It's that time of year again! If you're feeling increasingly stressed when tax season rolls around, it may be time to make some changes.

In this episode:

• Explore the latest college football coaching changes and player transfers that are shaking up the game.
• Discover potential reforms in college football and their implications for the future of the sport. (9th grade)
• Gain insights into the Federal Reserve’s decision on interest rates and its potential effects on the economy.
• Consider important tax tips for this year's filings.
• Get final predictions for Super Bowl LVIII: Chiefs v. 49ers at Allegient Stadium in Las Vegas.

I think the communication piece is important. It could be a 401K rollover, let the CPA know that that's going to be reflected on the tax return. - Jon

What to Know for This Year's Tax Filings

The key to a smooth tax filing process is to stay organized and communicate with your tax professional. Learn a few key insights including how to potentially lower your tax liability in your investments by better controlling your capital gains. Understand how your financial advisor and CPA can work together to optimize your tax opportunities.*

Relevant Resources:

https://www.marketwatch.com/economy-politics/calendar

Important Disclosures

*Morton Brown is neither a law firm nor a certified public accounting firm and no presentation, post, or portion of any podcast content should be construed as legal or accounting advice.

Connect with Your Hosts:

Cody Demmel on LinkedIn

Sean Roth on LinkedIn

Jon Kerstetter on LinkedIn

Welcome to Coachable Wealth, where we blend the worlds of sports and finance to bring you strategies as you navigate your wealth-building journey. John, Cody, and Sean are here to help you elevate your financial advisor relationship to meet your long-term goals. Now, let's get to it. Morton Brown Family Wealth a little bit. Cobol is always, I don't know, kind of blah, but I like that they threw in some of those skills challenges.

I think there was a little piece of it I caught. It was the quarterback challenge. And then also they had some of the offensive linemen. I saw Jason Kelsey and some of the other linemen in the NFL. They kind of had to snap the ball into targets on a board, which I thought was pretty.

Oh, yeah, I saw that. And the smaller the target hole, the more porn value there. Yeah. To your point, Cody, I thought the skills challenge was a pretty nice alternative to watch. Yeah.

Instead of obviously people aren't going all out in the Morton Brown Family Wealth and that's why they changed it. Before they obviously had pads on and everything, but now it's just pretty much flag football, which was interesting. But yeah, I agree. I like the skills challenging a little more than the actual football playing just because nobody's really trying their hardest. I'll be honest, I didn't watch a second of the Morton Brown Family Wealth, and I don't think I have in the last probably seven years since they really stopped trying.

It seemed like this year there was quite a few players you didn't expect to be in the Morton Brown Family Wealth were down there. I know the quarterback room was probably the most different or unknown of any years past. I think with some quarterbacks. I know Garter Minshew was down there, Jalen Hurts, who really had a great first half of the season and a really tough second half. So it was interesting to see some different quarterbacks down there.

Yeah, I was wondering why so many quarterbacks backed out. Because it's not like they have an injury concern because they're not tackling or anything. Yeah, I can remember watching that back in the day with Peyton Manning and Tom Brady going out at those competitions and some of those videos always pop back up. They're always fun to watch. Yeah, I saw an old clip last night and I think it might have went back seven or eight years when they used to have it over in Hawaii every year and it was still a competitive mean.

They were full pads, full tackling. I mean, it was a live game. Yeah, definitely not anywhere close to that anymore. I really wanted to watch the UNC Duke game, which I do on an annual basis, I was only able to catch the highlights. I was happy to see that UNC did beat Duke.

I know they play again in a couple weeks. And then I also watched a little bit of the PGA out at Pebble Beach. I know it was cut short just because of the bad weather they had out there. So I did watch some of that because they initially postponed, obviously, Sunday because it was raining the entire day and they were going to try to play on Monday. But I saw that last night.

They completely just said, we're done, and Wyndham Clark wins. So that was interesting to see that. Obviously the weather's. I know California is getting a ton of rain coming up, so that was interesting to see that. I can't even remember the last time that they cut a tournament short after three days.

And I wonder what they would have done if there was someone else tied with them. They would have just been, we split it. That's a good point. I assume they would split it. Did you see the highlight of Tom Brady off the tee where he kind.

Yeah, I saw that on Twitter or yeah, that when he was driving the one, it went like 3ft in front of us and it was like, yep, Tom Brady's actually human. Yeah, because I think he is normally pretty good at golf. I think he's like a single digit. Yeah, the one drive literally went like 2 feet in front of him. I don't know if you guys follow anything on the women's side, but do you know who the number one college athlete is right now in the NCAA?

Is it Caitlin Clark? Yes. I saw that they were having like a Caitlin cam on TikTok over the weekend. I obviously didn't tune in, but I think she's what, like 100 points after? I think she's averaging what, 30 plus a game, I believe.

Yeah, that's crazy. And she shoots like, I think, almost 40, 45% from three, which is crazy because obviously, everybody knows she's the person you have to stop. And she's still hitting 40 45% from three. People are. I forget what.

Announcer maybe it was Charles Barkley. Somebody called her Steph Curry of women's basketball. Yeah, that's what I heard, too. They said she's kind of equivalent stats and they're calling the Steph Curry of crazy. Is Iowa primed to make another national title run?

I honestly don't follow women's basketball that closely, but I think they're in the top ten, maybe top five. Was it last year? Was it that Iowa versus, I think, LSU in the national championship game or at least the final four. I know that matchup occurred. Yeah.

I'm not sure if it was the national title or the final four, but they definitely played. What are your thoughts on the Super Bowl? See some of the stories about how expensive it is with it being in Las Vegas this year? I saw the stories. Just the average ticket, it's the most expensive of all time.

What was like $8,000 or something like that in that ballpark? It's something like that. And a luxury suite was what, two and a half million? Yeah. Paying two and a half million dollars for a suite that gives you, what, ten to 20 tickets?

Yeah. It's crazy. I imagine as a player, I'm sure you get all kinds of family that you've never heard of coming to ask for tickets. And I've seen videos and stories of athletes saying the Super bowl was the most stressful time in their life, not from a playing standpoint, but from all of the other aspects of. Because you're only allotted so many tickets.

Correct. For family for the Super bowl. It's not a high number. I don't think so. If you have a lot of family, I can imagine it'd be stressful.

I mean, there's the stories. Know McCaffrey out there who's recently was talking about how he couldn't. The two and a half million dollar suite just adds another dynamic from a player standpoint, I think. Yeah. I didn't realize Brock Purdy was the last pick in the draft.

Yeah. Realize that. Have there ever been any other very successful. What are they called? Mr.

Irrelevant? Yeah. Has there ever been someone else who's been successful at that pick? I don't think to this level that I'm aware of. I mean, I know there's been players that have been mean.

The only one that I can think of off the top of my head was Maurice Clarette from Ohio State. I believe he was Mr. Irrelevant back in the day. Okay, so one other thing we were talking about earlier is obviously it's getting into tax season now. People are filing their taxes.

W two s are coming out. I'm sure 1099 will start coming out from the investment firms. Anything specific that people should think about when they file taxes? I think that one of the big things is just getting yourself organized, understanding what documentation you need as what Cody said. Like the w two s, the think just as a starting point, just getting all of those documents in order and kind of having a ballpark figure of kind of, hey, here's what my earned income was some of those items, my deductions, how much I contributed to, say, a 401K or IRA.

I think some of the surprises might come on potentially some realized gains or dividends that come from portfolios. Those seems to tend to be a little bit of surprises sometimes. Yeah. One thing that we've noticed over the past couple of years, and especially when we have good years in the stock market, is sometimes if you hold a mutual fund and it's inside a taxable account, even though you didn't sell the mutual fund, you may get a capital gain distribution. And some of the reasons for that is if there's outflows of a mutual fund.

So say you were holding a mutual fund, it's up 20% last year. You may get a 5% capital gain even though you didn't sell. And the reason for that is the mutual fund. If people were selling out of it, they had to sell some of the stocks to give the individuals their money back. And you may get hit with a capital gain, which normally happens in strong years in the stock markets, 2020, 2021, and potentially last year in 2023.

That may be something that some clients potentially weren't aware of if they had mutual funds in a taxable account. Cody, are those limited to a certain time of year? Normally they come out in December. Yeah. So normally the mutual fund distributions, whether it's capital gains or maybe a larger dividend, come out in December.

And you can try to get ahead of it. If you know the exact mutual fund that you have, normally they give some estimates beforehand. So working with your advisor, if you do have a taxable mutual fund and seeing if there's a good opportunity to rebalance out of that, so you're not hit with that capital gain, because if you're in the high tax bracket, say you get a capital gain distribution of $10,000 and you didn't actually sell your fund, seeing that capital gain is not going to be a happy surprise when you go to file your taxes. Cody, is there any way or anything that as an advisor you can do to help mitigate those? I know you said become aware of kind of when those distributions hit, I know you can kind of go back the previous, I guess, quarters and look what those distributions were.

But is there anything from, like, a product standpoint that we could do to mitigate those? One of the major things would be using etfs instead of mutual funds. So the only way you're going to get a capital gain on an ETF is if you actually sell it. So you will have control of when those taxes are raised, whether it's in a year where your income is a lot lower or if you potentially have any losses. So if you have any capital losses that you can offset some of the gains, say you had your account at a mutual fund provider and you have a couple of hundred thousand in there, and they have a 5% capital gain distribution.

As I said, that may be 10,000, $20,000 that you weren't expecting, but there may be some opportunities outside of that one individual fund to take some losses, realize that loss to offset those gains, and still not miss any time, the market just rebalance into another fund. Yeah. John, and going along with what you said about being prepared, I mean, there are so many stories. We hear it. I'm sure you hear all the time on the planning side of people just not being organized with their taxes and having things all over the place.

I know one thing we try to always instill is to have a relationship with our clients, tax professional, to create bridge between us and them. So when things do occur or there's changes, we can communicate that and stay on top of things. So there's really nothing we're not prepared for. I think the communication pieces, yeah, it could be a 401K rollover. Let the CPA know that that's going to be reflected on the tax return.

A roth conversion, a charitable donation, could be a qualified charitable donation, and it's going to be reflected on the 1099. But the box is going to be checked as undetermined. So the CPA might see that, that it's checked undetermined, but they might not know the granular detail behind it. So, inventory kind of what happened in the last tax year and just communicate with the CPA to let them know this is what occurred, just so there's not any mistakes made by them. We all know that cpas are really busy this time of the year.

So I think the more communication from us, the advisor, the financial planner, and with the client, it's just going to help out the whole process more. Yeah, that's important. Speaking of charitable donations, one thing we were talking about recently is nil, and potentially one of the major reasons why, if you look just this past season, a lot of college coaches were jumping to the NFL or retiring. Obviously, we saw Nick Saban retire. Yeah.

It's kind of amazing when you look into the 501 C three organization, kind of how broad I guess the rules and guidelines actually are. I can just kind of talk from personal experience. So let's say some college football tickets for a specific college or university. There's a portion of that that's actually counted as a charitable donation. It's for the benefit of the student athletes.

You can actually use it as an itemized deduction. And then, as Cody said on the name, image, likeness side, basically you're giving money to a specific athlete and that x amount actually counts as a charitable donation. So if you are itemizing your taxes or receiving that itemized deduction, you can put that as a deduction. Yeah. Unorthodox, a little bit.

Charitable donation? Yeah, no, and I think a lot of coaches are kind of getting sick of it. And I think that's one of the. Nick Sabian even said it, that was one of the major reasons why he retired is before it was know, just talking through your football program, the athletes, most of them are getting free scholarship, so they're getting the free education. But now it's not just that they're getting actually money from these universities or these nil foundations to actually go play for the football team.

So it's a lot more work in recruiting inside the college football atmosphere. Whether it's getting a player right out of high school or now we have the transfer portal where people are, maybe they have one good year at a smaller university and they shot up the rankings and now they're going to a larger program and getting the money from the mean. You can look at it. I don't think there's one returning starter on the Washington Huskies coming back next season, really, who were just in the national title and their coach left and everybody followed. And as a coach and somebody who played in college, I can't even fathom being a part of what's going on.

And you almost have more control as a coach in the NFL than you do in college, because in college you have to win. Or as a coach, you and your family are going to be out of a job. You're going to be moving somewhere else. Maybe, John, you're just a better quarterback than Cody. So I'm going to start you.

And Cody's two years younger, and Cody's the future. But now Cody never has to wait. Cody's going to go $3 million to go be the quarterback. Some school, it never ends, I think. And as a coach, I think Gino Ariema said something the other week of players used to have to show me why they wanted to be here and why they should stay.

Now I coach have to show players why they should be here and why they want to stay. And in just a matter of two or three years, that's flipped, which as a coach, I can see that stress level is probably through the roof at all times at the college level. Yeah, I mean, it'll be interesting to see if anything changes in the nil format. I know the Big ten conference and the SEC are meeting here soon to see if they can or I guess I'm not exactly sure what they're talking about, but I assume it's trying to make this a little more official. So people aren't changing schools every single year if they're not getting the starting opportunity.

A few years ago at 17 or 18 years old, you had to make a decision of what school you wanted to be at and then stay there or else you had to sit out a season and nobody wanted to miss any seasons, but your coaches could come and go as they please. So I think there's got to be some type of limit to the transfer portal. Maybe you get one free pass because at 17 or 18 you can't know the things that are going to happen to your staff down the road. And let's say you're a tight end and you get recruited to go play at some school and then next thing you know a new coach comes in and there are five wide receivers all the time and hey, we don't need a tight end. So obviously you want to leave, but there's people that have been in school for what, 910 years now at this point and they've played for six colleges.

I think there should be a stop put to that, in my opinion. Yeah, no, there's just so much moving around and sticking at one program, getting the stability. It's the same thing in financial planning. Put the plan together. There's small tweaks you want to make over the long term, but it's making sure you have that habit set up of contributing to your 401K, potentially taxable account and getting the game plan set in place.

But then along the way, making tweaks, not completely changing everything. Just because one thing changed inside your personal life movement does not always equal progress. Good point. The overall major college athletic, mainly college football landscape is probably not trending for the better. And as mean there's, there are real life examples.

I mean, Nick Saban retiring. The rumors are that he just didn't like where the trajectory of college football is headed. Hey, I'm going to retire the head coach of Boston College, leaving as a head coach to become a defensive coordinator. Green Bay packers. Now, I mean, it's not a bad lateral move, but it's just examples.

I mean, I think Chip Kelly too. They're saying that might want to get out of UCLA as a head coach and become an offensive coordinator in the NFL, just basically for better wellness and quality of life. And I know Sean talked about it like the recruiting is all year round now. You're recruiting new players and you're also recruiting your current athletes and your team just to keep them for the upcoming season. And I think it's become so stressful.

And the coaches really aren't coaching football anymore. They're just year round recruiters. And I don't think that's where they want to head. And I think what Cody said too, is the Big Ten and SEC are forming an alliance to potentially try to not change the whole landscape, but tweak it for the better. So I think that will have some big impacts going forward here, hopefully.

And I also saw some talks about maybe potentially doing like a CBA collective bargaining agreement, just kind of benefit the athletes a little more and make some more sense of kind of what's going on in the current college landscape. Yeah, it'll be interesting to see what comes out of that. I know last week we had the big Fed decision came out saying that they're leaving interest rates the way that they are, and we saw a little bit of movement in the bond market potentially. They also said that based on where everything's going right now, it's too early to say that they're going to cut in March, which a lot of people expected then to do. So we saw a little rise on the interest rate environment, but hopefully inflation continues to come down.

The economy is still very strong. That was another reason why they mentioned that they're not cutting interest rates is we added another 353,000 jobs last month, which was way above expectations. The unemployment rate actually went down from 3.8 to 3.7%, which is showing that the economy is still very strong. Inflation is still a little higher than where they want. So it'll be interesting to see what the numbers are over the next couple of months before their next decision on if they cut interest rates or not.

I know this week is another fairly big week for earnings. I know last week was kind of the key week for especially tech earnings. I think the interest rate. Just discussion. I think everyone's so used to interest rates being close to zero, and you go back, what, 1020, 30 years, 5%, five and a quarter rate is low.

There's really nothing wrong with it. But in this environment, everyone's like, oh my God, it's so high, it's almost interesting. Like if they don't cut, what happens if they just keep the rates where they are? Yeah, it'll be interesting to see how the economy responds to that. At least now if hopefully we don't have a recession or any downturn in the economy, but if we do, now that the interest rates are higher, the Fed at least has a tool to hopefully spur the economy where when interest rates were zero before, if we did have a slowdown in the economy, the Fed really had nowhere to go where now they can spur the economy if they start cutting interest rates.

So if we do have a slowdown, they actually have a tool now to start potentially the economy going better again and cutting interest rates. As I said, hopefully that doesn't happen, but they at least have the flexibility now that they haven't had for a while. I think the other thing I'm just kind of personally curious about is just how far the magnificent seven, I believe they're calling it, is going to continue to run. Yeah, it just seems like, I don't know, they're just in a position to, their growth is just in a position just for, I don't know, upward trajectory, but it's going to be interesting to see how long that lasts. Yeah, I saw Meta added the most market cap in a single day last week.

It added over $200 billion to the market cap after their earnings because their earnings were so good, which is, as I said, the largest ever for a single stock. They added $200 billion in market cap value in a single day. So yeah, it'll be interesting to see, as you said, john, with still major earnings coming out over the next couple of weeks, how those earnings look compared to the analyst expectations. And then hopefully we continue to have a good run in the stock market. I know Mark Zuckerberg got a nice positive impact from the meta stock.

I saw, what, 700 million of dividend payout? Oh, yeah, because they announced dividends for the first time. So yeah, I think he's getting $700 million in dividends every year going forward just based on how much stock he owns. Obviously we have the Super bowl coming up here. Do you guys have any, what are your predictions for who's going to win?

Who do you want to win? I'm rooting for the 49 ers. I do think they're going to win. I think, like I said in previous episodes, they have the best coach in the NFL and a team that can run the ball like they can, I think, always ends up controlling the clock, dominating the line of scrimmage and winning and can kind of keep Mahomes at bay a little bit and I think that 49 ers have a great defense and they're going to come up with something to contain Mahomes and I hoping for all this we don't have to see any unnecessary r and b country singers celebrating after the game on Sunday night. That's good.

I think I'm actually going to root for the Chiefs. I don't know why they didn't really have any feelings towards the 49 ers, but here recently I think there's a little bit of a rivalry between the Eagles and the 49 ers. So I'm going to root for the Chiefs and hopefully I always like Andy Reed. Hopefully Andy Reed can get another Super bowl even though he already has two going to the Chiefs. But I think I'm going to root for the Chiefs.

I'm going to counter your comment, Sean here. I'm going to go with the Chiefs. I'm going to say I think having Andy Reid, who's probably the best offensive play caller in the NFL, bundle that up with mahomes. I'm going to go with the Chiefs. Being the Niners, we hope you enjoyed this episode of Coachable wealth, brought to you by Morton Brown Family wealth, an SEC registered investment advisor.

This podcast is designed for educational and informational purposes and not intended as investment advice. More information can be found at www.mortonbrownfw.com.