“I’ve Made A Huge Mistake”

Summary

Podcast Summary: “I’ve Made A Huge Mistake”
The Ramsey Show Highlights
Release Date: January 24, 2025
Host: Ramsey Network
Featuring: Dave Ramsey, George Kamel

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Introduction

In the episode titled “I’ve Made A Huge Mistake,” The Ramsey Show Highlights delves into the challenging situation of a caller, Chad, who finds himself grappling with unfiled business taxes. Hosted by the Ramsey Network and featuring insights from financial experts Dave Ramsey and George Kamel, this episode offers a comprehensive guide for individuals facing similar financial predicaments.

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Caller’s Story: Chad’s Struggle with Unfiled Taxes

[00:02 – 01:45]

Chad, a businessman in the construction industry, reaches out to the show seeking urgent advice. He shares his predicament:

• Business History: Started his construction business in 2017, paused operations at the end of 2019, worked for another company, and resumed his business in 2022.
• Tax Issues: Admits to never having paid or filed business taxes, though he has consistently filed his W-2s from his full-time employment.
• Financial Status: Over the past two years, Chad's business has performed well, but he only has approximately $10,000 in savings.
• Emotional Toll: Expresses significant stress and uncertainty about how to address his tax obligations, stating, “I don’t know where to start” (00:02).

Chad elaborates on his financial journey, mentioning the initial struggles in the first year and moderate success in the second, which ultimately wasn’t sufficient to cover both personal and business expenses.

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Dave Ramsey’s Encouragement: A Path Forward

[03:04 – 03:44]

Dave Ramsey responds with empathy and encouragement:

• Non-Judgmental Support: “We could sit here and beat you up for being dumb over the last seven years. You got a family. Not going to do that. I'm gonna tell you, I'm proud of you for today being the day we're going to come clean” (03:04).
• Emotional Relief: Emphasizes the importance of confronting the issue head-on to avoid further emotional and mental strain: “You have put an extra 10 years of life miles on your heart and on your brain” (03:26).
• Family Communication: Encourages Chad to have honest conversations with his family to prevent additional stress: “Let this be the moment that if you have a hard conversation with your wife... we’re going to handle that stuff as they come up day of” (03:26).

Dave underscores the significance of taking responsibility and seeking help, highlighting that facing the problem is the first step towards resolution.

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George Kamel’s Practical Advice: Steps to Resolve Tax Issues

[03:44 – 05:30]

George Kamel provides a structured approach for Chad to tackle his tax issues:

1. Assess the Damage:

   • Gather all financial records, including income, expenses, payroll taxes, and previous tax filings (03:44).
   • Determine the total amount owed.

2. Seek Professional Help:

   • Contact a qualified CPA through Ramsey’s network at ramseysolutions.com/tax. Emphasizes that this is not a DIY situation and professional guidance is crucial (04:17).

3. Proactive IRS Engagement:

   • Approach the IRS proactively to explain the situation, which can help in reducing penalties.
   • Discuss potential payment plans to manage the debt over time (04:41).

4. Lifestyle Adjustments:

   • Prepare for significant lifestyle changes, including living on 30-40% of current income to allocate funds towards tax liabilities (04:55).
   • Acknowledge the sacrifices required to rectify the financial situation (05:19).

George stresses the importance of taking immediate and organized action to minimize further financial damage, highlighting that although the process will be challenging, it is manageable with the right support.

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Family and Emotional Considerations: Honesty and Integrity

[05:30 – 07:48]

The discussion shifts to the personal and familial impact of Chad’s financial issues:

• Family Communication: Dave urges Chad to sit down with his wife and daughter to openly discuss the financial situation and the steps being taken to resolve it: “I want you to sit down and say, I've made a huge mess. I don't know where to start. I need some help” (06:00).
• Modeling Integrity: Emphasizes the importance of demonstrating integrity and honesty to his family, reinforcing that they are now “people of integrity” and will handle affairs the right way moving forward (07:02).
• Emotional Release: Acknowledges the emotional burden Chad has been carrying and the liberation that comes with confronting the issue: “A lot of this is the emotional just buildup of seven years of burying this and burying this. And now we got to do some excavating” (07:48).

This segment highlights how addressing financial problems transparently can strengthen family bonds and reduce emotional stress.

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Action Steps and Final Encouragement

[07:48 – 08:03]

In the concluding remarks:

• Immediate Action: Dave and George reinforce the urgency of addressing the issue without delay: “Make 2025 the year. You just head straight into these things. Them over with” (07:48).
• Long-Term Commitment: Emphasize that while the journey will be difficult, committing to resolving the issue now will lead to long-term financial stability and peace of mind.

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Notable Quotes

• Dave Ramsey at [03:04]: “We could sit here and beat you up for being dumb over the last seven years. You got a family. Not going to do that. I'm gonna tell you, I'm proud of you for today being the day we're going to come clean.”

• George Kamel at [04:17]: “This is not a DIY situation.”

• Dave Ramsey at [06:00]: “I've made a huge mess. I don't know where to start. I need some help.”

• Dave Ramsey at [07:02]: “In this house, from this day forward, we're people of integrity. We do things the right way.”

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Conclusion

“I’ve Made A Huge Mistake” serves as a compelling narrative for individuals facing financial and tax-related challenges. Through Chad’s story, Dave Ramsey and George Kamel provide a blend of emotional support and practical advice, emphasizing the importance of honesty, professional assistance, and proactive measures. The episode underscores that while financial mistakes can be daunting, addressing them head-on with integrity and the right guidance can pave the way towards recovery and stability.

Transcript

[Chad]

Brought to you by Y Refi Refinance your defaulted private student loans [e-mail] Ramsey I started my. I'm in the construction industry. I started my business in 2017, ran it for till the end of 2019, then started working for somebody and then picked up my business again in 2022. Until recent. Until today still. And I never paid taxes, and I've never filed business taxes. And I'm at a point now where I don't know where to. I don't know what to do. I don't know where to start.

[Dave]

Have you guesstimated how bad it is? Let me ask you this way. Have you made money? Have you done well over the last few years?

[Chad]

The past two years have been very well. Okay.

[George]

Do you have any money currently? You got money saved?

[Chad]

I mean, we probably around ten grand. Is it?

[Dave]

Oh, boy.

[Chad]

And I don't know. I don't even know where to begin. And trying to do everything right, and this is something that keeps me up.

[George]

What stopped you? Because you knew day one, all right, I got a business. I make money. I got to pay the piper. What caused you to go. I'm gonna bury my head in the sand? Did it just become too much after year one or two or what?

[Chad]

Yeah, the first year was a little rough, just trying to make it. And then the second year was pretty decent, but it was still, you know, still rough. I was basically using everything to just pay for my life, pay for my everything.

[George]

And so when was your last tax return that you file? What year?

[Chad]

So I did one last year. So I have my business, and I still work full time with a company, so I have a W2 that I have filed. So I've been filing W2s, but it's. It's my side business that's been. That's been.

[Dave]

So if you. If you had to ballpark the last seven years, what you've made minus what you like, like. Yeah, you know, your. Your profit. Your profit. Right. Times 35%.

[Chad]

Yeah. What's.

[Dave]

I mean, what's 35 of that profit number, do you think? Are you talking a hundred thousand dollars? You're talking 500, 000?

[Chad]

No, it's not. Not near that. It's probably around a hundred thousand at this point.

[Dave]

Okay.

[Chad]

I would say.

[Dave]

What. What's your call, the conscience? Is it just like New year? New you like 20, 25? We got to get this thing right?

[Chad]

No, I've been trying to figure out what to do for probably about a year now. And I. I'm at. I'm at the point now it's. I've got a. I. I have to secure, you know, the rest of my future and my. With my family, and I gotta. Everything's. I have to be. I have to do everything right now.

[Dave]

So George is going to walk you through it. But I want to tell you two things. Number one, we could sit here and beat you up for being dumb over the last seven years. You got a family. Not going to do that. I'm gonna tell you, I'm proud of you for today being the day we're going to come clean. We're going to get this thing right. Okay.

[Chad]

Yes. Appreciate that.

[Dave]

Second thing is, you have put an extra 10 years of life miles on your heart and on your brain.

[Chad]

Yeah.

[Dave]

And let this be the moment that if you have a hard conversation with your wife, with your kids, with your kids, schools, with what, an employee, that we're going to handle that stuff as they come up day of so that we don't add any extra miles to our soul. Right.

[Chad]

Absolutely.

[Dave]

Good on you.

[George]

All right.

[Dave]

It's gonna. Hey, it's gonna suck.

[George]

All right.

[Dave]

It's not gonna be fun, but we're gonna get on it. We're gonna do it right.

[George]

So, Chad, the first thing like John was talking about, we need to assess the damage. So you need to get all the financial records you can figure out what amounts are owed, income, payroll taxes, federal, state, local, you name it. Get all the documents you can get, expense records, prior tax filings. Once you have all that, you need to contact a really good CPA. And if you go to ramseysolutions.com tax, we have a network of these pros that can help walk you through this. But you're going to need a pro. This is not a DIY situation.

[Chad]

I. I knew that from. Yeah, I mean, that's where I. But I don't. I was. I'm like, at the point where I was like, do I need to get a tax attorney? I mean, not just a cpa. I don't know what to do.

[George]

Well, they'll be able to direct you and say, hey, this is attorney level. It may not be. You don't know yet.

[Dave]

I think you'll end up there unless you can come up with a big chunk of money. But that's a problem for future you. Let's just do the next right thing right in front of us.

[Chad]

Right.

[George]

And the goal is you want to be proactive, calling the irs, explaining the situation, that can actually reduce your penalties and likely what they're going to say is, well, how much can you pay now? Because that's going to help you reduce penalties in the future. And then what does this payment plan look like?

[Chad]

Yeah.

[George]

And so you're going to have to pay the piper here. But the goal is to now minimize more damage, like, more damage being created. And so that's where being really proactive, explaining the whole situation, getting with a good CPA and figuring out a game plan and the next few years of your life are going to look drastically different. You're going to have to learn to live on 30, 40% of your income because the rest of it is going to pay for the past.

[Chad]

Right.

[George]

I mean, that's the hardest part, is the sacrifice your lifestyle is about to take.

[Dave]

But it's not as hard as going to jail for tax evasion.

[George]

Exactly.

[Chad]

Oh, no. Yeah, That's. That's.

[George]

Those are your options.

[Dave]

Yeah, yeah, yeah.

[Chad]

I literally. I've literally thought about every scenario you could ever think of, and that's. That's where I'm at. I'm.

[Dave]

How old are your kids? Brother?

[Chad]

I'll do. My daughter's a. She's out of high school now, so I don't. It's not a young family, but it's still my wife, you know, she's. She's wanting to start a business. And. And it's just like we're. We. We need to get everything done 100 right now.

[Dave]

I mean, can I tell you what's going to free you?

[Chad]

Yeah.

[Dave]

It's gonna sound nuts after you call this. Once you get online like George said, and get with a Ramsey Tax Pro, I want you to sit down and say, I've made a huge mess. I don't know where to start. I need some help. And they will give you a step by step guide. Okay. That's number one. There's a chance that with your business not being so great most of the time and your expenses and buying tools and wood and whatever else you're doing, you. It may not be as bad as. As us just sitting here thinking it is. Right.

[Chad]

Right. Yeah.

[Dave]

But there's an existential part of this, and I want you to sit down with your wife and your daughter at your kitchen table, and I want you looking both in the eye and say, I messed up.

[Chad]

And I think my wife's aware and she's.

[Dave]

I know, but I want your daughter. I want your daughter to participate and see what it looks like when a man tells the truth.

[Chad]

Right.

[Dave]

And when a man says the words their dad says, the words. I'm sorry. And here's what I'm doing now, because your daughter's going to be a part. Your wife's going to be a part of the sacrifice moving forward, like George said.

[Chad]

Right.

[Dave]

Yeah. They're going to have way less disposable income. Daughter may not have the car that she was hoping to get. She may not be able to go to college she was hoping to go to. Right. Maybe.

[Chad]

Yeah. That's where.

[Dave]

Maybe not. Maybe not. But I. You're going to be free because you're going to have put everything out on the table for her. And she needs to know dad has a plan. Dad's calling a professional. Dad called a couple of knuckleheads on. On a YouTube show, on a podcast. And so that was huge. But Dad's got a plan. We're mo forward. And in this house, from this day forward, we're people of integrity. We do things the right way.

[Chad]

Right. I really. Yeah. I really appreciate that.

[Dave]

You got it.

[George]

They were free.

[Dave]

You. If you do that.

[George]

Yeah. A lot of this is the emotional just buildup of seven years of burying this and burying this. And now we got to do some excavating.

[Dave]

That's right. It's 2025. Listen, conflict deferred is conflict amplified. Whatever hard conversations or tough decisions you need to make right now will be worse the longer you wait. Make 2025 the year. You just head straight into these things. Them over with.

[Chad]

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