpayer, this episode equips you with the knowledge to approach taxes with confidence and strategic intent.

For more insights and detailed discussions, tune into the full episode of Armstrong & Getty On Demand.