WEBVTT NOTE This file was generated by Descript 00:00:04.981 --> 00:00:08.101 Welcome to the Fiscal Firehouse, a podcast dedicated to promoting 00:00:08.101 --> 00:00:10.021 financial literacy to firefighters. 00:00:10.171 --> 00:00:14.761 I'm your co-host, John Beatty, executive board member of Local 1309, a lieutenant, 00:00:14.851 --> 00:00:16.891 and also a certified financial planner. 00:00:17.221 --> 00:00:21.781 With me, I have the other co-host of the fiscal firehouse, Louis Barella, executive 00:00:21.781 --> 00:00:25.891 Board member of Local 1309 ambulance driver, and want to be financial expert. 00:00:26.491 --> 00:00:29.551 Together, John and I hope to bring clarity to the world of personal finance, 00:00:29.581 --> 00:00:31.321 specifically relating to firefighters. 00:00:31.861 --> 00:00:34.321 Firefighting is a difficult job making sound. 00:00:34.321 --> 00:00:35.686 Financial decisions shouldn't be. 00:00:36.241 --> 00:00:39.151 In today's episode of the fiscal firehouse, John and Louis Tackle 00:00:39.151 --> 00:00:43.381 the most talked about recent federal legislation, OBA Standing 00:00:43.381 --> 00:00:45.211 for one Big, beautiful Bill Act. 00:00:45.751 --> 00:00:48.781 John and Louis will discuss both the financial and non-financial 00:00:48.781 --> 00:00:52.951 implications of this recent federal legislation and how it will impact 00:00:52.951 --> 00:00:54.631 you as a professional firefighter. 00:00:55.231 --> 00:00:58.711 John and Louis specifically addressed concerns around tax rates, tax 00:00:58.711 --> 00:01:03.541 deductions, including the infamous no tax on tips and other financial matters. 00:01:04.081 --> 00:01:07.621 Without further ado, let's kick it over to local 1309 studios and the 00:01:07.621 --> 00:01:09.451 recording of the fiscal Firehouse 00:01:12.511 --> 00:01:15.631 Jon: welcome back to another episode of The Physical Firehouse. 00:01:16.111 --> 00:01:19.831 I'm with your co-host John Beatty, with me I've got my partner in crime 00:01:19.831 --> 00:01:25.201 here sitting across the table in Local 1309 studios, old LB Louis Barella. 00:01:25.201 --> 00:01:25.711 How's it going? 00:01:25.716 --> 00:01:25.766 Lb. 00:01:26.221 --> 00:01:26.611 Louie: Good buddy. 00:01:26.611 --> 00:01:27.151 How are you 00:01:27.196 --> 00:01:27.556 Jon: man? 00:01:27.556 --> 00:01:28.636 We are ready to rock. 00:01:28.636 --> 00:01:30.976 It is, the start of the NFL season. 00:01:31.336 --> 00:01:32.716 So we're recording this. 00:01:32.956 --> 00:01:34.216 Do, do, do, yeah. 00:01:34.216 --> 00:01:34.966 How does it go? 00:01:35.026 --> 00:01:36.206 What's the, rest of the jingle? 00:01:38.066 --> 00:01:38.666 There you go. 00:01:38.666 --> 00:01:39.326 You got it? 00:01:39.506 --> 00:01:39.836 Yep. 00:01:39.836 --> 00:01:42.666 So today is, what is it, Thursday, September. 00:01:42.896 --> 00:01:44.006 fourth, whenever. 00:01:44.346 --> 00:01:45.336 but it's the kickoff. 00:01:45.336 --> 00:01:46.506 It's the NFL kickoff. 00:01:46.506 --> 00:01:48.066 So we're all excited. 00:01:48.136 --> 00:01:49.246 Cowboys, eagles. 00:01:49.246 --> 00:01:49.876 What are you thinking? 00:01:49.876 --> 00:01:50.946 Who's, who you going on? 00:01:50.946 --> 00:01:52.326 You a dirty bird or are you like 00:01:52.391 --> 00:01:52.661 Louie: Eagles. 00:01:52.661 --> 00:01:53.981 Man, I, I can't stand the 00:01:54.231 --> 00:01:54.691 Jon: You can't. 00:01:54.796 --> 00:01:55.516 Louie: I don't want them to. 00:01:55.686 --> 00:01:56.226 Jon: Hey man, 00:01:56.291 --> 00:01:57.911 Louie: I, let's, let's go Eagles. 00:01:57.911 --> 00:02:01.121 Anyone who, who goes against the Cowboys I'm pretty much cheering for 00:02:01.316 --> 00:02:02.456 Jon: Exactly, yeah. 00:02:02.456 --> 00:02:03.896 Well, they gave me the gift. 00:02:03.946 --> 00:02:06.106 Christmas came early at the Beatty household and they 00:02:06.106 --> 00:02:07.636 traded us, Michael Parsons. 00:02:07.921 --> 00:02:08.221 Louie: Oh, yeah. 00:02:08.566 --> 00:02:09.016 Jon: So for the 00:02:09.541 --> 00:02:10.171 Louie: There you go. 00:02:10.486 --> 00:02:12.166 Jon: Jones is my new favorite owner. 00:02:12.226 --> 00:02:15.886 I really think he's going in the running to try to be the worst NFL owner. 00:02:15.946 --> 00:02:18.046 He's right neck and neck with a Browns 00:02:18.146 --> 00:02:19.226 Louie: he's only getting worse. 00:02:19.256 --> 00:02:21.416 So if he's not the worst right now, give it another couple 00:02:21.416 --> 00:02:22.856 years and he definitely will be, 00:02:22.871 --> 00:02:24.341 Jon: he will definitely be worse. 00:02:24.341 --> 00:02:27.451 He's, he's doing his, his best, to try to take that title. 00:02:27.451 --> 00:02:29.071 So, you know, I got a funny story. 00:02:29.071 --> 00:02:35.081 So my kids, my, my oldest Ellis is eight and, he started his own NFL, fantasy 00:02:35.091 --> 00:02:35.121 Louie: football. 00:02:35.121 --> 00:02:35.686 Fantasy football. 00:02:35.776 --> 00:02:36.046 Okay, 00:02:36.161 --> 00:02:38.651 Jon: So he is got like eight little cronies in the neighborhood and 00:02:38.651 --> 00:02:41.631 they all kind of set up their, their teams and, everyone else, 00:02:41.631 --> 00:02:43.731 all their seven did auto draft. 00:02:43.791 --> 00:02:45.591 So just whatever the computer kicked out. 00:02:46.386 --> 00:02:49.596 Ellis decided that he wanted to, to draft his own players. 00:02:49.601 --> 00:02:50.431 I'm like, this is political. 00:02:50.811 --> 00:02:51.696 I'm like, this is cool. 00:02:51.696 --> 00:02:56.506 So Ellis and my wife Katie, they sat down and they picked and, let's just 00:02:56.506 --> 00:02:58.246 say he's got a few lessons to learn. 00:02:58.336 --> 00:03:01.246 So, I don't know, do you ever, do you, are you in a fantasy league? 00:03:01.246 --> 00:03:02.476 Do you, do you do any of that 00:03:02.626 --> 00:03:07.426 Louie: we were, we had a, a family fantasy football league for a long time. 00:03:07.486 --> 00:03:07.516 Okay. 00:03:07.521 --> 00:03:07.681 Yep. 00:03:08.006 --> 00:03:10.976 and bunch of our, bunch of the guys in our family were, was 00:03:10.976 --> 00:03:12.786 in it including, Colin Stookey. 00:03:13.026 --> 00:03:13.176 Okay. 00:03:13.176 --> 00:03:13.236 Yeah. 00:03:13.286 --> 00:03:16.526 who is a great fantasy footballer, like he's super into it. 00:03:16.796 --> 00:03:17.936 But we got toxic. 00:03:17.966 --> 00:03:20.756 Like our family started getting toxic, like there was some. 00:03:21.806 --> 00:03:24.506 There was some questionable interactions that we started having with each 00:03:24.506 --> 00:03:25.556 other, and we had to step back. 00:03:25.556 --> 00:03:28.196 We were like, for the sake of the love that we have for one 00:03:28.196 --> 00:03:31.586 another, we need to stop this league and take some, take a break. 00:03:31.586 --> 00:03:33.386 So we've been on a break for a couple years. 00:03:33.431 --> 00:03:33.721 Jon: Okay. 00:03:33.721 --> 00:03:34.681 You a little hiatus 00:03:34.796 --> 00:03:35.126 Louie: now. 00:03:35.126 --> 00:03:35.426 Yeah. 00:03:35.426 --> 00:03:36.836 We're very competitive in the family. 00:03:36.836 --> 00:03:39.416 We all wanna win the punishments for the losers. 00:03:39.416 --> 00:03:40.046 We're getting. 00:03:40.126 --> 00:03:41.176 Pretty little excessive. 00:03:41.206 --> 00:03:41.596 Yeah. 00:03:41.596 --> 00:03:42.736 I mean, they were pretty bad. 00:03:42.736 --> 00:03:44.386 So we took a break. 00:03:44.416 --> 00:03:45.466 We might start it back up. 00:03:45.466 --> 00:03:46.696 We call it the Sons of Genevieve. 00:03:46.696 --> 00:03:47.836 Genevieve was my grandmother. 00:03:48.016 --> 00:03:48.046 Okay. 00:03:48.046 --> 00:03:49.876 The Sons of Genevieve Fantasy Football League. 00:03:49.906 --> 00:03:50.296 I don't know. 00:03:50.296 --> 00:03:52.726 I might make an appearance in the next year or two, but not this year. 00:03:52.751 --> 00:03:53.536 Not this year, no. 00:03:53.606 --> 00:03:53.996 Jon: Yeah. 00:03:53.996 --> 00:03:57.026 So I mean, so you've got strategy, so you've played, and honestly, 00:03:57.026 --> 00:03:58.496 I've never been in any league. 00:03:58.806 --> 00:04:00.156 I actually, after kind of. 00:04:00.246 --> 00:04:03.126 You know, going through this with Ellis, it's really kind of intrigued me. 00:04:03.126 --> 00:04:04.776 I'm like, oh, maybe I should do that next year. 00:04:04.776 --> 00:04:07.716 Like it's, I, I see why so many people are obsessed, oh my God, 00:04:07.806 --> 00:04:11.466 with this thing because it's, it is very, I mean, and there's the highs 00:04:11.466 --> 00:04:12.716 and the lows, but, I don't know. 00:04:12.716 --> 00:04:16.046 From a strategy standpoint, what do you think his number one pick was? 00:04:16.046 --> 00:04:17.186 Or who is his number one pick? 00:04:17.186 --> 00:04:21.056 If you, thinking about this from a league owner, and you've obviously played in 00:04:21.056 --> 00:04:25.136 fantasy leagues, like, I mean, wide receivers I heard are valuable running 00:04:25.136 --> 00:04:27.476 backs, quarterbacks are valuable, 00:04:27.531 --> 00:04:28.551 Louie: quarterbacks are not. 00:04:28.551 --> 00:04:30.921 I guess it depends on if you're in a point per reception. 00:04:30.951 --> 00:04:31.101 Okay. 00:04:31.161 --> 00:04:32.361 Or a half point 00:04:32.376 --> 00:04:34.896 Jon: But typically, wide receivers, running backs, those are 00:04:35.121 --> 00:04:36.471 Louie: Those are the, those are who you go with. 00:04:36.471 --> 00:04:38.291 Like, I think a lot of, expert. 00:04:38.711 --> 00:04:39.641 Fantasy footballers. 00:04:39.641 --> 00:04:41.916 They don't draft quarterbacks until very, very late. 00:04:42.031 --> 00:04:42.506 Jon: The very 00:04:42.521 --> 00:04:45.041 Louie: I'm talking like sixth round or something like that. 00:04:45.401 --> 00:04:45.431 Okay. 00:04:45.431 --> 00:04:50.171 People just stock up on wide receivers and running backs, and that is generally 00:04:50.171 --> 00:04:52.031 considered the best advice, I think. 00:04:52.151 --> 00:04:52.391 Jon: Okay. 00:04:52.611 --> 00:04:55.921 so, his number one draft, what do, what do you think? 00:04:56.021 --> 00:04:58.721 Louie: Oh, is it a running backer, a wide receiver? 00:04:58.781 --> 00:05:00.581 Jon: it was the Broncos defense. 00:05:01.391 --> 00:05:01.481 Oh no. 00:05:01.481 --> 00:05:03.456 He picked as his number one draft pick. 00:05:03.581 --> 00:05:05.231 Louie: I mean, they might be the best defense. 00:05:05.381 --> 00:05:08.891 This, they, that's a good pick from a defensive perspective, but definitely not. 00:05:08.966 --> 00:05:10.076 Jon: Definitely not. 00:05:10.181 --> 00:05:11.831 Louie: He's got, he's got a learning curve. 00:05:11.936 --> 00:05:14.996 Jon: He's got a little learning curve and it was a teachable moment and he is like, 00:05:15.026 --> 00:05:16.736 oh, okay, I start to understand this. 00:05:16.736 --> 00:05:19.736 So the other kids that did the autodraft, they were not as lucky to 00:05:19.736 --> 00:05:22.016 have this from a teachable moment. 00:05:22.016 --> 00:05:26.696 So, Ellis, I know he listens to this occasionally in the car, so yeah. 00:05:26.696 --> 00:05:28.981 Son, when you're thinking about, who you wanna draft. 00:05:29.501 --> 00:05:32.441 Wide receiver or running back should be your first couple draft picks. 00:05:32.441 --> 00:05:32.531 Nice. 00:05:32.941 --> 00:05:35.161 don't save your second pick for the kicker. 00:05:35.586 --> 00:05:36.526 Oh, geez. 00:05:36.621 --> 00:05:38.331 Louie: He went like in reverse order of important. 00:05:38.331 --> 00:05:40.131 Those are the, what you should say for the very end. 00:05:40.131 --> 00:05:40.161 He 00:05:40.231 --> 00:05:40.501 Jon: did. 00:05:40.501 --> 00:05:40.981 He did. 00:05:40.981 --> 00:05:44.041 So at the very end it's, it's kind of q it, it tells 'em like 00:05:44.041 --> 00:05:47.071 what their grade score is like based on what the algorithm says. 00:05:47.071 --> 00:05:47.821 did you get an A? 00:05:47.821 --> 00:05:48.631 Did you get a b? 00:05:49.026 --> 00:05:50.136 He got an F minus, 00:05:51.486 --> 00:05:52.746 Louie: He's probably gonna win the whole thing. 00:05:52.776 --> 00:05:52.866 Jon: thing. 00:05:52.866 --> 00:05:54.906 You know what, it's probably one of those things. 00:05:54.906 --> 00:05:55.986 It's like picking stocks. 00:05:55.986 --> 00:05:56.046 Yeah. 00:05:56.286 --> 00:05:59.796 Like honestly, like they do those, they do this all the time where they just 00:05:59.796 --> 00:06:03.996 have some random algorithm generator just kick out a name and then they put 00:06:03.996 --> 00:06:08.616 that against a stock picking professional and nine times outta 10 who wins. 00:06:09.536 --> 00:06:10.226 The random 00:06:10.266 --> 00:06:11.196 Louie: random generator? 00:06:11.256 --> 00:06:11.466 Yeah. 00:06:11.636 --> 00:06:13.346 Jon: like, I'll just see what sticks on the wall. 00:06:13.346 --> 00:06:18.116 So we're always gonna tie this back to, to something fiscal in the firehouse. 00:06:18.116 --> 00:06:22.666 But, and we know we've got a lot of DGN listeners, so, ease off 00:06:22.666 --> 00:06:24.136 on some of those fantasy drafts. 00:06:24.136 --> 00:06:26.536 Don't, don't be parlaying on anything. 00:06:26.866 --> 00:06:29.086 You know, we will put up the gamblers anonymous. 00:06:29.941 --> 00:06:32.041 phone number or website on this. 00:06:32.041 --> 00:06:33.331 But, all in good fun though. 00:06:33.331 --> 00:06:34.961 But I definitely see what the excitement is. 00:06:34.961 --> 00:06:36.191 And man, I'm excited. 00:06:36.221 --> 00:06:37.541 I'm excited for the NFL. 00:06:37.871 --> 00:06:39.011 It's just something in the air. 00:06:39.041 --> 00:06:39.101 Yeah. 00:06:39.131 --> 00:06:39.641 This time of 00:06:39.846 --> 00:06:40.356 Louie: in general. 00:06:40.396 --> 00:06:41.016 Jon: Oh, love it. 00:06:41.316 --> 00:06:41.766 Louie: Let's go. 00:06:41.976 --> 00:06:42.056 Jon: it. 00:06:42.311 --> 00:06:43.061 All right. 00:06:43.341 --> 00:06:47.601 as we promised, we are gonna talk about the BB. 00:06:47.601 --> 00:06:47.991 B. 00:06:48.461 --> 00:06:48.761 Big. 00:06:48.871 --> 00:06:49.471 Louie: Beautiful. 00:06:49.531 --> 00:06:51.451 It's the biggest, the beautiful list. 00:06:52.451 --> 00:06:56.531 Jon: It is, it's the big beautiful bill, or I guess it's one big beautiful bill 00:06:56.531 --> 00:06:58.451 Act is technically what it's called. 00:06:58.451 --> 00:07:02.071 But yeah, this is the legislation that, a lot of people are talking about. 00:07:02.321 --> 00:07:05.951 I know for those of you, if you do have a financial professional or advisor, 00:07:05.951 --> 00:07:10.451 they've probably sent you a, a newsletter or maybe a webinar or something, 00:07:10.451 --> 00:07:11.891 highlighting some of these changes. 00:07:11.891 --> 00:07:14.821 But, Louis and I thought it was important that we talk about this. 00:07:15.196 --> 00:07:17.596 both fielded quite a bit of questions regarding this. 00:07:17.756 --> 00:07:20.786 and there's a lot of things that will affect us, not only as just regular 00:07:20.786 --> 00:07:24.696 taxpayers, and people with incomes, but specifically within our own 00:07:24.696 --> 00:07:28.476 industry, firefighting, talking about overtime and some of the other things. 00:07:28.476 --> 00:07:30.516 So we're gonna do some quick highlights on some of these things. 00:07:30.516 --> 00:07:33.766 Once again, we wanna make this tailored, to professional firefighters, 00:07:33.766 --> 00:07:35.986 so stay tuned for all the updates. 00:07:36.311 --> 00:07:39.861 Louie: and I think, John, and I feel like we're the kings of disclaimers, 00:07:40.221 --> 00:07:43.551 so it probably goes without saying, but we're not tax professionals, so we 00:07:43.551 --> 00:07:47.841 don't know the implications to every tax situation or every firefighter. 00:07:48.051 --> 00:07:49.731 And the truth is like, this is a massive bill. 00:07:49.731 --> 00:07:54.291 We can't even discuss all of the different changes and all 00:07:54.291 --> 00:07:55.461 the things that it touches. 00:07:55.701 --> 00:07:56.841 We're just kind of hitting the highlights. 00:07:56.841 --> 00:07:58.671 Like John said, that applies to firefighters. 00:07:59.071 --> 00:08:00.151 but it might not be. 00:08:00.211 --> 00:08:02.701 Specific to your situation, and that's okay too. 00:08:03.061 --> 00:08:05.491 This is just more general knowledge and things that we found interesting. 00:08:05.491 --> 00:08:09.121 I think another important thing to remember is that some of this stuff 00:08:09.121 --> 00:08:10.171 is still kind of up in the air. 00:08:10.201 --> 00:08:13.831 Like the way Congress loves to operate is they pass a bill and then they leave 00:08:13.831 --> 00:08:17.011 it for other people to figure out like how it's implemented and what it's 00:08:17.011 --> 00:08:18.811 gonna look like, and is it feasible. 00:08:19.151 --> 00:08:22.586 it's a really weird way that, We do things, at a, at the federal level, 00:08:22.586 --> 00:08:23.576 but that's just kinda how it works. 00:08:23.576 --> 00:08:26.306 So we think we kind of have an understanding on how some of these 00:08:26.306 --> 00:08:29.996 things are gonna work, but it, it, who's to say it doesn't change 00:08:29.996 --> 00:08:33.176 or some court doesn't overrule a certain aspect of it or something. 00:08:33.176 --> 00:08:36.566 So just keep that in mind as we talk about these different 00:08:36.566 --> 00:08:38.906 aspects that it's going to impact. 00:08:39.001 --> 00:08:41.221 Jon: Yeah, no, that's, that's definitely well said, Louie. 00:08:41.431 --> 00:08:44.521 And this is something that, I looked it up and, you know, a lot of sources 00:08:44.521 --> 00:08:49.231 say that this is o this is over 1100 pages of legislation, so there's a lot 00:08:49.231 --> 00:08:52.741 of one-offs and outliers, and we're not gonna talk about all those things. 00:08:52.741 --> 00:08:54.871 Most, specifically though, we want to talk about what's gonna 00:08:54.871 --> 00:08:58.021 affect people around the firehouse table and, and your families. 00:08:58.021 --> 00:09:02.341 And honestly, overall, from a financial standpoint, this is, and, and. 00:09:02.881 --> 00:09:06.511 You know, most people's best interest from a tax perspective, it is gonna 00:09:06.511 --> 00:09:09.271 keep tax rates low and there's some additional credits and some 00:09:09.271 --> 00:09:10.681 benefits that we'll talk about. 00:09:10.741 --> 00:09:14.531 But, before we talk about the financial aspects, that's really what's been 00:09:14.531 --> 00:09:16.991 highlighted in this bill, but there's a lot of other things that the 00:09:16.991 --> 00:09:21.231 federal government did, in order to help offset the cost of what this is 00:09:21.231 --> 00:09:23.151 gonna be over the next decade or so. 00:09:23.311 --> 00:09:25.576 and the one that is the most important, I think. 00:09:25.881 --> 00:09:29.511 From, once again, from the firefighter's perspective and something that will 00:09:29.511 --> 00:09:33.691 affect most firefighters, is this Medicaid restructuring and funding. 00:09:34.091 --> 00:09:37.121 And most of you are probably like, well, who cares about Medicaid? 00:09:37.121 --> 00:09:37.511 Honestly? 00:09:37.511 --> 00:09:38.891 They're like, I've got insurance. 00:09:38.891 --> 00:09:40.031 I've gotten good insurance. 00:09:40.181 --> 00:09:41.141 I'm not on Medicaid. 00:09:41.141 --> 00:09:42.371 My family's not on Medicaid. 00:09:42.371 --> 00:09:44.291 I got good insurance through the department. 00:09:44.636 --> 00:09:46.496 Why does this matter to me? 00:09:46.586 --> 00:09:50.006 Well, it matters to you for kind of a, a two-pronged approach. 00:09:50.286 --> 00:09:53.716 the first is most people probably listening to this, do 00:09:53.716 --> 00:09:55.726 some type of fire based EMS. 00:09:55.786 --> 00:09:58.906 So you have ambulances and you transport, and because of those 00:09:58.906 --> 00:10:03.136 transports you get reimbursed by either Medicaid or Medicare or private 00:10:03.136 --> 00:10:04.456 payer or whatever that insurance looks 00:10:04.481 --> 00:10:04.601 Louie: like. 00:10:04.601 --> 00:10:09.251 And let's be real, most of the people you transport are on medic, are on Medicaid. 00:10:09.251 --> 00:10:12.431 They're not paying with their private Cadillac health insurance. 00:10:12.431 --> 00:10:14.771 Those are not the people calling 9 1 1 for transport. 00:10:14.936 --> 00:10:17.396 Jon: And I actually wish I had the stats to, to talk about 00:10:17.396 --> 00:10:20.636 that, but it is primarily funded through Medicaid or Medicare 00:10:20.771 --> 00:10:20.861 Louie: mm-hmm. 00:10:21.116 --> 00:10:23.866 Jon: what the majority of our, our, what our patients that 00:10:23.866 --> 00:10:25.456 we take to the hospital have. 00:10:25.486 --> 00:10:31.276 So why this is a big deal in order to help fund some of these tax cuts is, basically 00:10:31.336 --> 00:10:35.536 the federal government is restructuring Medicaid and they're slashing it. 00:10:35.601 --> 00:10:36.861 I mean, that's probably the easiest 00:10:36.871 --> 00:10:36.961 Louie: way. 00:10:36.961 --> 00:10:37.531 They're slashing. 00:10:37.701 --> 00:10:38.511 Jon: They're slashing it. 00:10:38.511 --> 00:10:43.761 what I've got is there's somewhere between 600 to 800 billion over the next decade is 00:10:43.761 --> 00:10:48.951 gonna be removed from the Medicaid funding status, which is a crap ton of money. 00:10:49.371 --> 00:10:49.821 Alright? 00:10:49.821 --> 00:10:51.681 And why that matters is. 00:10:51.736 --> 00:10:55.576 currently when you're getting reimbursed is we get a certain percentage and 00:10:55.576 --> 00:10:58.876 then most states have been back filling that percentage to basically make the 00:10:58.876 --> 00:11:03.176 department whole, speaking for us, west Metro, that's almost to the tune 00:11:03.206 --> 00:11:08.576 of $6 million shortfall this year that we're gonna receive from Medicaid that 00:11:08.576 --> 00:11:12.306 we had planned on receiving before this legislation took a took effect. 00:11:12.306 --> 00:11:14.436 So that's a huge, that's a huge impact. 00:11:14.466 --> 00:11:18.951 Louie: direct, it's directly impacting us because now we have, like you said, $6 00:11:18.951 --> 00:11:22.146 million less in our budget for next year. 00:11:22.266 --> 00:11:22.956 Jon: For next year. 00:11:22.956 --> 00:11:24.966 And we don't know what that will look like for the following 00:11:24.966 --> 00:11:25.716 year and everything else. 00:11:25.716 --> 00:11:28.506 So you can probably extrapolate that over the next, several years. 00:11:28.506 --> 00:11:32.196 And that's a significant hole that we're gonna have to try to plug with additional 00:11:32.196 --> 00:11:34.146 revenues or other funding streams. 00:11:34.146 --> 00:11:35.286 So that's part one. 00:11:35.556 --> 00:11:39.706 Part two is, because of this restructuring, there's gonna be a lot 00:11:39.706 --> 00:11:41.386 of people that are not gonna be covered. 00:11:41.841 --> 00:11:42.951 All right, for insurance. 00:11:42.951 --> 00:11:44.991 Now, they're not gonna qualify for Medicaid or they're not 00:11:44.991 --> 00:11:46.521 gonna be able to afford Medicaid. 00:11:46.771 --> 00:11:49.141 a lot of this has to goes with the providers and how 00:11:49.141 --> 00:11:50.221 they're getting reimbursed. 00:11:50.491 --> 00:11:53.241 The long story short is, the insurance companies are already 00:11:53.241 --> 00:11:56.911 trying to price, for next year what this is going to, what, what this is 00:11:56.911 --> 00:11:58.821 going to affect as far as premiums. 00:11:59.606 --> 00:12:02.666 We just, got our bill basically for what next year's gonna be, 00:12:02.666 --> 00:12:06.416 and they're anticipating about 11% increase from last year. 00:12:06.606 --> 00:12:10.226 if you look at the, if you look at the, the private market or the 00:12:10.226 --> 00:12:14.826 affordable care market, they're talking anywhere between like 15 to 35%. 00:12:14.871 --> 00:12:16.851 Premium increases in health insurance. 00:12:16.881 --> 00:12:18.021 So this affects everyone. 00:12:18.201 --> 00:12:19.281 This is gonna affect everyone. 00:12:19.281 --> 00:12:24.591 So if you, working for an FD or a municipal, government or a fire production 00:12:24.591 --> 00:12:28.101 district, any of that stuff, like I can guarantee you next year that the 00:12:28.101 --> 00:12:30.171 insurance premiums are going to go up. 00:12:30.351 --> 00:12:33.291 It's just a matter of how much and that hits everyone's bottom line. 00:12:33.451 --> 00:12:34.951 that hits the department's bottom line. 00:12:34.951 --> 00:12:37.411 That hits you as a, as a firefighter's bottom line. 00:12:37.411 --> 00:12:38.221 So that's a big one. 00:12:38.221 --> 00:12:42.061 And I just wanted to put that out there so there's not like the silver bullet. 00:12:42.381 --> 00:12:44.541 This is not just all puppies and rainbows. 00:12:44.781 --> 00:12:47.491 There's gonna be some things that we're gonna have to work through in, 00:12:47.491 --> 00:12:51.331 in order to, in order to cover some of these costs, for, having some of 00:12:51.331 --> 00:12:53.491 these long-term, tax reductions, right? 00:12:53.971 --> 00:12:57.901 So on top of that, there's a whole host of other things, but that is really the 00:12:57.901 --> 00:13:02.396 one I think is most pertinent, for our listeners to just consider and just. 00:13:02.671 --> 00:13:06.511 Kind of, have in the back of your mind, if you're looking at budgets for next 00:13:06.511 --> 00:13:10.541 year or if you're negotiating or whatever that looks like, moving forward, that's 00:13:10.541 --> 00:13:13.871 definitely something that's gonna, that's gonna affect your negotiations. 00:13:13.951 --> 00:13:17.451 Alright, so let's talk about now, really. 00:13:17.821 --> 00:13:22.681 The big benefit though, like I said, that you're gonna receive as a firefighter or 00:13:22.681 --> 00:13:26.731 if your spouse works or anyone else's, is basically when they made this one 00:13:26.731 --> 00:13:31.801 big, beautiful bill is they had made the 2017 tax cuts, the Trump tax cuts 00:13:31.801 --> 00:13:35.851 originally, they've made those permanent because they were getting ready to sunset. 00:13:36.121 --> 00:13:37.231 At the end of this year. 00:13:37.591 --> 00:13:41.281 Alright, so that was, causing a whole lot of volatility in the stock market. 00:13:41.281 --> 00:13:43.651 a lot of financial planners and advisors were trying to figure out 00:13:43.651 --> 00:13:47.571 how to, forecast this or do some risk management in order to, if they, 00:13:47.571 --> 00:13:49.821 they reset back to what was before. 00:13:49.821 --> 00:13:53.451 But now we know moving forward that these tax cuts are permanent. 00:13:53.451 --> 00:13:58.371 So those tax brackets, those percentages are gonna be permanent as of as of, 00:13:58.471 --> 00:14:00.871 July 4th is when they signed this in. 00:14:00.871 --> 00:14:04.521 But most of this stuff retros back to January 1st of this year. 00:14:04.581 --> 00:14:04.791 Yeah. 00:14:04.876 --> 00:14:07.996 Louie: And so John, it kind of, it seems like almost a long time. 00:14:07.996 --> 00:14:10.726 It was such a long time ago because this was Trump's first term in office. 00:14:10.726 --> 00:14:12.621 He had this tax cut and part of that was to. 00:14:13.311 --> 00:14:15.326 Lower tax rates, right. 00:14:15.326 --> 00:14:17.906 Dur in, in each of the tax brackets, or at least most of 'em. 00:14:17.906 --> 00:14:19.736 I shouldn't say all of them, but in most of them. 00:14:20.136 --> 00:14:23.676 and then he also raised a significant amount in the standard deduction. 00:14:23.676 --> 00:14:28.836 So much so that, I mean, even many people who were itemizing now didn't 00:14:28.836 --> 00:14:31.596 make sense to, and instead they were, it was more beneficial for 00:14:31.626 --> 00:14:33.216 them to take the standard deduction. 00:14:33.516 --> 00:14:34.146 So those. 00:14:34.666 --> 00:14:40.816 Those tax cuts, those rates are permanent now, and the increased higher 00:14:41.026 --> 00:14:43.696 standard deduction is also permanent. 00:14:43.846 --> 00:14:44.866 Jon: Yeah, exactly. 00:14:44.866 --> 00:14:49.366 So that's, most people now, I can't, I was meaning to look up at the IRS, at least 00:14:49.366 --> 00:14:54.196 for last year, but I think it's upwards of like 90% of tax filers now pretty 00:14:54.196 --> 00:14:58.126 much all claim the standard deduction and they no longer have to itemize. 00:14:58.126 --> 00:14:59.896 So if you're doing your taxes, you're thinking about doing 00:14:59.896 --> 00:15:01.156 your taxes for next year. 00:15:01.426 --> 00:15:04.306 most of you are probably on board with that and I'm, and I'm willing to go 00:15:04.306 --> 00:15:07.966 out on a limb and say the majority of our members do the standard deduction. 00:15:07.966 --> 00:15:11.726 So for this year, they've act, and this will be inflation adjusted. 00:15:11.816 --> 00:15:12.176 Alright? 00:15:12.176 --> 00:15:16.286 But for this year, if you're single, it's gonna be 15,750. 00:15:16.616 --> 00:15:18.116 It's gonna be the standard deduction. 00:15:18.116 --> 00:15:20.976 And if you're married, so if you file jointly, it's gonna 00:15:20.976 --> 00:15:23.676 be $31,500, which is a lot of 00:15:23.811 --> 00:15:25.516 Louie: a lot of money for a standard deduction. 00:15:25.526 --> 00:15:26.426 Jon: That's a lot of money. 00:15:26.676 --> 00:15:30.066 the other thing, that this bill did is, and this is once again, this 00:15:30.066 --> 00:15:32.256 is for a finite amount of time. 00:15:32.506 --> 00:15:34.906 it's gonna be effective starting this year, and I think it goes 00:15:34.906 --> 00:15:37.426 through 2028, if I'm not mistaken. 00:15:37.606 --> 00:15:39.586 Is there going to have an increase in. 00:15:39.636 --> 00:15:42.006 Basically what they're calling a senior deduction. 00:15:42.366 --> 00:15:46.536 All right, so once again, I know we do have some listeners that are retired 00:15:46.536 --> 00:15:49.116 and they are, over the age of 65. 00:15:49.396 --> 00:15:51.076 so you guys are gonna get a little bonus. 00:15:51.481 --> 00:15:53.731 Louie: The, the boomers have struggled so bad. 00:15:53.731 --> 00:15:55.171 I'm glad that they get something 00:15:55.486 --> 00:15:57.016 Jon: They're, they got, they got their, 00:15:57.181 --> 00:16:00.031 Louie: The wealthiest generation in history gets a little tax break. 00:16:00.031 --> 00:16:00.781 Extra tax break. 00:16:00.781 --> 00:16:01.501 Really happy for you 00:16:01.781 --> 00:16:03.341 Jon: Yeah, I could see that on your face. 00:16:03.341 --> 00:16:03.641 Yeah. 00:16:03.641 --> 00:16:08.331 So if you, if you're 65 and over, once again, Christmas is coming early. 00:16:08.391 --> 00:16:09.171 Let it rip. 00:16:09.331 --> 00:16:10.111 live it up a little 00:16:10.396 --> 00:16:10.696 Louie: man. 00:16:10.696 --> 00:16:11.626 The rich get richer. 00:16:11.641 --> 00:16:16.251 Jon: You guys are all going to get, a long, as long as you qualify. 00:16:16.476 --> 00:16:21.486 for, the phase outs for this, you're gonna get an extra $6,000 deductions. 00:16:21.706 --> 00:16:26.046 so what that is, if you're single, if you make, less than $75,000, you'll 00:16:26.046 --> 00:16:27.896 qualify, without getting phased out. 00:16:28.136 --> 00:16:30.916 And if you're married, if you claim $150,000. 00:16:30.981 --> 00:16:33.291 Or less of income, you're gonna qualify for this. 00:16:33.291 --> 00:16:37.551 So potentially, you think about this 31,500 standard deduction. 00:16:37.971 --> 00:16:41.671 Plus, if you and your spouse, so you're filing, married, you're 00:16:41.671 --> 00:16:45.691 filing jointly, you're both gonna get an additional $6,000. 00:16:45.751 --> 00:16:52.681 So $12,000 on top of the 31,500, that is a crap ton of a standard deduction. 00:16:53.641 --> 00:16:55.351 What do you, what do you have to say about that, Louis? 00:16:55.916 --> 00:16:56.786 Louie: Good for you guys. 00:16:56.786 --> 00:16:57.596 I mean, good for you. 00:16:57.596 --> 00:17:01.076 That's if you, if you have the deduction, obviously take it, use it. 00:17:01.626 --> 00:17:02.466 it's a big benefit. 00:17:02.526 --> 00:17:05.436 I mean, that, that is, that's a huge benefit. 00:17:05.436 --> 00:17:08.376 But even if you're not a senior, and even if you're not that much and 00:17:08.376 --> 00:17:11.136 you're married, let's say you're a young married couple and you have 00:17:11.136 --> 00:17:15.696 a $31,500 base standard deduction, I mean, that's a, that's huge. 00:17:15.696 --> 00:17:16.836 Like, that's, that's great. 00:17:17.466 --> 00:17:19.061 And with the lower tax rates, John, I think. 00:17:19.761 --> 00:17:23.901 Maybe now is the appropriate time to talk about our, one of our favorite retirement 00:17:23.901 --> 00:17:27.471 accounts, or one of our favorite ways to contribute to retirement accounts. 00:17:27.891 --> 00:17:30.531 And that's through the Roth option, right? 00:17:31.011 --> 00:17:35.911 So the Roth option, just a little quick, reminder for you guys, the, the 00:17:35.911 --> 00:17:40.921 Roth contribution, whether it's to a 4 57 or to an IRA, means that you pay 00:17:40.921 --> 00:17:43.111 post-tax, you pay taxes on the money. 00:17:43.111 --> 00:17:46.206 Now you put it into a Roth account, and then that money. 00:17:46.621 --> 00:17:51.151 Grows and is spent tax free because you've already paid taxes on it. 00:17:51.571 --> 00:17:54.511 John and I have both mentioned in previous episodes that that's like 00:17:54.511 --> 00:17:58.501 our favorite account and we think most people should contribute to, their 00:17:58.501 --> 00:18:00.331 retirement accounts on a Roth basis. 00:18:00.751 --> 00:18:05.611 So I would say that if you look at, there's just, if you look at the history 00:18:05.611 --> 00:18:09.091 of tax rates in the United States, or at least in the last a hundred years, 00:18:09.091 --> 00:18:11.791 we are at historic lows for tax rates. 00:18:12.121 --> 00:18:13.291 They don't get lower than this. 00:18:13.381 --> 00:18:14.041 These are like. 00:18:14.686 --> 00:18:16.666 Bargain basement prices here. 00:18:17.086 --> 00:18:20.536 So if you can lock in that, those low tax rates of what 00:18:20.536 --> 00:18:22.696 you're paying, that is wonderful. 00:18:22.726 --> 00:18:24.316 That is amazing, right. 00:18:25.196 --> 00:18:28.436 John, I know you kind of had this maybe planned to talk about a little bit later, 00:18:28.436 --> 00:18:35.126 but there's massive deficits that this bill as every other bill runs, so I 00:18:35.126 --> 00:18:36.776 think it's a reasonable expectation to. 00:18:37.376 --> 00:18:41.336 Assume that tax rates eventually are going to increase, right? 00:18:41.816 --> 00:18:46.386 Jon: Yeah, I mean they're saying, conservatively, they're saying about 3.4 00:18:46.386 --> 00:18:50.826 trillion is what this is gonna add to the deficit over the next, 10 years. 00:18:51.346 --> 00:18:51.646 yeah. 00:18:51.916 --> 00:18:54.826 On top of already trillions and trillions and trillions. 00:18:54.826 --> 00:18:58.506 So at some point, with every great empire, they're eventually you gotta 00:18:58.506 --> 00:19:01.476 pay the piper and someone's gonna have to pay the piper and it's gonna be us 00:19:01.476 --> 00:19:03.066 and our, our kids that will end up. 00:19:03.396 --> 00:19:04.896 Paying for all these cuts. 00:19:04.896 --> 00:19:04.956 Yeah. 00:19:05.346 --> 00:19:09.516 But yeah, I mean, I think, and you talk to most, tax professionals, most advisors, 00:19:09.516 --> 00:19:13.516 most planners, you know, looking, we don't have a crystal ball, but you look 00:19:13.516 --> 00:19:15.736 5, 10, 15, 20 years into the future. 00:19:15.736 --> 00:19:20.026 And we just have to figure at some point we can't grow our way out of this, that we 00:19:20.026 --> 00:19:21.736 are eventually gonna have to pay for this. 00:19:22.016 --> 00:19:25.046 and I think that at some point is just gonna revert back to previous 00:19:25.046 --> 00:19:28.216 tax brackets and rates where, it's gonna be very common if you're in the. 00:19:28.361 --> 00:19:31.661 Or upper echelon, it's gonna be upwards of 40% or maybe more. 00:19:31.661 --> 00:19:36.131 And just even for middle income earners, it's gonna be higher than the 22 or 00:19:36.131 --> 00:19:38.301 24 4% that you're doing right now. 00:19:38.301 --> 00:19:41.541 So you never say always, and you never say never. 00:19:41.571 --> 00:19:46.431 most people, I would say, if you're in that 24 under bracket, boy, you'd really 00:19:46.436 --> 00:19:50.271 have to convince me why a Roth account would not be in your best interest. 00:19:50.271 --> 00:19:50.871 Honestly. 00:19:51.211 --> 00:19:51.391 it 00:19:51.396 --> 00:19:51.696 Louie: is. 00:19:51.696 --> 00:19:54.276 I mean, I, I'm just gonna say it has to be, it has to be. 00:19:54.276 --> 00:19:55.716 'cause these, it's not gonna go lower. 00:19:55.716 --> 00:19:57.006 Tax rates are not gonna go lower. 00:19:57.666 --> 00:19:58.566 They're only gonna go higher. 00:19:58.841 --> 00:20:01.031 Jon: That's, that is what the consensus is. 00:20:01.031 --> 00:20:04.121 If you listen to a lot of people that do this for a living, and they've been in 00:20:04.121 --> 00:20:07.931 the industry for a long time, and they can just do basic math and arithmetic. 00:20:07.931 --> 00:20:11.111 You extrapolate this out over time and it's just gonna get 00:20:11.111 --> 00:20:12.341 worse before it gets better. 00:20:12.611 --> 00:20:15.086 Louie: I don't, I don't know if you've noticed this, but I, you know, 00:20:15.506 --> 00:20:17.516 well, you and I have talked about all the podcasts that I listen to. 00:20:17.516 --> 00:20:19.466 I listen to so many nerdy financial Oh yeah. 00:20:19.496 --> 00:20:20.126 Podcasts. 00:20:20.126 --> 00:20:20.576 Love it. 00:20:21.146 --> 00:20:26.626 But I can see, a very distinct change in a lot of these financial. 00:20:26.921 --> 00:20:31.341 Podcast hosts and experts, versus what they talked about 10 years ago. 00:20:31.341 --> 00:20:34.701 So 10 years ago, 15 years ago, when I was really listening to a lot of 00:20:34.701 --> 00:20:37.851 these people in the fire movement, financial independence, retire early. 00:20:38.421 --> 00:20:41.061 There was this huge belief that you should make all your 00:20:41.061 --> 00:20:43.491 contributions on a pre-tax basis. 00:20:43.561 --> 00:20:47.341 because they thought when you retire, you'll be making less money. 00:20:47.341 --> 00:20:51.431 There's strategies for doing conversions and stuff like that to, kind of. 00:20:52.016 --> 00:20:56.096 minimize the amount of taxes you pay, so defer those taxes as long as possible. 00:20:56.096 --> 00:20:57.476 That was like the conventional wisdom mm-hmm. 00:20:57.716 --> 00:21:00.086 From all these people is like, keep deferring, do 00:21:00.086 --> 00:21:01.826 pre-tax, don't, don't do Roth. 00:21:02.456 --> 00:21:04.316 and now I've seen it all change. 00:21:04.346 --> 00:21:07.586 Almost, almost all the podcasts that I listened to, all the financial 00:21:07.586 --> 00:21:10.556 quote unquote experts that I listened to have now been like, 00:21:10.646 --> 00:21:13.346 Hey, it has nowhere to go but up. 00:21:13.346 --> 00:21:14.966 You should probably do Roth accounts. 00:21:14.966 --> 00:21:16.106 And they've all come over to that. 00:21:16.106 --> 00:21:17.846 Basically now they all advocate. 00:21:18.221 --> 00:21:19.661 Contributing to Roth accounts. 00:21:19.661 --> 00:21:20.051 Yeah, 00:21:21.401 --> 00:21:21.671 Jon: yeah. 00:21:21.671 --> 00:21:24.281 No, that's definitely, I think that's very common. 00:21:24.341 --> 00:21:27.281 consensus once again, and once again, it depends on where you're at. 00:21:27.551 --> 00:21:30.941 But what they are finding as well is they're finding a lot of people 00:21:30.941 --> 00:21:35.111 that, since these plans, since the 401k was developed, you know a lot 00:21:35.111 --> 00:21:36.791 of these baby boomers that you. 00:21:36.811 --> 00:21:37.891 Love so much. 00:21:37.921 --> 00:21:43.161 they're sitting on, two to four to $10 million in deferred accounts. 00:21:43.731 --> 00:21:47.271 And now the time has come where they can't defer it anymore and 00:21:47.271 --> 00:21:48.831 they have to start taking money out. 00:21:48.891 --> 00:21:49.341 Which is, 00:21:49.411 --> 00:21:50.491 Louie: minimum distributions. 00:21:50.691 --> 00:21:52.791 Jon: MDs required minimum distributions. 00:21:52.791 --> 00:21:56.151 And they're just having huge, what they're calling ticking time bombs. 00:21:56.181 --> 00:21:58.166 'cause they gotta take out all this money now and they're getting. 00:21:58.511 --> 00:22:03.461 Taxed on this, and they're, it's putting 'em into the 32 and 37% tax bracket. 00:22:03.461 --> 00:22:07.811 So there's a lot of different strategies with this, but once again, 00:22:07.841 --> 00:22:11.181 for the younger folks and even those that are not that young, think about 00:22:11.181 --> 00:22:12.591 where you are in your tax bracket. 00:22:12.591 --> 00:22:16.071 And I would really be willing to say that the majority of our members 00:22:16.371 --> 00:22:19.761 would be better suited for Roth accounts versus pre-tax accounts. 00:22:19.761 --> 00:22:23.481 Now every situation is different, so this is not tax advice and this is not 00:22:23.481 --> 00:22:25.491 financial advice, just generally speaking. 00:22:25.881 --> 00:22:27.316 Just consider that and, and. 00:22:27.696 --> 00:22:30.546 The long term, and it's kind of know that this is what you pay right 00:22:30.546 --> 00:22:33.426 now, but now you let it grow tax free and then you can take it out, 00:22:33.706 --> 00:22:35.176 without any taxes, which is great. 00:22:35.326 --> 00:22:37.126 It's good, it's good to have diversification. 00:22:37.156 --> 00:22:37.666 So have a little 00:22:37.686 --> 00:22:38.256 Louie: bit of everything. 00:22:38.286 --> 00:22:38.466 Yep. 00:22:38.646 --> 00:22:39.006 There you go. 00:22:39.256 --> 00:22:39.466 Jon: There you go. 00:22:39.466 --> 00:22:40.816 So that's standard deduction. 00:22:40.866 --> 00:22:44.046 the other thing is, and this might apply to actually quite a few of our 00:22:44.046 --> 00:22:46.756 members too, is the salt deduction. 00:22:46.846 --> 00:22:52.456 All right, so this is part of the, the TCA 2017, taxes that originally 00:22:52.456 --> 00:22:53.416 happened as they capped it. 00:22:53.701 --> 00:22:55.381 At $10,000, right? 00:22:55.561 --> 00:22:59.791 So that is the amount that you could deduct for, state taxes, for property 00:22:59.791 --> 00:23:03.086 taxes, all the things that you pay to your state and local government basically. 00:23:03.201 --> 00:23:04.851 Louie: that's the state and local tax 00:23:05.331 --> 00:23:06.861 Jon: That's what SALT stands for. 00:23:06.931 --> 00:23:08.791 so that was capped at $10,000. 00:23:09.181 --> 00:23:12.421 Well, with the new legislation, and once again, this is not permanent, 00:23:12.421 --> 00:23:17.101 this will also get phased out, but that has been increased to $40,000. 00:23:17.521 --> 00:23:20.581 So once again, if you're paying a lot of state tax or you, 00:23:20.631 --> 00:23:21.831 live in a, a place at the. 00:23:21.846 --> 00:23:24.846 The property taxes have gone up exorbitantly, which a lot 00:23:24.846 --> 00:23:25.896 of places around here is. 00:23:26.176 --> 00:23:30.586 this might be something that, you know, might make sense to start to itemize 00:23:30.586 --> 00:23:32.966 again versus, do the standard deduction. 00:23:32.966 --> 00:23:35.666 But once again, this is a very personal decision. 00:23:35.916 --> 00:23:37.506 it's really gonna depend on what your. 00:23:37.506 --> 00:23:40.716 What your tax liability and stuff like that looks like for, for next year. 00:23:40.716 --> 00:23:44.226 But you know, for some of our folks, you always mention your friends that have, 00:23:44.256 --> 00:23:47.506 PAs and physicians, shout out to you guys. 00:23:47.536 --> 00:23:51.986 you might be better suited potentially, to do the itemized deductions. 00:23:52.046 --> 00:23:55.516 And because of this increase in, the salt cap basically being 00:23:55.516 --> 00:23:58.456 increased from 10 K to 40 k now. 00:23:59.806 --> 00:24:03.446 All right, so this is the one, that we definitely wanted to highlight. 00:24:03.506 --> 00:24:04.016 All right. 00:24:04.016 --> 00:24:06.296 And almost everyone at some point. 00:24:06.296 --> 00:24:09.806 I don't think I've gone a day or two with someone asking me b about this. 00:24:09.806 --> 00:24:12.596 No tax on tips, no tax on overtime stuff. 00:24:12.596 --> 00:24:14.196 So, this is good. 00:24:14.226 --> 00:24:16.906 This will benefit our members, for sure. 00:24:16.906 --> 00:24:21.616 But we definitely, there's some caveats with this, and it's not it, I mean, it's 00:24:21.616 --> 00:24:25.216 good, but it's not as great as I think most of our members think it's gonna be. 00:24:25.246 --> 00:24:25.516 Yeah, we've 00:24:25.516 --> 00:24:28.906 Louie: And we've waited, I, I don't know, I you probably in a similar boat, 00:24:28.906 --> 00:24:32.086 but when the bill was first proposed and even when it was first passed, I got 00:24:32.146 --> 00:24:35.776 got questions and I just kind of told people, hold on, like let us look into it. 00:24:35.806 --> 00:24:38.746 Let kind of think, let the dust settle and some analysis to come 00:24:38.746 --> 00:24:39.976 out before we talk about it. 00:24:40.256 --> 00:24:42.806 just 'cause there was a lot of confusion and like, it's even 00:24:42.806 --> 00:24:44.666 misnamed really in the bill itself. 00:24:44.666 --> 00:24:44.756 Yes. 00:24:44.756 --> 00:24:46.346 So I think we'll address. 00:24:46.561 --> 00:24:50.081 that now, knowing that it could still change and it could still be different 00:24:50.081 --> 00:24:53.441 than what we think, but it seems like it's now congealed enough to the point 00:24:53.441 --> 00:24:54.551 where we're comfortable talking with it. 00:24:54.551 --> 00:24:57.041 Yeah, so we'll do the overtime deduction first. 00:24:57.041 --> 00:25:00.701 There's a provision in the bill called no tax on overtime or the 00:25:00.701 --> 00:25:04.421 no tax on overtime deduction, and that's really misnamed because you 00:25:04.421 --> 00:25:06.611 still will pay some tax on overtime. 00:25:07.121 --> 00:25:13.091 However, the way it works is the premium portion of overtime pay is now. 00:25:13.816 --> 00:25:14.896 Tax deductible. 00:25:15.316 --> 00:25:19.846 So what that really means is the half in time and a half is what's deductible. 00:25:20.416 --> 00:25:27.096 So that deduction, is limited to $12,500 per year for a single filer and a 00:25:27.096 --> 00:25:30.036 $25,000 deduction for a joint filer. 00:25:30.546 --> 00:25:32.196 And that there's phase outs for that. 00:25:32.196 --> 00:25:34.836 Like if you're modified, adjusted, gross is over. 00:25:35.391 --> 00:25:38.751 $300,000 for a married couple, you'll start experience a phase out 00:25:38.751 --> 00:25:40.201 where, it's even less than that. 00:25:40.531 --> 00:25:43.141 But lemme give you an example, John, because I feel like this is the best 00:25:43.141 --> 00:25:45.331 way to, to make sense of all that. 00:25:45.811 --> 00:25:47.131 Just word Yeah. 00:25:47.251 --> 00:25:48.871 Alphabet soup that I just threw out there. 00:25:49.441 --> 00:25:55.321 So let's say your regular rate, your regular hourly pay rate is $40 an 00:25:55.321 --> 00:25:59.281 hour and you work in overtime, you get paid a time and a half, which 00:25:59.281 --> 00:26:00.961 means you would get paid $60 an hour. 00:26:02.281 --> 00:26:05.101 While that extra $20 an hour is your premium. 00:26:05.911 --> 00:26:10.921 That's the premium portion of your overtime and that is what is deductible. 00:26:11.641 --> 00:26:14.481 So John, we have an example here that we think kind of 00:26:14.481 --> 00:26:15.681 drives it home for firefighters. 00:26:16.011 --> 00:26:21.251 If you're a first grade firefighter with 10 years, your shift hourly wage is 41 64. 00:26:22.091 --> 00:26:24.366 Your overtime rate when you work at your time and a. 00:26:24.916 --> 00:26:26.656 Is 62 46. 00:26:26.776 --> 00:26:30.736 So the premium pay of that would be $20 and 82 cents. 00:26:30.886 --> 00:26:33.316 And that's the amount that's tax tax deductible. 00:26:33.376 --> 00:26:38.386 So in order to max out the max of 12,500, this firefighter would have 00:26:38.386 --> 00:26:42.646 to work 600 hours or 25 shifts, 00:26:42.791 --> 00:26:48.761 Jon: 25, 24 hour shifts in order just to meet that threshold for the 12,500. 00:26:48.761 --> 00:26:51.761 So if you're just single, so if you were one of these people that were 00:26:51.761 --> 00:26:55.721 really trying to break records, right, and work as much godly over time as 00:26:55.721 --> 00:26:58.991 you could, so you wanted to max out and you're married, so you could go 00:26:58.991 --> 00:27:05.441 the full $25,000 deduction, you're talking 1200 hours of OT or 50. 00:27:05.511 --> 00:27:06.951 24 hour shifts. 00:27:07.011 --> 00:27:10.011 And the thing is, and I hope you guys appreciate this, it's a 00:27:10.011 --> 00:27:14.541 deduction so you don't get this offset until you file your taxes. 00:27:14.691 --> 00:27:17.421 It will reduce your tax liability the following year. 00:27:17.421 --> 00:27:21.711 So you're still gonna be taxed on that originally with your pay stub. 00:27:21.711 --> 00:27:23.991 So it's not like you're gonna just get this free money right out of the chute. 00:27:24.201 --> 00:27:26.661 You're gonna have to defer that until you actually file 00:27:26.661 --> 00:27:28.341 your taxes the following year. 00:27:28.391 --> 00:27:28.871 Right. 00:27:29.241 --> 00:27:32.871 by April 15th or whatever it is for next year, whatever that Monday that it falls 00:27:32.871 --> 00:27:34.431 on, that's what you're gonna have to do. 00:27:34.431 --> 00:27:37.431 So it's not this instant thing that you're gonna see right away for one. 00:27:37.491 --> 00:27:40.071 And then when you start actually putting into like, man, how 00:27:40.071 --> 00:27:41.421 much is this really gonna take? 00:27:41.701 --> 00:27:45.721 I think about people that do like the wildland deployments or FEMA deployments 00:27:45.721 --> 00:27:50.091 where they're getting, big chunks, six, $8,000 paydays or overtime for that. 00:27:50.091 --> 00:27:53.811 Like, I, I think this is really where it's gonna be well suited for those of you 00:27:53.811 --> 00:27:56.121 that work an occasional 24 here and there. 00:27:56.436 --> 00:27:59.046 Now you're obviously gonna see a little bit of savings, but it's, 00:27:59.046 --> 00:28:01.266 you can't go buy that new truck. 00:28:01.476 --> 00:28:04.146 You can't buy that new house on this deduction. 00:28:04.146 --> 00:28:07.626 It, it definitely will help and don't look a gift worth in the mouth 00:28:07.626 --> 00:28:10.506 kind of thing, but it's not gonna be something that's gonna reset 00:28:10.506 --> 00:28:11.886 the needle on a lot of this stuff. 00:28:11.931 --> 00:28:12.201 Louie: Yeah. 00:28:12.201 --> 00:28:14.901 I think a lot of people were like, oh man, no tax on overtime, so I'm gonna work a 00:28:14.901 --> 00:28:16.491 bunch of shifts and I'm gonna get paid. 00:28:16.626 --> 00:28:19.796 Jon: They thought they were gonna work their $1,500, overtime shift 00:28:19.796 --> 00:28:23.606 and clear $1,500 and that is just not the way that this is gonna 00:28:23.621 --> 00:28:24.551 Louie: work not even close. 00:28:24.561 --> 00:28:28.691 Jon: So, so as far as how this is gonna work, at least for this year, I believe 00:28:28.691 --> 00:28:34.331 that the IRS, it's basically going to be on the taxpayer to prove that you 00:28:34.331 --> 00:28:38.381 had this overtime, because it's not really gonna be segmented out in our, 00:28:38.381 --> 00:28:42.181 in our, Payroll software and a DP is not gonna segregate all the stuff out. 00:28:42.181 --> 00:28:46.201 I think in the following year it will, but basically you're just going to have to 00:28:46.201 --> 00:28:48.811 claim that this is what the overtime was. 00:28:49.031 --> 00:28:51.331 and then, if you do get audited, you're just gonna have to 00:28:51.331 --> 00:28:52.711 prove how you got to these. 00:28:52.931 --> 00:28:53.996 Louie: how you calculated the premium. 00:28:54.156 --> 00:28:54.276 I 00:28:54.561 --> 00:28:55.761 Jon: the premium and all this other stuff. 00:28:55.761 --> 00:28:59.871 I think moving forward next year and so forth, this will be a little bit clearer. 00:28:59.871 --> 00:29:03.161 But as far as the payroll software right now, they will not do that. 00:29:03.191 --> 00:29:06.221 at least from, the higher ups that I've talked to, said that 00:29:06.221 --> 00:29:07.931 that will not be for 2025. 00:29:07.931 --> 00:29:10.631 It will start in 2026, but this is effective. 00:29:10.921 --> 00:29:12.961 Starting January 1st, 2025. 00:29:12.961 --> 00:29:16.261 So if you've worked any overtime this year, there will be a certain 00:29:16.261 --> 00:29:20.111 portion of that premium pay, that will be deductible when you file your 00:29:20.761 --> 00:29:23.671 Louie: And there's a few firefighters who are gonna get close to that 600 hours. 00:29:23.671 --> 00:29:26.641 Man, I feel like we always have a few firefighters that are close to that. 00:29:26.641 --> 00:29:30.811 I know Dan Schultz, man from my academy, works a ton of overtime and he's 00:29:30.811 --> 00:29:34.801 always pushing, he's almost, almost always leading the list or close to it. 00:29:34.801 --> 00:29:37.291 So he might get that full deduction. 00:29:37.331 --> 00:29:38.951 Jon: There might be some full deductions. 00:29:39.011 --> 00:29:39.521 All right. 00:29:39.771 --> 00:29:42.801 so now this is probably the second crowd favorite. 00:29:42.851 --> 00:29:46.901 and they're going to, we just had our dead episode last go around Louis. 00:29:46.901 --> 00:29:50.111 So we're gonna parlay this right on top of that one. 00:29:50.201 --> 00:29:54.571 And, now we've got, thanks to the, one big beautiful bill act, 00:29:54.621 --> 00:29:56.601 no tax on car loan interests. 00:29:57.086 --> 00:29:57.686 All right, 00:29:57.696 --> 00:29:59.166 Louie: But no one has car loans anymore. 00:29:59.166 --> 00:30:01.116 'cause they listen to the fiscal firehouse. 00:30:01.116 --> 00:30:02.736 They want to be financially responsible 00:30:02.816 --> 00:30:04.046 Jon: They're getting a good deal, man. 00:30:04.046 --> 00:30:05.516 Someone's got a sweet deal. 00:30:05.756 --> 00:30:05.846 You 00:30:06.006 --> 00:30:06.876 Louie: about the good deals. 00:30:07.001 --> 00:30:10.121 Jon: I mean, it's basically costing you money by not getting a new truck. 00:30:10.121 --> 00:30:10.301 Of course. 00:30:10.721 --> 00:30:14.261 All right, so what are, what are some of the caveats with this one lb? 00:30:14.291 --> 00:30:15.941 Is it as good as it sounds, or? 00:30:16.316 --> 00:30:16.616 Louie: Yeah. 00:30:16.616 --> 00:30:19.406 Well, once again, as most things from the federal government, 00:30:19.646 --> 00:30:21.296 it's not as good as it sounds. 00:30:21.326 --> 00:30:21.356 Okay. 00:30:21.476 --> 00:30:23.696 But there is still a, a, a deduction. 00:30:23.846 --> 00:30:26.846 Once again, it's called no Tax on Car Loan Interest. 00:30:26.846 --> 00:30:28.346 That's the name of the provision in the bill. 00:30:28.916 --> 00:30:31.436 And there's some very specific things that you have to do to 00:30:31.436 --> 00:30:33.206 qualify or that, that have to be the. 00:30:33.636 --> 00:30:36.006 The situation in order for you to qualify. 00:30:36.006 --> 00:30:40.026 So interest paid to recruit on a loan to purchase a qualified passenger 00:30:40.026 --> 00:30:46.086 vehicle for personal use after 2024 is basically saying it has to be a new car. 00:30:46.086 --> 00:30:47.076 This has to be a new car. 00:30:47.076 --> 00:30:48.306 It can't be on a used car. 00:30:48.886 --> 00:30:49.756 and the vehicle. 00:30:50.321 --> 00:30:52.241 it has to be assembled in the United States. 00:30:52.271 --> 00:30:54.641 So I think there's a way to figure that out. 00:30:54.641 --> 00:30:59.351 It's like if your VIN number starts with a one, a four or a five, I believe. 00:30:59.351 --> 00:31:01.931 Okay, it's either 1, 4, 5, or 1 5 6. 00:31:02.271 --> 00:31:05.511 if you're, if it starts with any of those three numbers, then that's how 00:31:05.511 --> 00:31:07.221 you know it's been assembled in the us. 00:31:07.766 --> 00:31:09.146 So it has to meet that to 00:31:09.186 --> 00:31:09.546 Jon: qualify. 00:31:09.546 --> 00:31:11.946 And the car dealers are gonna advertise the crap out of this. 00:31:11.946 --> 00:31:15.516 Oh, they're gonna advertise like, Hey man, you basically, you get up to this much. 00:31:15.516 --> 00:31:18.536 So, and they will, they will take this, from a marketing 00:31:18.536 --> 00:31:21.986 strategy standpoint, and they will highlight this to the nth degree. 00:31:21.986 --> 00:31:23.216 I can guarantee you that. 00:31:23.261 --> 00:31:23.531 Louie: Mm-hmm. 00:31:24.011 --> 00:31:24.911 Yeah, exactly. 00:31:25.241 --> 00:31:29.861 And, and the, so if your car meets those qualifications, you can 00:31:29.861 --> 00:31:33.341 deduct up to $10,000 per year. 00:31:33.771 --> 00:31:35.991 and that's an above the line deduction is what it's called. 00:31:36.481 --> 00:31:40.471 and then there's phase outs that are still relevant, similar phase outs, 150,000 00:31:40.471 --> 00:31:43.186 for a single person, $300,000 for, which 00:31:43.186 --> 00:31:45.991 Jon: a very common theme that you'll see, or a common thread that 00:31:45.991 --> 00:31:50.461 you'll see that that one 50 k for single and 300 k for married apply 00:31:50.461 --> 00:31:52.221 to a lot of these, deductions. 00:31:52.401 --> 00:31:52.671 Yeah, to 00:31:52.686 --> 00:31:53.556 Louie: That makes things easy. 00:31:53.616 --> 00:31:56.406 And the good news on it is that you can claim this deduction 00:31:56.406 --> 00:31:57.726 whether or not you itemize. 00:31:57.786 --> 00:32:02.076 So you can take the, the, the, standard deduction that we talked 00:32:02.076 --> 00:32:05.946 about earlier, and you can still also claim this deduction in your. 00:32:06.256 --> 00:32:07.576 Interest paid in this car loan. 00:32:07.821 --> 00:32:08.211 Jon: Yeah. 00:32:08.301 --> 00:32:11.211 So if you ever hear that, if you ever see it written or you hear 00:32:11.211 --> 00:32:15.051 people talk about above the line versus below the line, deductions 00:32:15.531 --> 00:32:17.811 above the line is always the best. 00:32:17.811 --> 00:32:20.601 if you're looking for a deduction or credit or anything else like that, you're 00:32:20.601 --> 00:32:24.261 always, the best ones will always be above the line because you're right. 00:32:24.621 --> 00:32:27.171 Then it doesn't matter whether you itemize or you do the standard 00:32:27.171 --> 00:32:30.986 deduction, little tax tip on that one and how to keep those things straight. 00:32:31.901 --> 00:32:32.861 So I don't know. 00:32:32.911 --> 00:32:34.921 I guess if you were already in the market and you already 00:32:34.921 --> 00:32:37.091 bought one, I guess kudos to you. 00:32:37.121 --> 00:32:41.111 I still don't think this changes my thought process, and what we 00:32:41.111 --> 00:32:42.671 talked about before, car loans 00:32:42.751 --> 00:32:43.741 Louie: doesn't change the math for me. 00:32:44.441 --> 00:32:45.821 Jon: or anything else like this. 00:32:45.901 --> 00:32:49.711 I, I wonder if this is just another one of those incentives that might 00:32:49.711 --> 00:32:54.571 actually be more harmful to our members than beneficial, because 00:32:54.571 --> 00:32:57.331 they're gonna take this and they're gonna fit, they're gonna look at this 00:32:57.331 --> 00:32:59.881 as like a free loan or a 0% loan. 00:33:00.191 --> 00:33:03.131 but they're, the cost of ownership is still gonna be the same. 00:33:03.201 --> 00:33:04.851 your taxes are still gonna be the same. 00:33:04.851 --> 00:33:07.521 Your insurance is still gonna be the same for a new vehicle. 00:33:07.611 --> 00:33:09.561 Registration is still gonna be the same. 00:33:09.561 --> 00:33:10.011 Like, 00:33:10.046 --> 00:33:12.386 Louie: yeah, and, and to be clear, it's not the, the government is 00:33:12.386 --> 00:33:16.226 not paying the, we talked about the price of debt is the interest that 00:33:16.226 --> 00:33:17.876 you pay it and the opportunity cost. 00:33:17.876 --> 00:33:17.936 Yeah. 00:33:18.326 --> 00:33:19.286 It doesn't change that math. 00:33:19.286 --> 00:33:22.706 You're still paying interest to the bank for that loan, and you're still. 00:33:23.481 --> 00:33:25.251 You still have the opportunity cost of what you could be 00:33:25.251 --> 00:33:26.451 doing with that money instead. 00:33:26.481 --> 00:33:29.271 So the, I think for John and I, the math doesn't change. 00:33:29.271 --> 00:33:33.751 We still think, the vicious cycle of car loans every five or seven or eight years 00:33:33.751 --> 00:33:38.131 is a, still a dangerous and unhealthy financial habit for Americans to be in. 00:33:38.386 --> 00:33:38.656 Jon: Yep. 00:33:38.816 --> 00:33:42.026 and the last point with this specific one is you can't double dip. 00:33:42.236 --> 00:33:42.596 All right? 00:33:42.596 --> 00:33:46.406 So if you are using this as a deduction for a business or something else, like. 00:33:46.421 --> 00:33:49.631 That you can't take that business deduction and then also 00:33:49.631 --> 00:33:51.611 take, this deduction as well. 00:33:51.611 --> 00:33:52.211 you can't double 00:33:52.346 --> 00:33:53.006 Louie: Can't double dip. 00:33:53.231 --> 00:33:57.091 Jon: The IRS is, is very creative in how they, do that and make sure that 00:33:57.451 --> 00:33:59.101 taxpayers are not double dipping. 00:33:59.281 --> 00:34:00.631 All right, so that's the big one. 00:34:00.631 --> 00:34:02.871 There's also this one, on tips as well. 00:34:03.411 --> 00:34:07.001 once again, unless you work for a fire department, I want to see your contract, 00:34:07.001 --> 00:34:08.621 but you're allowed to take tips. 00:34:08.691 --> 00:34:11.151 probably shouldn't apply to most folks, but, 00:34:11.221 --> 00:34:13.051 Louie: you haven't been in the back of an ambulance for a while, John. 00:34:13.051 --> 00:34:13.981 We take tips now. 00:34:14.071 --> 00:34:15.391 We just have a little tip jar there. 00:34:15.391 --> 00:34:18.571 We even swing the computer around and they can choose how much they want to 00:34:18.591 --> 00:34:18.711 Jon: tip. 00:34:18.741 --> 00:34:19.731 Oh, 50%, 00:34:19.741 --> 00:34:20.851 Louie: 20 or 25%. 00:34:20.851 --> 00:34:21.271 It's great. 00:34:21.276 --> 00:34:22.531 We make a ton of money that 00:34:22.591 --> 00:34:23.581 Jon: Oh, I love it. 00:34:23.581 --> 00:34:28.371 So if that's the case, you can deduct up to 25,000 of that, per 00:34:28.371 --> 00:34:31.741 income per year for single, filers. 00:34:31.841 --> 00:34:34.631 so, that's, you know, that might actually apply though. 00:34:34.631 --> 00:34:37.241 I do know that, there are some people that do a side hustle. 00:34:37.511 --> 00:34:40.451 There's also people that have, spouses or partners that are 00:34:40.451 --> 00:34:42.881 teachers and they do stuff on the summertime where they might work. 00:34:42.946 --> 00:34:43.816 for tips or whatever. 00:34:43.816 --> 00:34:47.356 So that's not to, say that that's not valuable or couldn't be valuable to 00:34:47.356 --> 00:34:50.876 some of the listeners, but, as far as just the straight firefighting gig, 00:34:50.876 --> 00:34:52.316 that's not really gonna apply to you. 00:34:53.246 --> 00:34:56.576 What I am happy though, that the federal government did somewhat listen 00:34:56.576 --> 00:35:00.896 to the fiscal firehouse, and this is something that we brought up, last year 00:35:00.926 --> 00:35:02.846 and kind of a source of frustration. 00:35:02.936 --> 00:35:05.646 And this has to do with the cost of, dependent care. 00:35:05.706 --> 00:35:06.696 So childcare. 00:35:06.946 --> 00:35:08.746 but we talked, you know, ad nauseum. 00:35:09.426 --> 00:35:13.686 Last year about the dependent care, flexible spending account, your FSAs 00:35:14.106 --> 00:35:17.616 and how it doesn't matter how many kids you have, it doesn't matter. 00:35:17.686 --> 00:35:18.946 how much daycare costs. 00:35:18.946 --> 00:35:21.106 It was capped at $5,000, 00:35:21.121 --> 00:35:22.771 Louie: which had been the same for how many years, 00:35:22.936 --> 00:35:27.166 Jon: I believe it was like 1984 basically, since it would've been instituted. 00:35:27.436 --> 00:35:29.146 So they did throw us a little bone. 00:35:29.206 --> 00:35:29.266 Yeah. 00:35:29.416 --> 00:35:33.026 So starting next year, January 1st, they're gonna up that limit. 00:35:33.341 --> 00:35:39.311 So it's gonna be $7,500 per year now that you can contribute to a dependent 00:35:39.311 --> 00:35:40.961 care, flexible spending account. 00:35:41.146 --> 00:35:41.866 Louie: Long overdue. 00:35:41.951 --> 00:35:44.231 Jon: long overdue, and it's a step in the right direction. 00:35:44.231 --> 00:35:47.291 I would've loved to see them double that, or quite honestly triple that, 00:35:47.291 --> 00:35:50.436 and it still wouldn't be enough, but it is a, a modest increase. 00:35:51.266 --> 00:35:54.986 once again though, you know, in their creative math is everything 00:35:54.986 --> 00:35:55.916 else that we've talked about. 00:35:55.916 --> 00:35:58.886 For the most part, they've indexed for inflation. 00:35:59.126 --> 00:35:59.756 This one. 00:36:00.126 --> 00:36:00.846 solid cap. 00:36:00.966 --> 00:36:02.076 7,500 bucks. 00:36:02.316 --> 00:36:05.496 So in 2027 it's not gonna be 8,000. 00:36:05.496 --> 00:36:05.736 Nope. 00:36:05.766 --> 00:36:07.836 They're gonna just keep this, as is so, 00:36:08.191 --> 00:36:10.921 Louie: well, hey Don, at least Donny boy was listening to the podcast 00:36:10.921 --> 00:36:14.611 because this was, this was kind of, one of your pet peeves that we 00:36:14.611 --> 00:36:15.811 talked, you talked about last year, 00:36:15.946 --> 00:36:19.666 Jon: a big frustration for me, so it is a step in the right direction. 00:36:19.786 --> 00:36:22.546 All right, so just as a quick re little review though, if you 00:36:22.546 --> 00:36:25.006 didn't listen to that one, feel free to go back and listen to it. 00:36:25.006 --> 00:36:28.066 But really, what are eligible dependent care expenses? 00:36:28.066 --> 00:36:32.596 So really quickly, childcare centers or daycare facilities, those are all legit. 00:36:32.816 --> 00:36:35.876 preschool, nursery, or pre-K programs, all rights. 00:36:36.086 --> 00:36:39.146 Before and after school programs, summer day camps. 00:36:39.336 --> 00:36:41.646 if you have a nanny and you pay 'em on the books, all that 00:36:41.646 --> 00:36:43.806 stuff, that is all covered. 00:36:44.056 --> 00:36:46.966 What's not covered is basically private school. 00:36:47.026 --> 00:36:48.196 Like private tuition. 00:36:48.436 --> 00:36:51.706 If you do some type of overnight camps or you send your kids away in the summer 00:36:51.706 --> 00:36:53.566 for two weeks, that wouldn't qualify. 00:36:53.726 --> 00:36:57.076 kindergarten tuition, stuff like that is not, is not eligible. 00:36:57.076 --> 00:36:58.976 Tuition, or tutoring. 00:36:59.026 --> 00:36:59.776 all those things. 00:36:59.976 --> 00:37:01.086 No joy on that one. 00:37:01.146 --> 00:37:03.306 The other thing is who qualifies as dependent? 00:37:03.646 --> 00:37:06.406 your child has to be under the age of 13. 00:37:06.506 --> 00:37:08.756 and obviously you claim them as a dependent. 00:37:09.006 --> 00:37:11.826 you could also have a spouse or someone else that lives in your house 00:37:11.826 --> 00:37:14.736 that's a dependent, that is either physically or mentally incapable 00:37:14.736 --> 00:37:16.716 of self-care, they would qualify. 00:37:16.926 --> 00:37:20.346 So once again, the key with this one is though, and I know it affects a lot 00:37:20.346 --> 00:37:24.336 of our folks, so I just wanna highlight this, is you can only contribute. 00:37:24.351 --> 00:37:30.621 Up to, basically what you and your partner slash spouse have earned income for. 00:37:30.681 --> 00:37:34.371 So if you have someone that's a stay at home parent, all right? 00:37:34.431 --> 00:37:36.651 and they're not going to school and there's not some of these 00:37:36.651 --> 00:37:40.261 other, eligibility options, you can't contribute to this. 00:37:40.321 --> 00:37:40.771 All right? 00:37:40.771 --> 00:37:43.621 Because the purpose of this, the dependent care. 00:37:43.931 --> 00:37:47.051 FSA is to support both working parents. 00:37:47.051 --> 00:37:50.201 Outside of the home, and don't get me started on, you know, a single parent 00:37:50.201 --> 00:37:51.671 is, or someone that's staying at home. 00:37:51.671 --> 00:37:53.891 Man, that should definitely qualify as a job. 00:37:53.891 --> 00:37:53.951 Yeah. 00:37:54.201 --> 00:37:55.971 but that's just the way that the regulations are. 00:37:55.971 --> 00:38:00.101 So if you do have someone that's staying at home and is not currently working or 00:38:00.101 --> 00:38:04.391 earning income, don't contribute to this one because, they're not gonna let you. 00:38:04.391 --> 00:38:05.531 It'll be ineligible. 00:38:05.621 --> 00:38:06.041 All right? 00:38:06.461 --> 00:38:08.081 But that's the, that's the key with this. 00:38:08.806 --> 00:38:09.256 All right. 00:38:09.556 --> 00:38:15.216 So in in our president's fashion, there is a new account that's, being formed. 00:38:15.496 --> 00:38:20.056 they're calling it the Trump account or the Trump, savings account. 00:38:20.366 --> 00:38:22.851 and this is something that's supposed to get kind of a headstart. 00:38:23.466 --> 00:38:27.046 and any child that's being born, you know, for the next several years, it's 00:38:27.046 --> 00:38:29.896 supposed to kind of give 'em a leg up and it really wants to get people, 00:38:29.901 --> 00:38:33.676 I, I understand the incentive behind this and the reasoning behind it is 00:38:33.676 --> 00:38:37.546 they want all Americans basically to participate in the stock market. 00:38:37.766 --> 00:38:41.236 'cause there's still 40 to 50% of Americans do not 00:38:41.236 --> 00:38:42.376 participate in the stock market. 00:38:42.376 --> 00:38:45.316 So they're trying to give everyone a little slice of the pie. 00:38:45.346 --> 00:38:46.086 But, I don't know. 00:38:46.086 --> 00:38:47.511 You want to go through the kind of the Yeah. 00:38:47.611 --> 00:38:48.691 the list on this one, Louis? 00:38:48.736 --> 00:38:48.886 Louie: Yeah. 00:38:48.891 --> 00:38:51.286 So the, the Trump account is for babies born. 00:38:51.501 --> 00:38:58.941 In 2025 has to be born January 1st, 2025 through December 31st, 2028. 00:38:59.391 --> 00:39:02.091 So if you have a baby that's born between those years, which a lot of 00:39:02.091 --> 00:39:06.901 firefighters will, you can open up a Trump account for them and the government 00:39:06.901 --> 00:39:08.341 will see it with a thousand dollars. 00:39:08.341 --> 00:39:09.031 So it's a free. 00:39:09.371 --> 00:39:11.831 $1,000 contribution from the federal government. 00:39:12.231 --> 00:39:15.231 and that is kind of cool, like you could get that money for free 00:39:15.291 --> 00:39:16.431 just for opening the account. 00:39:16.641 --> 00:39:20.301 Jon: And this is one, not to cut you off too quick, quickly, but depending, 00:39:20.361 --> 00:39:24.321 I think they're still working through some of this because some of the sources 00:39:24.321 --> 00:39:27.471 that I have looked at that are reputable sources is basically saying that they 00:39:27.471 --> 00:39:29.451 are gonna open this up for every kid. 00:39:29.731 --> 00:39:33.391 Regardless if you open up for the, regardless if you open it up for 00:39:33.391 --> 00:39:35.851 your kid or not, they're gonna seed it with a thousand dollars. 00:39:36.301 --> 00:39:36.571 Interesting. 00:39:36.571 --> 00:39:38.641 I think this is still something that, like I said, I think they're 00:39:38.736 --> 00:39:38.886 Louie: working 00:39:39.031 --> 00:39:42.001 Jon: through the logistics and everything else like this. 00:39:42.131 --> 00:39:44.771 Louie: and it might be challenged in court, like who knows what's gonna happen. 00:39:45.186 --> 00:39:48.851 I, I think at, at least early understanding is that it's for sure for 00:39:48.851 --> 00:39:53.051 babies between born between 2025 and 2028, you, they'll get that a thousand dollars. 00:39:53.051 --> 00:39:57.221 Parents can choose to contribute up to $5,000 per year into the account. 00:39:57.581 --> 00:40:00.131 It's on a post post-tax basis though, so you will pay tax. 00:40:00.131 --> 00:40:01.361 You don't get the write off for it. 00:40:01.721 --> 00:40:05.741 You have to contribute it after you pay taxes on whatever amount you put into it. 00:40:06.341 --> 00:40:08.021 And then employers can also contribute. 00:40:08.241 --> 00:40:11.001 $2,500 per year if they choose to do so. 00:40:11.001 --> 00:40:14.331 And that is on a pre-tax basis that they get to contribute. 00:40:14.331 --> 00:40:15.321 So I guess that's good. 00:40:15.501 --> 00:40:19.071 If an employer wants to have this benefit where they say, Hey, we'll 00:40:19.311 --> 00:40:22.971 contribute $2,500 for each child you have, or something, that could be a nice 00:40:22.971 --> 00:40:26.391 way to have the account and it would be totally worth it in that situation. 00:40:26.881 --> 00:40:28.536 there's a little bit of, there's some rules over. 00:40:28.876 --> 00:40:30.586 How that money can be invested. 00:40:30.806 --> 00:40:35.066 it has to be invested in a diversified fund that tracks us stocks only. 00:40:35.586 --> 00:40:38.856 this is about America baby, not about, foreign investments. 00:40:38.856 --> 00:40:44.856 So they want all the investments from this money to be in US stocks, which is fine. 00:40:44.856 --> 00:40:48.186 As you know, John and I love the US Total Stock Market Index Fund. 00:40:48.186 --> 00:40:49.236 Huge believers in that. 00:40:49.236 --> 00:40:52.636 So, I get that it's not a huge deal, but that is just something to consider. 00:40:53.316 --> 00:40:57.066 And then the once you put money in, neither you nor the 00:40:57.066 --> 00:40:58.371 child can touch that money. 00:40:59.091 --> 00:41:00.441 Until that child is 18. 00:41:00.441 --> 00:41:02.541 And when I say you can't touch it, I don't mean that there's 00:41:02.541 --> 00:41:03.561 penalties for touching it. 00:41:03.561 --> 00:41:04.671 I mean, it is locked. 00:41:04.671 --> 00:41:05.961 You can't get it if you need it. 00:41:06.531 --> 00:41:07.881 I don't care if your kid has 00:41:08.001 --> 00:41:09.081 Jon: there's no hardships, 00:41:09.141 --> 00:41:09.891 Louie: disease. 00:41:09.891 --> 00:41:11.811 Yeah, you, you cannot touch that money. 00:41:11.811 --> 00:41:12.501 It is gone. 00:41:12.501 --> 00:41:14.601 You just have to assume that it went away. 00:41:14.996 --> 00:41:17.636 And that you'll get it back sometime in the future because 00:41:17.696 --> 00:41:19.556 you will have zero access to it 00:41:20.961 --> 00:41:21.141 Jon: when 00:41:21.146 --> 00:41:22.556 Louie: it does come time to withdraw. 00:41:22.616 --> 00:41:26.726 Withdrawals are treated very similar to a traditional IRA in the sense that 00:41:26.816 --> 00:41:29.576 they're taxed when you pull them out. 00:41:30.066 --> 00:41:34.266 and it's whatever your income tax rate is at the time, or whatever your 00:41:34.266 --> 00:41:36.096 child's income tax rate is at the time. 00:41:36.096 --> 00:41:38.856 I think that's an important thing to remember is this child. 00:41:39.086 --> 00:41:41.936 Or this account becomes the child's account when they turn 18. 00:41:41.936 --> 00:41:42.086 Correct. 00:41:42.536 --> 00:41:45.656 So even if your child is not in a good place financially and they're not 00:41:45.656 --> 00:41:50.126 responsible and you've been socking money in there and they have $150,000 00:41:50.126 --> 00:41:53.336 in there when they turn 18, they can take that money and go blow it. 00:41:53.336 --> 00:41:57.146 They can go spend it on whatever they want and you really can't stop 'em. 00:41:57.146 --> 00:41:58.196 'cause it's not your money. 00:41:58.196 --> 00:41:59.456 It really is for the child. 00:41:59.821 --> 00:42:00.151 Jon: Yeah. 00:42:00.301 --> 00:42:03.811 Very similar to what a lot of custodial accounts are set up as whatever 00:42:03.811 --> 00:42:06.841 that age of majority in, in every state's a little bit differently. 00:42:07.171 --> 00:42:08.791 But yeah, once that is a good point. 00:42:08.791 --> 00:42:11.851 Once they turn 18, which a lot of kids will still be in high school, honestly, 00:42:11.851 --> 00:42:15.541 at 18, they're gonna have full access to however much money this is, so they 00:42:15.541 --> 00:42:17.341 can take it all out and blow it on. 00:42:18.071 --> 00:42:18.311 I dunno. 00:42:18.311 --> 00:42:20.411 Something real nice, maybe a new, maybe a new truck. 00:42:20.656 --> 00:42:20.806 Louie: Yep. 00:42:21.786 --> 00:42:25.256 and then I think if, and, and that's, that's if they choose 00:42:25.256 --> 00:42:27.296 to take it out at 18, if they. 00:42:28.496 --> 00:42:32.946 Choose to wait until their retirement, retirement age 59 and a half, then 00:42:32.946 --> 00:42:35.796 they would just pay the ordinary income tax rate without penalties. 00:42:35.826 --> 00:42:35.886 Yeah. 00:42:35.886 --> 00:42:38.136 So if they choose to take it out before there is a penalty 00:42:38.136 --> 00:42:40.486 for that, it's a 10% penalty. 00:42:40.876 --> 00:42:42.586 and that's why we kind of said it's very similar to a 00:42:42.586 --> 00:42:44.266 traditional IRA in that sense. 00:42:44.356 --> 00:42:48.886 So the one, two exceptions to that is money can be withdrawn by the owner of the 00:42:48.886 --> 00:42:55.606 account for educational expenses, and they can take $10,000 out penalty free for. 00:42:55.691 --> 00:42:58.091 A home purchase and that's just a one time only thing. 00:42:58.091 --> 00:42:58.151 Yeah. 00:42:58.151 --> 00:42:59.741 Like you can take $10,000 and that's it. 00:42:59.771 --> 00:43:02.831 You can't keep doing it for your next home or your rental home or whatever. 00:43:02.891 --> 00:43:08.051 It's just you can take out $10,000 penalty free before retirement for a home. 00:43:08.601 --> 00:43:10.551 and that's kinda how the Trump account works. 00:43:10.581 --> 00:43:12.921 John and I were kind of talking about this right before the episode, but we were 00:43:12.921 --> 00:43:14.181 kind of like, yeah, you know, I don't. 00:43:14.686 --> 00:43:16.276 I don't think it's that revolutionary. 00:43:16.276 --> 00:43:17.116 I don't think it's that great. 00:43:17.146 --> 00:43:18.586 The free money, the a thousand dollars. 00:43:18.646 --> 00:43:18.976 Sure. 00:43:19.006 --> 00:43:19.486 That's great. 00:43:19.546 --> 00:43:23.336 I think if I had a child born, this year, next year, which I will not, but if I 00:43:23.336 --> 00:43:27.906 did, I would probably do it just for the, the thousand bucks, but I don't think 00:43:27.906 --> 00:43:29.676 I would contribute anything more to it. 00:43:29.676 --> 00:43:31.446 I think there's other ways that I could save for my child 00:43:31.476 --> 00:43:32.826 outside of that, that are more. 00:43:33.886 --> 00:43:35.836 Tax beneficial, if that makes sense. 00:43:36.211 --> 00:43:39.391 Jon: Yeah, I, I mean, when I was going through all these, I, I think initially, 00:43:39.391 --> 00:43:43.711 once again, I understand the, the intent of this and why they are trying to 00:43:44.011 --> 00:43:48.031 incentivize people to start contributing to the stock market, because that 00:43:48.031 --> 00:43:50.521 is how people are generating wealth. 00:43:50.521 --> 00:43:53.761 It's by owning companies and shares of companies, so they want. 00:43:53.936 --> 00:43:56.036 All Americans to be able to participate in this. 00:43:56.036 --> 00:43:58.406 So I definitely understand the intent behind it. 00:43:58.866 --> 00:44:02.976 I just wish it was a little bit juicier as far as the incentive from the government, 00:44:02.976 --> 00:44:06.456 IE if they continued to contribute, a thousand dollars per year if you 00:44:06.456 --> 00:44:10.356 kept this thing funded or like a match program or something else like that. 00:44:10.356 --> 00:44:11.816 But, I'll be honest, for. 00:44:12.481 --> 00:44:15.811 Educational savings, there's much better vehicles From a task 00:44:15.811 --> 00:44:19.081 perspective, from a withdrawal perspective, way better bang for your 00:44:19.081 --> 00:44:21.511 buck 5 29 plan makes way more sense. 00:44:21.941 --> 00:44:24.281 but if you're just trying to save up money for your kids and you 00:44:24.281 --> 00:44:26.201 don't know if your kids are gonna go to school or what they're gonna 00:44:26.201 --> 00:44:29.111 do, honestly just like a standard. 00:44:29.196 --> 00:44:30.336 Brokerage account. 00:44:30.336 --> 00:44:34.446 So a taxable account so you can open up at Fidelity or Schwab or any of these 00:44:34.446 --> 00:44:38.406 other discount brokers 'cause you're already having to pay the tax on it. 00:44:38.406 --> 00:44:41.826 That's the part I don't like about this Trump plan already is you 00:44:41.826 --> 00:44:44.526 already have to pay tax on this and then you contribute to the account. 00:44:44.766 --> 00:44:47.946 But yet when you kid withdraws the money. 00:44:48.286 --> 00:44:48.856 They're getting 00:44:49.481 --> 00:44:51.311 Louie: Yeah, it's like double taxation, man. 00:44:51.506 --> 00:44:54.326 Jon: I just, I don't, I don't like the, the mechanisms of this. 00:44:54.326 --> 00:44:57.896 So if you just wanna save up money for your kids and you want them to have, 00:44:57.946 --> 00:45:00.556 money down the road, whether that's for school or whether that's for a 00:45:00.556 --> 00:45:04.606 house or something else that they wanna pursue, they wanna be entrepreneurs, 00:45:04.606 --> 00:45:07.906 whatever, and you wanna have some seed money for them, just a standard. 00:45:08.411 --> 00:45:10.121 Brokerage account that you can put in their name. 00:45:10.121 --> 00:45:13.151 So a custodial account I think is a much better option. 00:45:13.151 --> 00:45:16.781 It gives you way more options besides just the US stock market. 00:45:17.101 --> 00:45:19.861 it's only gonna be when they take that money out, it's only 00:45:19.861 --> 00:45:21.721 gonna be, capital gains on that. 00:45:21.721 --> 00:45:24.811 And a lot of these guys will probably be in the 0% tax bracket 00:45:25.306 --> 00:45:27.226 Louie: Or I'll give you even, even a better option. 00:45:27.226 --> 00:45:31.186 In my opinion, it's a 5 29 account that's an educational savings account and 00:45:31.186 --> 00:45:33.566 with a recent, provision in a previous. 00:45:33.761 --> 00:45:38.091 piece of legislation, the 5 29 account now allows you to, roll 00:45:38.091 --> 00:45:41.931 forward up to $30,000 into a Roth IRA. 00:45:41.991 --> 00:45:45.741 So even if you were to put this money into a 5 29 account and then your child 00:45:45.741 --> 00:45:48.771 doesn't go to college, let's say they become a firefighter, they follow an old 00:45:48.771 --> 00:45:50.541 pop's footsteps and become a firefighter. 00:45:51.201 --> 00:45:52.371 So they don't need that money. 00:45:52.521 --> 00:45:52.611 Yeah. 00:45:52.641 --> 00:45:57.591 Well, $30,000 of it can be rolled forward into a 5 29, I'm sorry, into a Roth IRA. 00:45:58.251 --> 00:46:00.381 And then that's super beneficial because then that. 00:46:00.591 --> 00:46:06.521 Child who's now an adult has this, basically seated $30,000 contribution 00:46:06.521 --> 00:46:09.851 to a Roth IRA account, which as you already know, John and I love, 00:46:10.361 --> 00:46:14.231 and it grows tax free for them, and it's spent tax free in retirement. 00:46:14.231 --> 00:46:16.151 So I think that's a way better option. 00:46:16.361 --> 00:46:19.481 If you had, let's say you had $30,000 to put into an account, 00:46:19.961 --> 00:46:21.401 I'd say do it in a 5 29. 00:46:21.541 --> 00:46:21.841 Jon: Yep. 00:46:21.931 --> 00:46:23.311 No, that's a good point. 00:46:23.311 --> 00:46:26.281 That was recent changes with the secure 2.0 00:46:26.281 --> 00:46:28.801 act that allowed for that provision to happen. 00:46:28.801 --> 00:46:33.031 And I know a lot of planners and advisors that are, that are encouraging their 00:46:33.031 --> 00:46:37.531 clients to continue to fund those, even maybe over fund them, possibly with that, 00:46:37.621 --> 00:46:41.861 with that strategy or that plan that they will then, after they've either gone 00:46:41.861 --> 00:46:45.111 to school or they've decided not to go to school, they will start rolling over 00:46:45.111 --> 00:46:46.966 some of that money into the, into the. 00:46:47.341 --> 00:46:49.651 their child's account into a Roth account. 00:46:49.801 --> 00:46:51.151 Now, you can't do it all at once. 00:46:51.301 --> 00:46:52.861 You still have to hit the limits. 00:46:52.921 --> 00:46:54.901 So you could only do 7,000 per year. 00:46:55.051 --> 00:46:58.111 So you have to phase this in over five years in order to get that money in there. 00:46:58.111 --> 00:46:59.101 But it's a great leg up. 00:46:59.561 --> 00:47:00.551 so I, I don't know. 00:47:00.551 --> 00:47:01.051 I, I, I. 00:47:01.226 --> 00:47:05.326 I just think for the majority of our folks, I think there's other strategies 00:47:05.326 --> 00:47:07.876 if you really want to save for your kids in a different manner, whether 00:47:07.876 --> 00:47:09.406 that's education or something else. 00:47:09.411 --> 00:47:11.266 I, I think there's better opportunities out there. 00:47:11.266 --> 00:47:14.336 I think this is for people, that just don't have, maybe they've never 00:47:14.336 --> 00:47:15.866 participated in the stock market before. 00:47:15.866 --> 00:47:17.366 They don't have any of these accounts. 00:47:17.366 --> 00:47:18.911 They don't have a, a retirement account. 00:47:18.911 --> 00:47:21.156 A lot of these other things, which, unfortunately a lot of 00:47:21.156 --> 00:47:23.106 our society, Is in that boat. 00:47:23.106 --> 00:47:24.816 I think that's really who this is set up for. 00:47:25.296 --> 00:47:26.606 So, so that's the Trump 00:47:26.931 --> 00:47:27.171 Louie: Yep. 00:47:27.561 --> 00:47:30.441 And then I think one of the final ones we'll talk about, is going 00:47:30.441 --> 00:47:32.421 to be charitable deductions. 00:47:32.961 --> 00:47:35.811 And before we get started, I just want to do a quick shout out. 00:47:35.811 --> 00:47:39.671 So, The fire service in general, the IFF partners with the 00:47:39.671 --> 00:47:41.261 Muscular Dystrophy Association. 00:47:41.771 --> 00:47:41.831 Yeah. 00:47:41.831 --> 00:47:45.251 And then every fall for like the last 80 years, firefighters will do 00:47:45.251 --> 00:47:46.751 what's called fill the boot campaign. 00:47:46.751 --> 00:47:48.521 And that's really how the MDA is funded. 00:47:48.581 --> 00:47:53.191 They will, firefighters will go out to stores, storefronts and collect money, 00:47:53.251 --> 00:47:57.031 raise money, and all that money is given to the Muscular Dystrophy Association, 00:47:57.371 --> 00:47:59.171 to help children with that disease. 00:47:59.201 --> 00:48:01.901 So it's a really cool program, really cool partnership that we have with them. 00:48:02.291 --> 00:48:04.441 And, My own crew. 00:48:04.441 --> 00:48:07.411 Station three A collected the most Yep. 00:48:07.411 --> 00:48:08.551 From our department. 00:48:08.551 --> 00:48:13.321 So shout out to all my homies on three A who were out there hustling and, 00:48:13.751 --> 00:48:15.881 doing a good job raising money for MDA. 00:48:16.061 --> 00:48:18.881 Jon: I guess we can disclose where, where Res goes to collect. 00:48:18.911 --> 00:48:19.901 they do it every year. 00:48:19.961 --> 00:48:23.921 and there's other places that go, but you know, they go over their Wally world and 00:48:23.921 --> 00:48:27.161 it's just, and you know, I was talking to Reed about this and it's interesting to 00:48:27.161 --> 00:48:33.141 me, just society, you know, like most, a lot of those people, are not on the hire. 00:48:33.371 --> 00:48:34.271 socioeconomic 00:48:34.661 --> 00:48:35.651 Louie: very working class. 00:48:35.651 --> 00:48:36.731 They're very, especially at that 00:48:37.031 --> 00:48:38.531 Jon: they're very working class. 00:48:38.601 --> 00:48:43.681 but yet these are continuing to be the people that give the most, literally 00:48:43.681 --> 00:48:47.191 you got kids that are going to their piggy banks, whatever, in their car, 00:48:47.191 --> 00:48:49.631 dumping a bunch of change, whatever. 00:48:49.691 --> 00:48:51.821 And it's, it's fascinating to me. 00:48:51.821 --> 00:48:54.761 And then you go to other places, much more fluent places. 00:48:55.331 --> 00:48:57.161 They won't even look you in the eye kind of thing. 00:48:57.161 --> 00:48:58.181 And it just, I don't know. 00:48:58.181 --> 00:49:00.501 There's a lot of, behavior associated with that. 00:49:00.501 --> 00:49:03.471 There's a lot of psychology behind that, but it's, it's, it's 00:49:03.471 --> 00:49:04.731 just always eyeopening to me. 00:49:04.731 --> 00:49:08.071 I remember going when I was at threes, going to that Walmart, and 00:49:08.071 --> 00:49:13.081 just being really, I was taken aback by just how, supportive they were. 00:49:13.141 --> 00:49:13.771 Louie: how giving they were. 00:49:13.776 --> 00:49:13.866 Yeah. 00:49:14.041 --> 00:49:18.021 Jon: and really literally giving the shirt off their back, so to speak, in order 00:49:18.021 --> 00:49:19.881 to help someone else, shout out to them. 00:49:19.971 --> 00:49:20.271 Louie: Yeah. 00:49:20.361 --> 00:49:22.711 And that's not to say that, the affluent don't give, maybe they 00:49:22.711 --> 00:49:23.851 just, they need to have the receipt. 00:49:23.851 --> 00:49:27.416 Maybe because they get a deduction, they get a deduction. 00:49:27.421 --> 00:49:29.971 So that segues into our charitable deduction. 00:49:30.181 --> 00:49:33.091 Portion of the bill of the OBBA. 00:49:33.671 --> 00:49:37.871 so starting in 2026, everyone can deduct charitable contributions, 00:49:37.951 --> 00:49:39.091 which is kind of cool. 00:49:39.091 --> 00:49:41.971 So for a single filer, that's a thousand dollars that you can deduct. 00:49:42.481 --> 00:49:46.921 And for a married couple filed filing jointly, that's a $2,000 deduction. 00:49:46.921 --> 00:49:47.251 And that's. 00:49:47.396 --> 00:49:49.826 Once again above the line deduction, which is good. 00:49:50.276 --> 00:49:53.216 And so that will lower your adjusted gross income, which is what you want. 00:49:53.216 --> 00:49:53.276 Yeah. 00:49:53.666 --> 00:49:56.906 So this doesn't matter, like before, previously you used to have 00:49:56.906 --> 00:50:00.746 to itemize in order to take out those charitable contributions. 00:50:01.116 --> 00:50:03.696 but right now, even if you take the standard deduction, or I shouldn't say 00:50:03.696 --> 00:50:08.796 right now, starting in 2026, when you file your taxes, you can, Take your deductions 00:50:08.796 --> 00:50:11.881 for charitable contributions and get a little tax break on that, which is nice. 00:50:11.881 --> 00:50:12.126 Which is nice. 00:50:12.151 --> 00:50:12.841 Jon: Which is nice. 00:50:12.841 --> 00:50:13.021 Yep. 00:50:13.021 --> 00:50:13.081 You 00:50:13.146 --> 00:50:15.546 Louie: gotta save your receipts because if you're audited, they're gonna ask 00:50:15.546 --> 00:50:17.286 you, well, what did you give that to? 00:50:17.316 --> 00:50:19.806 So the people that contributed to fill the boot with cash, 00:50:20.136 --> 00:50:21.336 ugh, probably can't do that. 00:50:21.616 --> 00:50:23.416 it might only be a few bucks here or there. 00:50:23.616 --> 00:50:27.666 But if you have like a organization or a cause that you're really into, 00:50:28.036 --> 00:50:30.586 and you write them a check or you pay with your credit card, or even if you 00:50:30.586 --> 00:50:32.176 give cash, you can ask for a receipt. 00:50:32.596 --> 00:50:34.426 You can save that receipt, just scan it. 00:50:34.426 --> 00:50:37.226 That's what I do with all of my, charitable giving is I just scan the 00:50:37.226 --> 00:50:38.666 receipts and then I keep 'em in a. 00:50:39.321 --> 00:50:41.391 Like in a Google folder or something like that. 00:50:41.781 --> 00:50:45.531 And that way if I ever get audited, I can show that I would, that I did actually 00:50:45.531 --> 00:50:48.741 give the amount that I said, but it's another way to save a little bit of money. 00:50:48.976 --> 00:50:49.336 Jon: Yeah. 00:50:49.336 --> 00:50:52.906 And that one is, I mean, just with all these things, with the IRS and any type 00:50:52.906 --> 00:50:58.256 of deduction you are taking, you are on the hook as the taxpayer, for proving 00:50:58.256 --> 00:51:00.896 that you were eligible for that deduction. 00:51:01.166 --> 00:51:05.336 Once again, it's a rare outlier circumstance, but if you are audited, you 00:51:05.336 --> 00:51:07.576 will have to produce, those documents. 00:51:07.576 --> 00:51:08.776 So I'm guessing. 00:51:09.046 --> 00:51:10.966 once again, there's gonna be a lot of people that are 00:51:10.966 --> 00:51:12.166 gonna claim this deduction. 00:51:12.256 --> 00:51:15.676 A lot of people are gonna claim this deduction because it's above the line. 00:51:16.036 --> 00:51:20.026 but once again, if you are claiming this deduction, you have to be eligible. 00:51:20.026 --> 00:51:24.046 So you have to have to have those receipts in order to prove that eligibility. 00:51:24.046 --> 00:51:27.136 So that is nice though, because there are people that are charitably inclined. 00:51:27.376 --> 00:51:31.786 They're not giving away $50,000 a year, but they are giving several hundred or up. 00:51:31.841 --> 00:51:33.011 To several thousand a year. 00:51:33.011 --> 00:51:34.541 And it's nice that those people do get credit. 00:51:34.541 --> 00:51:38.321 'cause before they, it just would've been, well, this is what I did because I believe 00:51:38.321 --> 00:51:41.211 in the cause, not for a, tax purpose. 00:51:41.391 --> 00:51:45.411 So I do appreciate that they are throwing, the average taxpayer bone on that one. 00:51:46.221 --> 00:51:48.571 So those are the highlight issues. 00:51:48.631 --> 00:51:52.816 what Louis and I feel are probably the most relevant, to the people 00:51:52.816 --> 00:51:55.696 listening to this podcast, and for those of you that are. 00:51:55.881 --> 00:51:56.991 That are in the fire service. 00:51:56.991 --> 00:51:59.691 We think that this is probably what's going to affect you the most. 00:52:00.021 --> 00:52:02.871 Now there is, this is obviously not all inclusive, right? 00:52:02.871 --> 00:52:06.231 There's a lot of things that we omitted just because they are very specific and, 00:52:06.541 --> 00:52:09.511 there are a lot of different resources out there when you're researching this 00:52:09.511 --> 00:52:13.691 as far as, specific things, and I'm sure there's gonna be more to come, regarding 00:52:13.691 --> 00:52:16.811 just how some of this stuff is actually going to get implemented because it's 00:52:16.811 --> 00:52:18.671 easy for them to pass legislation. 00:52:19.056 --> 00:52:22.246 But to get this actually implemented there might be changes with this, the 00:52:22.246 --> 00:52:23.656 next month, the next couple months. 00:52:23.656 --> 00:52:26.806 So, broadly speaking, this is just how this stuff is all gonna 00:52:26.806 --> 00:52:30.266 unfold, at least the way that the legislation is currently written. 00:52:30.266 --> 00:52:31.406 So, I don't know. 00:52:31.406 --> 00:52:35.476 All in all, like I said, I feel like, the majority of taxpayers are getting a break. 00:52:35.746 --> 00:52:37.786 They are gonna continue to pay historically low. 00:52:38.736 --> 00:52:43.116 Tax rates, they're getting some additional credits or some incentives in some 00:52:43.116 --> 00:52:46.176 circumstances to modify some behaviors. 00:52:46.426 --> 00:52:49.336 so, overall I do, I do think it's beneficial. 00:52:49.526 --> 00:52:53.916 I wish it didn't come at the, at the hes of, Medicaid, because once 00:52:53.916 --> 00:52:57.106 again, that is going to, affect fire departments throughout the country. 00:52:57.161 --> 00:52:59.281 in your revenue and how you guys are getting reimbursed. 00:52:59.281 --> 00:53:01.601 So, and also healthcare premiums, right? 00:53:01.601 --> 00:53:03.871 Those things have already gone up, up and up and up. 00:53:03.871 --> 00:53:05.821 This is just gonna accelerate that, that much more. 00:53:05.821 --> 00:53:08.071 So it's a, it's a give and a take. 00:53:08.101 --> 00:53:09.121 It's not perfect. 00:53:09.461 --> 00:53:10.301 but that's the bill. 00:53:10.361 --> 00:53:12.491 and that's how we see it, affecting you guys. 00:53:12.791 --> 00:53:14.591 Anything else you wanna riff on that one? 00:53:14.691 --> 00:53:16.851 kind of interesting to, to go through that one. 00:53:17.011 --> 00:53:19.231 and just, and just give you guys some of the highlights. 00:53:19.561 --> 00:53:23.751 So that's, that's what we got You wanna give your best, Trump impersonation? 00:53:23.766 --> 00:53:24.756 Louie: No, it's pretty bad. 00:53:24.756 --> 00:53:26.526 I already gave it and that's as good as it gets. 00:53:26.526 --> 00:53:27.186 It's not very good. 00:53:27.516 --> 00:53:28.146 I'll work on it 00:53:28.191 --> 00:53:28.461 Jon: though. 00:53:28.461 --> 00:53:30.261 Hey, dude, you gotta start someplace. 00:53:30.291 --> 00:53:32.361 when you first came in here and I was like, that was pretty good. 00:53:32.601 --> 00:53:33.711 But maybe on the spot. 00:53:33.721 --> 00:53:36.441 Louis's a little, a little gun shy on that one. 00:53:36.441 --> 00:53:39.036 you guys know how to get ahold of us by now, our listenership does 00:53:39.036 --> 00:53:40.896 continue to increase, every month. 00:53:40.896 --> 00:53:44.376 So we definitely appreciate that and we'll continue to try to kick these 00:53:44.376 --> 00:53:48.576 off, once a month and, and give you guys, stuff that we feel is, pertinent. 00:53:48.636 --> 00:53:52.336 this was timely obviously, with this just being signed a couple months ago. 00:53:52.396 --> 00:53:53.566 and we'll continue to try to. 00:53:53.911 --> 00:53:57.391 Provide you guys with some, just some talking points and just really just spur 00:53:57.391 --> 00:53:59.381 that discussion, with a lot of this stuff. 00:53:59.381 --> 00:54:01.691 I don't know if we know what's queued up for now next month. 00:54:01.691 --> 00:54:02.891 I think Louis and I still have to 00:54:02.896 --> 00:54:03.766 Louie: we need do a little planning 00:54:04.031 --> 00:54:05.301 Jon: a little planning session, little planning session 00:54:05.426 --> 00:54:08.926 Louie: if you guys have anything that you're super, motivated to learn 00:54:08.926 --> 00:54:12.616 about or you want us discuss, please always feel free to drop us a line at. 00:54:12.616 --> 00:54:15.256 Ask fiscal firehouse@gmail.com 00:54:15.586 --> 00:54:17.146 or you can follow us on Instagram. 00:54:17.276 --> 00:54:19.136 our handle is fiscal firehouse. 00:54:19.466 --> 00:54:22.076 And you can send a private message to me that way too. 00:54:22.136 --> 00:54:24.926 And I, we read every, we read all of the emails, we read all of 00:54:24.926 --> 00:54:26.336 the private messages that we get. 00:54:26.411 --> 00:54:27.221 Jon: a lot of fan mail. 00:54:27.271 --> 00:54:30.061 I mean, dude, it's literally every time I look in there, it's like, ah, 00:54:30.241 --> 00:54:31.801 dude, I gotta respond back to this. 00:54:31.801 --> 00:54:35.671 Like, I didn't have this 30 minutes blocked off in my calendar to respond all 00:54:35.746 --> 00:54:36.436 Louie: There you go. 00:54:36.631 --> 00:54:38.731 Jon: But no, we do get a lot of, kudos. 00:54:39.011 --> 00:54:40.841 and we just appreciate people listening. 00:54:40.906 --> 00:54:42.496 So we'll keep, we'll keep producing. 00:54:42.496 --> 00:54:46.136 So, we will let you guys get on with whatever you're doing, walking the dog, 00:54:46.136 --> 00:54:48.296 driving into the 9:00 AM shift change. 00:54:48.296 --> 00:54:50.756 We'll see what, we're not gonna talk about that 00:54:50.881 --> 00:54:51.201 Louie: not yet. 00:54:51.301 --> 00:54:51.531 Not yet. 00:54:51.531 --> 00:54:51.546 That's 00:54:51.746 --> 00:54:52.166 Jon: the vote. 00:54:52.166 --> 00:54:52.886 But do vote. 00:54:52.916 --> 00:54:55.226 We do have a, a referendum vote coming up. 00:54:55.226 --> 00:54:56.616 Louie, always a pleasure. 00:54:57.166 --> 00:54:58.126 Louie: Always good working with you. 00:54:58.426 --> 00:55:00.106 Stay safe and keep saving. 00:55:00.316 --> 00:55:02.896 Disclosure: The Fiscal Firehouse Podcast is a podcast curated 00:55:02.896 --> 00:55:05.386 specifically for local 1309 members. 00:55:05.506 --> 00:55:09.196 This podcast is for informational and educational purposes only, 00:55:09.406 --> 00:55:12.316 and should not be construed as professional financial advice. 00:55:12.466 --> 00:55:15.196 Should you need professional advice, consult a licensed 00:55:15.316 --> 00:55:17.716 financial advisor or tax advisor. 00:55:17.896 --> 00:55:21.766 The opinions of John Beatty, Louis Barilla and their castmates are 00:55:21.766 --> 00:55:25.006 solely their own, and don't reflect that of West Metro Fire Rescue.