Income tax 2022-2023, itemized deductions, home mortgage interest, get ready and some coffee so we could stave off the government attack with income tax preparation. Well, maybe we can't stave them off, but we could at least, we could slow them down a little bit, I think. Most of this information can be found in the instructions for Schedule A Taxure 2023, which you could find on the IRS website at iris.gov, iris.gov. Looking at the income tax formula, we're focused on what I would call the below the line deductions. More specifically, the itemized deductions, remembering the first half of the income tax formula is basically a funny income statement. Most income statements having income minus expenses resulting in net income, here having income minus various deductions resulting in taxable income. Remembering deductions for taxes are good, therefore we're typically looking for more of them. One of the major differences between the types of deductions include the fact that the adjustments to income or above the line deductions do not typically need to clear a hurdle such as the standard deduction before they are beneficial to the taxpayer, whereas the itemized deductions do typically need to clear the hurdle of the standard deduction before they become beneficial. First page of the form 1040, we're looking at line 12, the greater of the standard deduction or itemized deduction. If the itemized deductions are greater, then we would be populating them on the Schedule A. The Schedule A are the itemized deductions. The list of the deductions are on the left, although this is not the whole schedule. These are the standard deductions, the hurdles that we would have to clear in order to be itemizing, which are tied greatly to the filing status such as single married filing joint or head of household. Single filing status has a standard deduction 13, 8, 50, married filing joint, doubling that to 27,700, head of household in between 20,800. If they are older than a certain age or blind, then we have single filers could have one or two of those items, which would increase the standard deduction as we can see on the right. Married filing joint would have four separate items that could apply because there's two people involved, the standard deductions on the right, and so on. So we're going to be continuing on with the interest, looking here more specifically at the mortgage interest, remembering the general idea of an income tax would typically be, to be fair, we would tax the net income, meaning we would be allowing deductions for those types of things that were necessary in order to generate the income, which we can see clearly on, say, a Schedule C for a business income, which is an income statement where we have income minus expenses, which are basically business deductions and are applying the tax rate to the net income, not to the gross income. With W2 income, then the idea is that the employer is providing the expenses, and therefore we're not writing off the expenses. The Schedule A has a bunch of items on it that deviate from that general idea for various different reasons that you can argue, whether they be valid or not. But the idea now is that we have some of these personal items that you would think personal in nature and therefore wouldn't be natural deductions for an income tax, but are included nonetheless in the code, things like charitable deductions where they're trying to nudge us to give to charity, because they don't think we would if otherwise or something like that, it seems kind of insulting to me. I don't know. But then we have, of course, the mortgage interest. Now, the interest, you would think that if we took out a loan for purchase of equipment that we used in a business, the rent on the equipment would be a normal business expense. But we also get the personal purchase of the home and the mortgage interest on the home, possibly to be deductible, the argument being that owning a home is like the American dream was the argument and so on. I would think a large part of that was also lobbyists within the housing industry that wanted to subsidize the housing industry, which they did quite well with that, which probably increased the housing prices and made it a little bit more complicated in the long run to decide whether or not you can afford a home. But that's first a word from our sponsor. Yeah, actually, we're sponsoring ourselves on this one because apparently the merchandisers, they don't want to be seen with us.  Like this CPA thinking cap, for example. CPA thinking, CAP, you see what we did with the letters. And this CPA thinking cap is not just for CPAs either. Anyone can and should have at least one possibly multiple CPA thinking caps. Why? Because based on our scientific survey of five people, all of whom directly profit from the sale of these CPA thinking caps, wearing this CPA thinking cap without a doubt, according to the survey, increases accounting productivity tenfold. Yeah, at least. Apparently the hat actually channels like accounting energy from the quantum field ether directly into your head, allowing you to navigate spreadsheets faster. It's kind of like how in like the matrix when Neo learns kung fu, or at least that's what the scientific survey is saying. So get one because the scientific survey participants could really use some extra cash. If you would like a commercial free experience, consider subscribing to our website at accountinginstruction.com or accountinginstruction.thinkific.com. That's kind of where we are at this point in time. So when we look at the deduction of interest, the mortgage interest is going to be the big one. That's going to be the one if someone owns a home that might push people over from taking the standard deduction to the itemized deduction, especially when you combine the mortgage interest with the property taxes that are state and local taxes, which also might be itemized deductions. So let's get into the weeds of the mortgage interest tip. So if you are a homeowner who received assistance under a state housing finance agency hardest hit fund program or a emergency homeowners loan program, you can see publication 530 for the amount you can deduct from the online 8A and 8B. So oftentimes when you get into the purchase of the home, you can get into government incentivized areas where they're trying to help people to afford a home and so on and so forth. And then you get into these questions as to whether or not if you've got some kind of benefit, then should you also get the tax deduction, right? You get these overlaps that end up happening and things can get quite complex relatively quickly. So a home mortgage is any loan that is secured by your main home or second home regardless of how the loan is labeled. So when we think about a home loan for most people, the home is going to be their largest investment typically. So that means most people have one home in order to be purchasing the home. They're going to have to take out a loan or mortgage and then in order to finance the loan or mortgage, they're going to be paying interest. The interest is the thing that is going to be deductible. Notice here, we also have a second home. So you would think that would be more beneficial for more wealthy individuals who could have two homes. And then of course, if we have the loans on the two homes, that could be a significant amount as well. So it includes first and second mortgages. So when we take out a loan, oftentimes when we purchase the home, we're going to take out a loan on it to be paying for the purchase price of the loan. We could take out a second, which could happen for various types of reasons. But in essence, we have two loans. Typically when you think of it from the banking side of things, the bank wants to lend you money and they want to assure that you pay the money back. They're going to be obviously earning interest. The way that they assure that is they use the loan as collateral so that if you default on the loan, they can go after the home and they don't want to do that typically because they just want to be collecting their interest, but they have the threat of being able to do that is the general idea. What if you have two loans outstanding? Well, then you might have one bank that has the primary recourse of the value of the home if it was to be taken and sold, and then the second one has the secondary recourse. So you would think that you would have less favorable rates, for example, on the second than the primary because they might not have as favorable, the bank might not have as favorable terms in terms of the collateral. So first and second home equity loans and refinanced mortgages. So what's a refinanced situation? If you have a home and you've got a loan on it, then at a future point in time, the interest rates on the market are going to change. So if the interest rates become lower on the market than what you purchase on the home, you might want to then refinance the home so that you can basically take out a new loan and basically restructure the loan. You can kind of think of it that way, hopefully getting a more favorable rate, which of course costs something to do to process that through, but then possibly you can lock down more favorable rates that hopefully you can have for a longer period of time. And then so you end up in the same kind of situation where you have your home, you've got a loan with it, and you have the collateral of the home to back up the loan and you have interest on it that might be deductible. A home can be a house, condominium, cooperative, mobile home, boat or similar property. So when you think about what qualifies as a home, it's pretty wide. There's a pretty wide range of items that qualify as a home. So it must provide basic living accommodations, including sleeping space, toilet and cooking facilities. So those are probably the ones you're going to be looking at if you're living in just basically, you know, something, a boat or something like that and it doesn't have like a bathroom in it, then that's one of the things that you know you would think might disqualify it as a home. So check the box on line eight if you had one or more home mortgages in 2023 with an outstanding balance and you don't use all of your home mortgage proceeds from those loans to buy, build or substantially improve your home. So now we get into the issue of what did you use the proceeds of the loan for and this gets somewhat complex. Normally when you buy a home, you're going to take out a loan just to be purchasing the home and so then you would think that that type of loan would be deductible because that's what the government is trying to basically incentivize people to be able to afford a home as long as it's not, if it's in within a reasonable range you would think they might put a cap on that. However, from the bank's standpoint, you can imagine they don't really care what you spend the money on as long as they have the recourse of the home as collateral. That's how it would generally be if there weren't like regulations involved and so on. But if you take out a loan and then you use it not to improve the home or purchase the home but rather to buy a car or to go on vacation then you would think that's not the goal of the IRS. That's not what they're trying to basically be incentivizing and that of course could lead to complications. So interest paid on a home mortgage proceeds used for other purposes isn't deductible on line 8A or 8B. So see limits on home mortgage interest later for more information about what interest you can include on lines 8A and 8B. Now note that this could cause kind of issues when people are doing personal finance and they're trying to consolidate their loans. In other words, the home loan is one of the loans, the best loan to basically have as collateral sometimes because it would be at least if you can deduct the interest. So some people when they have a lot of credit card debt or if you have a lot of a car loan and other types of loans then one strategy from a financial statement perspective or just a personal finance perspective would say let's see if we can consolidate some of those loans get rid of those high interest rates on the credit card and the car payments and so on and possibly see if we can use the home as collateral so that that collateral might allow us to get lower interest rates because the lender is more secured in that case. But when you use that strategy it's going to complicate things because you might not be using again the proceeds of the loan for the purchase or improvement of the home. So then you have questions about the deductibility so that could come up from a tax standpoint when you're doing the tax return and from a personal finance standpoint when you're trying to think about how to free up cash to do whatever you need to do or possibly in consolidating debts to try to take advantage of lower interest rates for example, TIP. You used any home mortgage proceeds for a business or investment purpose interest you paid that is allocable to those proceeds may still be deductible as business or investment expense elsewhere on your return. So if we took out the loan so you could imagine a situation where you're saying I need money to start my Schedule C business that I'm going to report on the Schedule C I need to take out a business loan. What's the bank going to say? The bank is going to say I need collateral in order for me to do that. If you have business assets like equipment that might work as collateral which would make sense because those are assets of the business and you're using the loan for the business but as long as the bank has recourse they don't really care you would think in theory if it was a personal asset in other words if you say I need a business loan I'm going to put my home up as collateral on the business loan then the bank as long as the bank is confident that you're going to repay the loan and if not have the backup of being able to take the collateral the home you would think that they still would want to basically give the loan but although the home is collateral you didn't use the money for the purchase of the home or improvement of it so you would think it might not be deductible on the schedule A however you are using the proceeds for business purposes and therefore even though it's a personal collateral you would think you might be able to take the interest as you would a normal kind of situation from an income tax system as a business expense because you needed the loan to purchase like equipment in order to generate revenue in the future which is something that you would think would be naturally deductible from an income tax perspective but not on the schedule A possibly on like a schedule C or other business area limits on home mortgage interest so what are the limits? your deduction for home mortgage interest is subject to a number of limits so if one or more of the following limits applies you can see publication 936 to figure your deduction so once we get into these limits once they go into play the question is do these limits apply number one and then number two if they do then we got to get into the calculations to see how we are going to calculate the deductible part so limit for loan proceeds not used to buy, build, or substantially improve your home that's what you would think the IRS is trying to incentivize at least in theory because they are subsidizing the home builder market right so they want the loan proceeds to be used to buy, build or improve the home so you can only deduct home mortgage interest to the extent that the loan proceeds from your home mortgage are used to buy, build or substantially improve the home the home securing the loan so you took out the loan using the home as collateral and then you have to use those proceeds to do to buy, build, or improve the home for deductibility because that's why the IRS is having you deduct them in theory the bank doesn't care or wouldn't care right in theory they just care that you can go to Hawaii and go on a vacation and whatever as long as the bank feels secure that you can pay back the loan and they have the recourse if you don't of the the home so that's where it gets a little bit tricky so the fact that you have the home collateral in other words doesn't necessarily mean that you qualify because you might have used the proceeds for something other than the buy, build, or improve so make sure to check the box on line 8 if you had one or more mortgages in 2023 with an outstanding balance and you didn't use all the loan proceeds to buy, build, or substantially improve so the only exception to this limit is for loans taken out on or before October 13th 1987 so they changed the law which is some ways back at this point in time but loans could be quite long quite long in duration so this is one of those areas that once they changed the law it becomes difficult because like I say I would argue that the home mortgage interest probably should not have been in there I don't think it should have been in there in the first place because it is a personal item and all you did was subsidize the home prices which increased the price of the home making it more complex for people to purchase a home without I think really providing value in the long term because the market is just going to adjust for that but once you have put it in place and people have made a 30 year investment based on the structure of the tax code it becomes very difficult to take it out because now you're going to be harming the people that made their investments based on the tax code so what you end up with is having these laws that say I'm going to fix it from this point going forward and then if you were there under the prior law then it still possibly applies in that way so the loan proceeds for these loans are treated as having been used to buy, build or substantially improve the home you can see publication 936 for more information about loans taken out on or before October 13th 1987 you can see publication 936 to figure your deduction if you must check the box on line 8 so if you have to check that box then the question is how do I figure how much of the interest is deductible and you would think that you would do some kind of ratio calculation in other words what's the portion of the loan that you used for the buying, building or improving of the home versus for refinancing your debt or for whatever going on vacation or whatever to help to determine which part of the interest that ratio then you would multiply possibly by the interest amount on the loan because remember what you're going to get is a 1098 and the 1098 isn't, is going to give you the amount of interest that you paid but it's not going to be breaking out the deductible portion versus the non deductible portion based on what you used the loan proceeds for because the bank isn't responsible to oversee what you used the loan proceeds for typically that's not their job the IRS hasn't forced them to do that yet so then you're going to have to take that number on the 1098 and then apply it out or allocate it in accordance to how the loan proceeds were used possibly using some kind of ratio percentage allocation which you can go to the 936 publication for more detail limit on loans taken out on or before December 15th 2017 so this is a ways back for qualified debt taken out on or before December 15th 2017 you can only deduct home mortgage interest up to $1 million $500,000 if you are married filing separately of that debt so note that these limitations are they are pretty high right because again this is a deduction they claim is aimed at everybody being able to own a home but the fact that you have multiple homes that are qualified for which most people don't have like normal people and and they have these pretty high amounts this is not the cost of the home here $1 million we're not talking about the cost of the home we're talking about the loan on the home so in other words usually if you buy a home it used to be that you put 20% down at least right so you put a cash substantial cash amount down and the difference would be the amount that you paid would be the amount that you are going to pay with a loan by taking out a loan okay so the only exception is for loans taken out on or before October 13th 1987 you could see publication 936 for more information about loans taken out on or before October 13th 1987 you could see publication 936 to figure your deduction if you have loans taken out on or before December 15th 2017 that exceed $1 million $500,000 if you are married filing separately so now the question is is the loan over the cap that we're allowed to take and remember that what you're going to get is a 1098 which is the interest taken within the year so then the question is how am I going to figure out if that were the case which it isn't normally that's a pretty high amount but how am I going to figure out if that was the case the deductible portion which again you might have to use some kind of ratio calculation you would expect so limit on loans taken out after December 15th 2017 okay so for qualifying debt taken out after December 15th 2017 you can only deduct home mortgage interest on interest on up to $750,000 $375,000 if you are married filing separately so typically if a married couple has the choice of either filing married filing joint married filing separate can't typically go back to single or head of household unless separated or divorced and typically you're beneficial to file married filing joint normally so if you also have qualifying debt subject to the $1 million limitation discussed under limit on loans taken out on or before December 15th 2017 earlier the $750,000 limit for debt taken out after December 15th 2017 is reduced by the amount of your qualifying debt subject to the $1 million limit and exception exists for certain loans taken out after December 15th 2017 but before April 1st 2018 so in general like going forward this would be the rule that's probably most relevant in your mind because you might have questions about people that are going to be purchasing a home or something like that and the deductibility of the interest noting that anytime someone is thinking about planning situations you're really going to want to use the software to actually run real projections to see what the tax implications are because they do get complex so let's read this top one one more time your qualifying debt taken out after December 15th 2017 can only deduct home mortgage interest on up to $750,000 $375,000 if you are married filing separately of that debt so it's still a pretty high number if you are talking about the cost of the home you might have still bought a million dollar home and then normally you would put a down payment usually it used to be like 20% and the difference is going to be basically the loan amount which still if you bought that that would be a high loan for a large very expensive place if you are not living in California where I am at you might have home purchases or 300,000 or 200,000 or something like that you put the 20% down so again pretty decent limit for average people in America notice that this is another problem by the way with trying to put down a blanket kind of rule like this about purchasing homes over the entire country because it's way more expensive to buy homes in say California for example or New York then many other types of the areas of the country so it's hard to say what would be a fair deduction and again I think they are getting into the weeds of this getting on the personal side of things that actually causes more problems but in any case if the exception applies your loan may be treated in the same manner as a loan taken out on or before December 15, 2017 you can see publication 936 for more information about this exception see publication 936 to figure your deduction if you have loans taken out after October 13, 1987 that exceed the 750,000 375,000 if you are married filing separately ok so then we got the limit when loans exceed the fair market value of the home so if the total amount of all mortgages is more than the fair market value of the home you can see publication 936 to figure your deduction again you would think this wouldn't typically happen because normally if banks are not influenced by some weird regulations and whatnot then they are not going to want to allow the value of the home to be less than the loan value so if you think about if you are a bank and you are going to give out a loan you want to make interest on the loan then if they have $100,000 home with their purchasing that's the purchase price you are going to say something like I want you to put 20% down where I am not going to give you the loan and I am going to use the loan as collateral so that if you default on the payments I can then take the property not because I want it but because I want to sell the property to recoup the loan value that's going to be the idea but if you give 100% loans meaning the home is worth 100,000 and you loan them 100,000 what's going to happen if the value of the loan goes down you can see everything gets messed up because then the people that own the home are saying hey look I am paying a higher price on the loan then is the value of the home there is an incentive for them to abandon the home basically go bankrupt kind of thing and so that doesn't usually happen that's what happened in the housing crisis like 2008 and that's because there were these crazy incentives that were basically manipulating the market in various ways and the banks were taking on large risks but normally that shouldn't happen because if you have a 20% cushion when you purchase the home it's not likely then the market is going to decrease that large of an amount but it could if that happens then you could have a limitation as well okay line 8a enter on line 8a mortgage interest and points reported to you on form 1098 so notice 1098 is different than a 1099 the 1099 represents income typically that you might have received and therefore have to report IRS has the same document so you have to double check that the 1098 is going to be reporting and it's kind of a different situation where the usually when it's income note the incentive to the IRS was they want to go to the person that is paying because they get the deduction right they're going to get a deduction so they want then them to rat out who they gave the money to so that they can make sure that the other guy reports income that's what a 1099 is that's what a W2 is therefore what we have is interest which might be a deduction for us but because it's such a large and significant deduction they're going to put pressure on the big financial institutions the banks that have the loans to actually report not only to us but to the IRS the amount of mortgage interest on the form 1098 so that of course if we report something different than what's on the 1098 we might question us about it and we have to basically kind of justify or show why what we're reporting is different than what's on the 1098 for example typically so unless one or more of the limits on home mortgage interest apply to you so for more information about this limit see limit on home mortgage interest earlier so we've got the home mortgage interest limited so if your home mortgage interest deduction is limited then go to the publication 936 to figure the amount of mortgage interest and points reported to you on form 1098 that are deductible so usually it's pretty straightforward hopefully they're not limited if they are then it's going to get more complex and you can go to the publication to do that calculation or help you with it I only enter on line 8A the deductible mortgage interest on form 1098 refund of overpaid interest if your form 1098 shows any refund of overpaid interest don't reduce your deduction for the refund instead see the instructions for schedule 1 form 1040 line 8Z so this I believe is going to be a similar situation to like what we saw with the state income taxes in other words what happens next year you paid interest and you got a deduction for it in 2022 but for some reason it was wrong you overpaid it and then they gave you a refund in 2023 that means you over deducted in 2022 so should you go back to 2022 amend the return well that would be kind of tedious so I believe the idea would be no we're not going to do that well what do I do then do I reduce in 2023 because of the refund to make up for it that would make sense but the iris is typically going to say no that's not the way we want to do it because it's possible that you sold the home and you don't have any mortgage interest or you're not itemizing in 2023 so what would you do in that case instead like with the state tax refund if that happens you might have to report it in income as other income so similar kind of situation that's fairly unusual to happen because typically the bank's going to get it right with that 1098 but same concept and you can see it's been repeated multiple times if you get the situation with a refund and you're like oh no I have to amend the prior return or oh no I have to adjust the deduction in the current return the answer is probably no you have to see if you got a benefit from it last year and if so compensate for it in the current year by possibly including it in income and above the line like schedule one income so more than one borrower so if you and at least one other person other than your spouse if you file a joint return reliable for and paid interest on a mortgage that was your home you can only deduct your share of the interest so shared interest reported on your form 1098 so if the shared interest was reported on the form 1098 and you received deduct only your share of the interest online 8a so you can imagine a situation where you have a 1098 reporting the interest but you are only allocated a portion of it that's basically your portion well you can only deduct like your portion of it would be the idea let each of the other borrowers know what their share is shared interest reported on someone else's form 1098 so here's where it gets messy so if the shared interest was reported on the other person's form 1098 report your share of the interest online 8b as explained online 8b later so notice that if someone else is getting the 1098 and it's a shared situation and part of that interest should be deductible on your return that's kind of a risky situation you would rather not structure the loan that way typically because the form 1098 is not only going to you but to the IRS so it's so if you report mortgage interest that you don't have a 1098 for it might not be wrong but it could cause more complication so you want to make sure that you do that carefully and I would think through thoroughly if you're talking about how you're going to structure the loan and use that as a last resort but that could happen in some situations form 1098 doesn't show all interest paid so if you paid more interest to the recipient then is showing on form 1098 include the larger deductible amount online 8a and explain the difference so clearly the IRS has the 1098 with a large financial institution you would think that they would get it right get the right number but sometimes you might have other financing other than with large institutions and what not and something they might get it wrong so what do you do well you have to report the correct number you're going to report the correct number and then try to give the notes to the IRS to tell them what happened because the IRS has the number and if you don't give any explanation reporting something different reporting something greater than what's on the 1098 you can expect that they will probably question that so if you are filing a paper return explain the difference by attaching a statement to your paper return and printing quote see attached in quote to the right of the line 8a I think you can do that electronically now too you can fight you can basically say I'm going to attach an addendum a statement which would be like a PDF file to the to the line 8b if you paid home mortgage interest to a recipient who didn't provide you a form 1098 report your deductible mortgage interest on line 8b hopefully that doesn't that's not as common as an occurrence because again you can expect the IRS is going to question that more because they didn't get their 1098 from the financial institution which would give you more verification and support that you have a legitimate deduction so your deductible mortgage interest may be less than what you paid if one or more mortgage interest is applied to you so for more information about these limits see limits on home mortgage interest earlier seller financed mortgage so this is kind of a special type of scenario where the mortgage structure is going to be a little bit different noting that usually if you buy a home what happens is the person selling the home is going to sell the home let's say it's $100,000 home but they have 20,000 on it that they're paying well usually you're going to get a loan to help you to get the 100,000 that you pay to them they're going to take the money and then pay off the 20,000 of their loan and keep the 80,000 and go on their way but you can imagine a situation where you have a different kind of financing structure like a seller financed mortgage so if you paid home mortgage interest to the person from whom you bought the home and that person didn't provide you a form 1098 write that person's name identifying number social security number and address on the dotted lines next to line 8B so if the recipient of your home mortgage payments is an individual the identification number is their social security number SSN otherwise it is the employer identification number the EIN you must also let the recipient know your social security number interest reported on someone else's form 1098 so if you at least one other person other than your spouse is filing jointly reliable for and paid interest on the mortgage and the home mortgage interest paid was reported on the other person's form 1098 identify the name and address of the person or persons who received a form 1098 reporting the interest you paid so now someone else got the 1098 you're going to report it because some of it's allocated to you you want to tell the IRS who got the 1098 so the IRS can still kind of verify it with that 1098 again you would like to avoid that structure of a loan if possible because it's likely to cause confusion don't want to confuse the IRS they cause problems when you do so if you are filing a paper return identify the person by attaching a statement to your paper return and printing see attached to the right of line 8b you might be able to do that in software again as well depending on the software so line 8c points not reported on form 1098 so points are shown on your settlement statement points you paid only to borrow money are generally deductible over the life of the loan so points become a whole nother kind of situation because sometimes there's different terms of what a point actually means so there's that becomes a problem and then the question is well if you're paying points and we're considering the points we're thinking of the points as a prepayment of like a payment of the interest like a prepayment of the interest do I get to deduct the interest at the point in time I pay the points and the IRS argument might be possibly no because you're paying the interest before you've earned it that would be like prepaying the rent or something like that so they might then force you to put the points on the books and kind of like depreciate them which would be the easiest form of depreciating would be basically just taking the points that you got to deduct and deducting an even amount over the life of the loan so if it was a 30 year loan deducting an even amount which usually comes out to a pretty small amount each year of points that possibly can be deductible so questions that come up with points are one are they deductible two if they are deductible did the mortgage company or the financing company put it on the 1098 and then three how do I treat the points are they something that I can deduct in the current period or are they something that I can't deduct or are they something that I'm going to have to depreciate put on the books basically as like a capital asset or an amortizable asset that I'll then expense over the life of the loan possibly using a straight line method although in some cases you might have to use a more complicated method that's a simplified method of straight line which usually will work over the life of the loan which would be like 15 to 30 years is the general idea if they didn't report the points on the 1098 you might have to look at the closing document so if someone purchased a home they're going to have the closing document and you might have to scan through the closing document to make sure that there's a proper allocation of the points and then treat the points accordingly now obviously this is only something that's usually a problem when the home was first purchased where you have to comb over possibly the purchase documentation the closing document after that everything should roll smoothly because you'll get the 1098s which should be properly recorded after that and if you had to record the points on the books and amortize them over the life of the loan you would have done that in the year of purchase and if you're using the same software the amortization should hopefully work and properly calculate in future periods any case see publication 936 to figure the amount the amount you can deduct points paid for other purposes such as for lender services aren't deductible so refinancing generally you must deduct points you paid to refinance a mortgage over the life of the loan this is true even if the new mortgage is secured by your main home so similar situation except this time you had a loan you want to refinance the loan possibly because there are more favorable interest rates on the market than your current interest rate which could result in another kind of closing document similar but much more simple than when you purchase the home which could result in more points which you generally are going to have to basically amortize over the life of the loan so if you use part of the proceeds to improve your main home you may be able to deduct the part of the points related to the improvement in the year paid so in that case you can take a look at publication 936 for more details there tip so if you paid off a mortgage early deduct any remaining points and the year you paid off the mortgage let's say you have the points on the books there's a 15 year loan you've been deducting the points every year for 15 years however now you're going to pay off the loan early they're saying I'm just going to pay it off I've got the money I'm going to pay it off well I still have the points that are still scheduled to be deducted over 15 years because the loan is being paid off now you would think that you would be able to deduct the points at the time that you're paying off the loan however if you refinance your mortgage with the same lender see mortgage ending early in publication 936 for an exception so now you have a situation where you're paying off the loan but you're taking out another loan so do you get to deduct the points of the loans if you're paying off the loan but then you're just refinancing taking out another loan or possibly do you have to take those points and keep on amortizing them possibly to the life of the new loan or to the life of the old loan you know whichever short or something like that if that's a situation you can take a look at publication 936


Cut Cut Where is the cut? That's a hot mug guy Hey guys a little special video here I had a gentleman by the name of Nicholas Michael Jacobs Email me asking me if I wanted to give his film night a little show to the little watch before I give my thoughts of the film I'll just say this Nicholas is a recent graduate of the Philadelphia high school for creative and performing arts, and this is his first feature film now I'm gonna give him credit for this any kid any one teenager or whatever making their first film. That's always a feat Trying to do a short is already a challenge But doing a full-length feature you Are off the task of not only creating a film that is that long but having enough content to fill it and It's just him and this girl Alexis Pete Alexis Beecher I believe her name is commendable to the both of them definitely good for them for making a film such as this Now my thoughts on it. Oh my god. Where's the cut? I have to admit within the first five minutes I was screaming at the computer screen cut Ha admit once the film gets going which unfortunately takes a little bit of time The concept is an interesting idea the girl is kidnapped by this kidnapper this Kind of psychopath and what he does is he live streams for an execution basically, but it's not a straight-up execution What happens first is there's a bidding war sort of on this black chat and people bid or give money to the kidnapper to do certain amount of things to the girl and It's all bidding and money and whatnot in the conversation that he's having with this chat Like he's he's kind of saying what the chat group is saying and he does the ax on her that aspect is very cool And it would have been better as a short I'm just gonna be straight up honest with us. This film has no right to be this long for instance the first three or five minutes is of Nothing he has the lens cap on you can hear that he's getting ready to go out and do his thing and He's like or here we go, and then he's following the girl for what fell like I think it was literally three minutes, and that's probably the biggest criticism. I'll give to you Nicholas is that You need to cut you need to work on your pacing I will say that straight up this film was long. It was far too long it would work great as a short film and Yes, I know you're limited to what you do So I just find it odd that you went with a feature length film rather than a short because a short would have worked much better Really, there's only two scenes in this whole film is the camera in the room pointing at the girl And then the camera out on the street otherwise it is just that it's Almost 50 minutes of this camera pointed in one direction never moving and yes some of the dialogue with the chatters is kind of interesting Yes, it is however It is very dull when you have almost nothing going on and Admittedly, I know you guys are teenagers I know you guys are teenagers But I would have maybe gone with a little bit more direction for Alexis because there's some There's some rough line rates. I'm not going to point them out. I'm not gonna run through that But there are some parts that really needed to probably be done again Yes, a very cool idea and again an impressive effort to both of you for making this film and to everyone who worked on it But I just my main criticism is that this definitely needed to be a short instead of a feature It did not have enough necessary content to be as long as it is I'm not gonna give this film a review like I usually do with recommendations I'm just gonna say check the film out if you want it comes out tomorrow Which would be March the 23rd on Amazon? It's a cool idea definitely from people who enjoy these kind of psychological horror films or kidnapper murder stories, but I'm just telling you now you're in for a very long long ride Anyways guys, I hope you liked this video if you did leave a like and if you're interested in more maybe subscribe Otherwise good luck to you Nicholas. Congratulations on finishing your film And I hope the best for you in your further films and your further projects. Anyways, see you guys next time Thanks for watching the video. You're probably wondering who I am My name is Nitz and you might remember me from the animated cult classic TV show undergrads It's been a while, but I'm happy to say the click is finally getting back together in an all-new movie Thanks to a successful Kickstarter campaign, but we are still asking for your support You know Nitz you can't get more money unless you offer questionable favors Yeah, unless of course those favors involve the ladies guy by support. I mean getting the word out guys Oh, well, couldn't you find it better means than this guy? All he seems to talk about is supernatural or hold a coffee mug real awkward Why didn't you ask a Kardashian or something? Yeah guy, get in with the ladies guy. Hey, he's trying to help out Like you've been trying with Kimmy Burton. I've seen job of the hut finish a marathon faster. Yeah guy You're a massive slug thing guy To see any and all updates about the upcoming undergrads movie be sure to check out and like the bring back undergrads Facebook page And with any luck, we'll see you guys soon


Hey guys, Shaber1000 here. Today we're going to be checking out this old welder. It's a Thunderbolt, it's a Miller welder. It's old. They're going to stretch these cables out and see what's up with the cables. This thing, this is how you would turn your power up by cranking that. Okay, so let's get started and see if this thing's going to work or not. Guys, so like I said, this is a Miller Thunderbolt. My glass is on. There's some numbers on it. This thing has been taken apart and repainted. The bottom's kind of rusty on it. I don't know why I had you zoomed in, but there's a gauge thing. Like I said, this is a little crank up.  Or down if you wanted less power. Okay, so I had a, well it's been several years ago. My early 20s, I had a Lincoln welder. It was bigger than that, but it had to crank on front. And it's kind of rounded on the top, on wheels. I don't know if that works or not. That was her dad's. But I see he's put a new cord on it. And like I said, he took it apart and apparently painted it. I mean, I suppose he took it apart, but I can't see somebody doing all that. I mean, he had to at least have the back off of it to put the cord on. Can't see somebody doing all that if it didn't work unless he did it. And then it didn't work. And that's why he had to buy the blue one. I've got some welding rods over here. He's got a bunch more. I just grabbed a few. As you can see, I don't know how well they're going to weld. They've been sitting in the garage forever. We've got some 6013, 6010, 6011s. I like, just for the stuff I use, I like the 6013s seem to be a nice rod. Just for welding like go-kart frames or small trailers, like, you know, the one we're working on. So I thought I'd give it a shot. The first thing I'm going to do is stretch these cables out and see what we're dealing with. I see a lot of electrical tape. So they may be extension cords. Now the problem I'm going to have with that right now is I've got, the only 220 I've got in the garage is clear back in the back at the dryer. It does have the same, the same pigtails, what we call them, pigtails on it. But I do have, which would be a video, I would put it right at our box. My garage is a mess, guys. There's our box. And I could put the 220 right there for this welder. Then I can bring the welder over here or something. Once I get wire for the blue one, for the wire feed, I probably wouldn't use this one as much. Depending on how well it does weld. Okay, so let me get this, let me get this stretched out here in the driveway. And let's see what we're looking at. Make sure nothing's going to zap me too bad. Looks like he's got extensions on it. So I don't know if it'll, if they'll run clear through the, I wanted to work on the trailer today. So, I mean, I don't know if it'll run clear through the garage, if they're long enough to do that or not, we'll have to see. But let me get these stretched out first. Okay, guys, this is what we ended up with. All right, we've got all this onto our lead there. Then we've got the ground clamp. Thanks, those cables there look pretty good. This cable's kind of shaky, but it is really thick. So I definitely have enough to run it through the garage. I don't know if that's got enough. I mean, I may have to crank it way up, but I don't know if this has got enough to run all that or not. So I'm going to get it back there. I'm going to plug it in, I'm going to hook it up. I'm going to plug it in and turn it on and see what happens first. Then we'll hook it up and try to run a test weld and see. I don't like using that much lead, but I wouldn't have to once I get the plug in over there on that wall. So let me get this in the garage. It's very heavy. I think it's probably 80 pound minimum. So let me get it back there and let's see if it'll kick on. Hey guys, I get this plugged in where the dryer goes. Let's see what happens. Okay, it's running. I'm going to drag some leads in here. We're going to plug it in. We'll see. Let's try to run a test bead on something. I'll go get some steel out here and we'll see what happens. Dang tight. Okay. So I gave it a tap and it's got some spark to it. So let's see if we can weld something. Let me go turn it up a little bit. Okay, while we know it works, now I just got to play around with the setting. So I don't want to be burning through like that with the heat. Well, you don't really turn the heat up. You just turn the power up on it.  I'm going to clean this up. See if we can't get a nice weld. And if we can, then we'll start on the trailer. Still too hot. For what we're going to be using it for, it's not that great either, but you know, got it too hot. I'll just play around with it. Yes, it's still burning too hot for something like this. But as you can see, it does work. Let's see if we can maybe feel that little, yeah, see it's still way too hot. That's okay. I'll get it adjusted when we go to working on the trailer. Hey guys, so it does work. I know I can shorten this, the power. I can shorten that up and still have enough to come through the garage and do what I need to do. Ground I'm not worried about because it's a lot thicker. But you know, for building this a little old trailer, I think it's going to be fine. So, you know, that's what it is. Just no old miller welder. So it works. I mean, if I can get it to get the temperature right, I think I think that'll be a damn fine piece of equipment for as old as it is. Just to just weld some stuff together around here. I think it'd be all right. So all right guys, thanks for watching. Stay tuned for working on the trailer some more, getting some welding done on it. And this weekend, we're going to be doing a live stream. So keep an eye out for that video or details on it. So we'll let you know what day and everything. So all right guys, with that being said, I'm going to get off here. I'm going to drag some stuff over here for the trailer and we're going to get some of that welded up. So, shea bearer, the myth, the man of legend. I'm gone for now. Thanks again for watching. Bye-bye guys. Have a great week. Ain't the best yet, but it's getting there.


Life from New York, it's National Manufacturing Day. Hey everybody, it's me, Lady Aida. That's right, we are manufacturers and right now we are manufacturers. Why are you hearing all that noise? You're like, what's all that noise? Why aren't you in a sound studio? Why are you in a sound studio? Because we're in a factory where we do our manufacturing here in downtown Manhattan. It's also a Made in New York City week. And so we're making it a city and manufacturing, it's our day. Yeah, so let's go over this. This is a Made in New York City week. We are one of the partners, in addition to the New York City Council, Brooklyn Lightning Art, GMDC, Con Edison, WDI-8, and LISC NYC. This is Made in New York City week. Today is the first day that they're kicking it off, and it's Manufacturing Day. And I woke up today and I'm like, oh right, we're doing a virtual factory tour today. That's fine. What's funny, we used to do virtual factory tours for years, and people were like, why would you do virtual stuff? And it's like, I don't know, like why physically show up at a place when you can do it virtually? Yeah, and now it's just cool to do virtual stuff. So I thought I'd first start off with a little bit about it for the folks that are like, what do you mean you're a New York City manufacturer? What does that even mean? It was like, what part of New York City? And we're like, no, it's Manhattan. Manhattan. So this is our building. It's 150 Veric. It was a... Westinghouse radio inductor building. They used to manufacture radios and components for radios, which was a very big New York industry, and it's really cool. I wish there was a book about it, because I'd love to read the history of electronics and radio in New York. Yeah, I mean, if you know of someone who's working on or knows about the electronic history of New York City, send it to press at adifference.com. I'd love to check that out. Anyway, so this building was used for manufacturing, and then it became printing building. Yeah, and it still does some printing. Yeah, and Panavision is here. White and Kennedy, they're an advertising agency there here. And Adafruit has a few floors here, and this is our team pre-COVID, pre-COVID, pre-COVID, pre-COVID, pre-COVID. And we hope to... I mean, we could probably go outside and take a photo again, but this is right before COVID last year, and we started doing stuff, I'd say, in a bigger way once we got to this building, but Adafruit was in an apartment 10 years ago. Yeah. Actually, a little bit, maybe like six, seven years ago. And we went from an apartment, and that's where this picture came from, which is just by the way, that was your bedroom, I think. This was the living room. Yeah, and we had a little tiny pick-and-place machine, and we had a toaster oven that we did, reflow manufacturing on. Really nice toaster oven. Yeah. We have another one we still use. Yeah, and... For toast, literally. And no loans, no venture capital. You can check out our About Page if you want. In fact, I have some web page stuff here. Oh, I'm getting that. Yeah, that'll go to... Come on. And this is... Let me go to the page here. Sherry, Sherry. Yeah, so this is our About Page, Adafruit.com, slash about. And you can read a little bit about the company. You can see some of the things that we do here. More was the first lady engineer on the cover of Wired. You got a lot of stuff going on. And you can see, you know, we have this May New York City blurb here and more. And then the other thing is, it's Halloween, so we've got this little, you know, pumpkin. Yes. It's manufacturing day. And this is one of the many things we do. We try to do something every single year and more. And if you want... Oh, we have little quotes on our page. We have our thing that we just got. We're now a minority of women-owned business enterprise. That's pretty cool. You have to get, like, a piece of paper to get certified. Yeah, it has not really helped us at all, but since we're the only ones that are out there... Well, I think it's good to show, like, there are women and minorities who have manufacturing business. If you don't see it, you can't imagine it. Yes, this is the real thing. And so that's why we decided to do that. Another thing, and this is just because it's manufacturing week, or sorry, yeah, manufacturing week in May New York City Day, if you're a company and you're looking for people, we have a jobs board that the two of us will approve each job. Yes, it's a free job board. It's a great place to get a job or to hire people. We only let through, like, non-sucky jobs, nose-to-nose spam, they're all wheel. And so, like, for example, Stanley, Black and Decker, they want EEs and IoT engineers. It could be remote or whatever. If you do content, did you keep looking for somebody to create an electronics content? So I'm going to talk a little bit more about Adafruit in a second. But the other thing is, like I said, it's Manure City Week, October 1st to 9th, and today is National Manufacturing Day. And if you go to the website, it's maidennyc.org, you can see other companies in New York City that are manufacturing tomorrow. There's some physical events. And all of New York, you know, we're recovering. The city is doing, I think, better than expected. I can tell you, on the ground it is, I think, in a lot of reasons. It's Lockwood. Lockwood looks cool. Lockwood. It looks really smart. Williamsburg Manure City. And I think it's one of the reasons is all of the safety that New York City companies have been able to provide to their staff and the community. The vaccination rate is really high here, and we haven't had any cases, and our team is right now 99% vaccinated and will be 100% by October 18th. That's going to be our mandate. So I do want to let the folks know that they're watching this that are running companies. It is possible to thrive and do a good job manufacturing New York City, even in the middle of a pandemic, chip shortage, and then today we heard, you know, a chunk of the world right now is running out of power. Yeah. So some things are closed. So you can check that out there. And then also, this is just a different color one. This is the creatorswanted.org. This is the National Association of Manufacturing. We're a member of it.  This is, and more, this is our little page here, where it has this event that you're watching now. So that's a little bit about what's going on today. But I did want to talk about, like, what have we been doing, and then we'll do a little bit of a tour. So one of the things that happened in the last year is we got asked to make face shields. This was March of last year. The city called us and said, we really need face shields for doctors. Can you drop everything and do this?  And we decided to do it. We have all these posters around here. We wanted to help fight COVID. And then here's some of the doctors that got the face shields that we made. And then here's just a little speed-up snippet of how we were making them and how we were doing things in the mid-last year. And we were able to deliver thousands to the city. And it was because we had all this technology here for doing other things. But it turns out you can make masks as well. And so we're thankful we were able to do that. We also, with our manufacturing capabilities, were able to provide electronics for ventilators for all sorts of medical devices. And it's one of those things where it was hard to do. There was only a small team of us. We didn't make any money on any of this. It was just like, let's do whatever we can to keep everyone as safe and alive as possible during one of the scariest times. So I want to thank our team. We took some portraits during this time because we were all just trying to figure out how do we operate as an essential business and how do we do things? And stay safe. And we did. It was really, really, really, really hard. So thank you, team. And thank you, everyone here at Adafruit, who's been holding it together. And we're at a finish line right now. And like I said, it has a lot to do with. It's easier and safer to operate. Yes. So yay. So a couple of things that we're going to do in this half an hour or so that we have together is we have a live camera here at Adafruit. But we're going to... Live. Because it is a virtual tour. Oh. Yeah. So enjoy the wires. OK. So let me get... OK. This is us. We're in the background right there. You can't see us. This is us. This is us live manufacturing right now. The team knows I'm doing this too. We're like privacy freaks here. Yeah. You can tell them. I'm like, hey, we're going to be doing this. Let's see if I can zoom in a little bit. Let's do it. So there's Andy and Hector. And they're manufacturing electronics right here, live in New York City. But what I wanted to do is have LeMore, our lady here, an engineer, talk about this manufacturing floor here. Yeah. This is a pre-recorded video, but I wanted to have someone go through and show all of it to do a virtual tour. So here you go. OK. So this is the beginning of the pick-and-place lines. This is like the heart of Adafruit. This is where we actually manufacture electronics by placing components onto circuit boards. And then this long thing here is an oven that heats it up. On the right there are testers that we use to test boards. And those are completed boards that came out of the pick-and-place. They're toasted and ready to use. We also have a machine called the selective soldering machine, which actually can solder through-hole components. It's a very different process. We have storage for all of our components and testers. These are the desks where people sit, and they test each board. So every board that we manufacture is tested. This is me. I'm working. I'm waving. OK. And then you can see we have a lot of storage. We have no radio shack sign. A lot of manufacturing is inventory management, making sure you have all the parts that you think you have at the time you think you have them. A lot of our space is taken up by component storage. Parts that we use in all of our products we have to purchase. And they come on reels that we then load onto the machine. And each board we have has a different set of reels that we load on. Yeah. OK. So let's go back to us. And then the other part of the tour I thought we could do is let's take a look at our shipping and our storage. It's like a GoPro. There's a, yeah. I feel like it's one of those like bicycle things. It is. Like indoor cycling. And they're like you're bicycling around the city. Yeah. You're bicycling around Adafruit. So this is our shipping area here. Yeah. Back in the day. The Moore Wiz electronics and Kidding and I was shipping. There was just two of us. I did all the shipping. She did all the electronics. So do you want to talk about this or do you want me to? No. This is where we store all of our stuff to ship. So we have about 4,000-ish products that we ship from here. About, you know, 500 of them are manufactured on site. And then the rest are stuff like, you know, batteries or enclosures or other makers. We like to stock stuff from other people in the community. We stock stuff like Raspberry Pis and Arduinos and boards from SparkFun and boards from Seed Studio. So there's a large community of about like 20 different companies that make electronics that we sell. So, you know, we like to sell those as well. And so we have like a kind of a one-stop shop. And we sort every item with product ID. So we kind of inventory management for shipping is also really important. But what's neat is that, you know, we try to stock enough stuff that you can really build a project using everything at Adafruit. And also we stock all the things that are kind of unique and unusual. Like, we don't like to stock like individual screws because you can just buy those at a local hardware store. Instead, we try to stock all the things that are kind of unique and interesting. So a lot of my time is spent, you know, looking at what is out there in industry and then getting samples, verifying that the things work as expected. Write an example code for them. And we take really nice photos, get specification sheets and put them up on the site. So it's kind of a curation process. We do manufacturing and curation. For inventory, you know, there has been kind of our backstop. You know, we try to stock about one quarter's worth of inventory. Right now there's this massive silicon shortage, which you probably heard of a lot of car companies are having to close up or they're unable to ship cars. So we use a lot of the same components and a lot of it is due to car companies. They're a massive mover in the industry. It's kind of like that story of, you know, when McDonald's wants to have the McRib, they can only do it when the pork prices are a certain amount. Because when McDonald's buys McRibs for every McDonald's, it has a huge effect on... Yeah, like Nutella is responsible for like a third of the... Oh, palm oil. Hazelnuts on planet Earth. Right. So, you know, we're kind of a small company and it's a very large ecosystem of companies like Apple and Ford and Toyota. But, you know, we try to have a niche there where we can still get and stock components and keep them on site so that we can manufacture goods for the next three months. But it's been interesting dealing with the silicon shortage. You know, it's definitely been challenging. I've seen, you know, there's stuff I would have like to get out and publish and I couldn't because, you know, I'm ready to go but then the part isn't available and the part isn't available for like up to a year sometimes. So, I thought what we would do is... So, that's a tour and a promise delivered. We wanted to do the virtual tour. Virtual tour done. But we also wanted to show some actual things that we're making here right now. So, do you want to show the tester? Well, I thought I'd show some of, you know, I thought I'd show what a circuit board looks like. I feel like once in a while I need to like cut to the manufacturing cam. They're cleaning up the tips.  So, anyways, we're making some stuff right now and you have some things that... Yeah. I want to tilt this so you can... Yeah, this is a little tilty. What is this? So, this is, these are the circuit boards. So, you know, when we, when you manufacture a product, we start with a circuit board design. So, this one is a four panel. You'll notice because there's one, two, three, four boards. Whenever we manufacture stuff, you know, you usually don't manufacture literally one at a time.  So, it's like as many as you can fit into this shape is however many you can make at once. So, this is a macro pad. So, this is a three by four keyboard with a rotary encoder and you've got like some cool space themed art. One of the things we like to do with our electronics is that you can, you have little Easter eggs or design elements that we can add because, you know, when we make a circuit board design, the thing that's like technically important is all the copper, all the gold pads and what they connect to you. And, you know, we of course do that and make sure we do a good job with that. But then there's all this leftover space. It's like, well, we could, we could add a little space man, space cat over here or like this is kind of a cool, you know, ship element, like rotating element over there. Sometimes, you know, on the final design of the board we also have a gold plated design. So, we like to play around with the process of making circuit boards. But I design a big circuit board. It goes through, you know, multiple revisions. I use CAD tool to do that. I use Eagle CAD, but there's also CAD CAD is a free and open source CAD software. The only reason I don't use CAD CAD is I can grow up with it and, you know, it's one of those like whatever you grow up with is kind of, it's like my native tongue. So, I use Eagle CAD, but there's tens of others. And then, you know, there's a lot of acronyms and like, you know, what is this like key cat thing? That doesn't really matter. Those are like tools of the trade for EEs that you solve for packages. But a couple of little other things that are interesting. So, on average, we create at least a new product about once a week. A new original product comes out once a week. At least, yeah, at least. And so, on Wednesday nights at eight o'clock we have a show called Ask an Engineer and we have a new product section. And that's when we show everything. We do live demos. We ship about 30,000 packages from here, New York City, USA. Who doesn't say it? Yeah, every month. Every month. Yeah. And we've always been profitable. And then, you know, you can look around online, I think one of the last times we were asked like, revenue $40 million in about a year. So, this is a business business. Yeah, we have 150 people almost all together and a lot of engineers on staff and developers and artists and people who do music and people who do photography. We have a puppet show and you can't see it behind me here because we've moved our cameras, but we have some puppets that we have do things with us as well. And then someone in the chat, by the way, if you want to ask any questions, you can do it on YouTube or Discord at YouTube today, probably because that's what most people are watching us on. Someone said, oh, like, is there any way to optimize our gathering and shipping because it looks like people are walking around. And the answer is we already do. So, or at least, you could always add more efficiency, but one of the things that we did is velocity storage. So, based on how frequently something is ordered or when we print out the invoices, the path for someone to take, if they walk to a place, all the things are available for them to pick up on the way there to get back. Yeah, like the order in which it appears on the invoice is the order in which you can walk. Where it is, yeah. Is that still true? Yeah. And so, all this shelf, we have shelf locations, now we have barcodes for everything. Back in the day, it was just me shipping. I have to remember everything and it was just in our living room, so not so bad. But now it's, you know, 50,000 square feet plus. And then we have about 3,000 resellers around the world. Digikey and Mauser are probably our two biggest ones if you like to order stuff from some of the larger customers. You know, you're up in Japan and Canada and the UK. Yeah, we ship worldwide except we're not allowed to or can't. And, you know, you could post some questions in the chat if you have anything, but back to the manufacturing. So what else have you been working on? So yeah, so this is the board before it's, this was the PCB, the raw PCB that we get. And then this is after it's gone through the pick and place. So that's actually the board that they're manufacturing. I just totally snagged this off of the end of the line. So you can see that whereas this has, you know, these blank gold pads, this version has components. So there's like a microcontroller here and a USB connector and a speaker, even says speaker and LEDs and sockets and, you know, other components that are placed on top on the pick and place and then heated in the oven to permanently attach them. You know, a lot of manufacturing is process management also. You know, what processes can you use and can you minimize the processes because especially with electronic manufacturing, some processes are very messy and expensive and time consuming and some are very fast and efficient. So pick and place is extremely fast and efficient. You really want to use the pick and place as much as possible. What you want to avoid is having human labor as much as possible because it's competitive and it's not as interesting and it's slow compared to this machine which can place, I think, you know, 60,000 components an hour or something. Yeah, and we have two of them. One of the things that we did was we said, well, you know, this is working out and if we can make enough money to save enough money, we can buy another machine in case one goes down or if we want to optimize our production. There's the oven. That's the thing on the right there. And then there's two pick and place machines, a board loader, a stenciler, there's Andy. He's one of the people who runs the machines here and then let me try to zoom in a little bit more to see if I want to see what I can do here. I've played with this camera in a bit. It's working. Yeah, so back in the day, we would put this whole setup on a cart and push it around, but I thought, you know what, I could probably just film it and then have something. But that's the machines right now. I think they're on break at the moment. And the next thing we have is you have a tester if you want to show it. Yeah, so the final step is after we manufacture stuff, we go through the test process. So building a test jig is also really important. You know, a lot of people when they learn welding or woodworking, they, you know, you start with thinking like, oh, I'm just going to use a saw and I'm going to like weld or use a CNC. And then you realize, actually 90% of your time is spent jigging, holding the thing into place and measuring it and getting it into the right setups that you can do the process that you want to do, whether it's lathing or milling or welding or soldering or, you know, drilling or whatever. And it's similar with electronics. You know, you spend a lot of time on the design of the product, but then you also have to design how to test it because the pick and place machines will place components, but depending on humidity and temperature and vibration, you know, we're over a subway and so there's sometimes the building shakes a little bit or just like random chance because we're dealing with small electronic components, things won't place in the right location. Sometimes humans make mistakes. We don't load the machine right. They flip something upside down. And so being able to detect errors very quickly is very, very important. I've definitely heard of people who didn't have a test procedure when they went to manufacturing because they're like, you know, what could possibly go wrong and then they get 5,000 boards back and they're all wrong. They're all upside down.  So it's really important to have a full test procedure. So this is a test jig. So this is also something I designed. This is a test holder which has test pads. It'll test points. When you look at electronics, you often have these little gold pads on them that are used to perform a test procedure. So then I clamp it down. I got this nice little clamp and then when I plug this in, so it loads a test program in and then, okay, you can clamp down properly and this is like it telling me what it's doing. So it says, okay, test all switches and then I have to test the rotary encoder. So I have to rotate this and you can see all the lights light up and it says, please push. I push this down and it says test pass and then, you know, it took 25 seconds to pass test. So a lot of my time is spent not only in the designing of the hardware, which is important, but how to perform the test procedure very quickly because the time to manufacture something is usually actually a lot less than the time it takes to test it. It takes longer to test an item than it does to manufacture an item. Not always, but for many electronic components because a human, again, a human is involved. Yes, you can automate that, but even then, it's very challenging. It's very, you know, a human has to lift a thing and move it. It's tough to automate that whereas a pick in place, you know, in an oven, those are well automated. A lot of people, they don't realize how much stuff we have is not automated. It's done by hand. Humans are really good at grasping things, moving them, pressing buttons. Looking at colors, looking at text and recognizing it. Recognizing when something is not being tested properly. It's the unknown unknowns that humans can be actually quite good at, that robots are not. And so each thing is tested by a human. So the key is, how do I make it as fast as possible to test? So, you know, in this case, it took me 25 seconds, but my goal is to make it 10 or 5 seconds or less. And then a couple questions that came in from the chat and I'll answer them. So they asked, do we have any, what do we do about e-waste? Well, we work with New York City and we deliver anything that we have that is considered e-waste. Here's one of the things. The most important thing is, if you do good designs. Yeah, we're really efficient. That have good yield, that's more important. I mean, when companies make phones like Apple and Samsung, the first ones, they throw away like 50 to 80 percent of their product. The yield is really low. The yield is quite low. You never see it and you never know about it because it's hidden. But for us, we have 99 percent yield 98 percent yield or higher. We're very, you know, it's not just, it's not just because we want to reduce e-waste but of course, we want to reduce our time, we want to reduce our effort. We don't have to, we don't want to rework stuff. So having good yield which comes from good design, good tests and good process will reduce your e-waste. That's more important. You solve the problem early. There's no real recycling in electronics. None.  It can be disposed safely but it's not recycled. I think as efficient as you are is the goal because if you're not throwing away anything and your yield is like 99, over 99 percent, which ours is, then... Yeah, you want to keep it out of the out of the recycle bin, out of the trash bin. That's more important than some fantasy of like, oh, I can make something and then I put it in the recycle bin and it's going to be recycled. And then the follow-up that they had was now they're talking about like, oh, do you have any examples of taking apart stuff and using those parts for things? So I would check out our learn system, Adafruit, learnsystemlearn.adafruit.com. Yeah, there's makers who do that. Yeah. You would not do that for a final product. Yeah. Nobody would want that anyways. Nobody would want it used. Yeah. We wouldn't take apart a TV and then turn it into something else. That being said though, there's a lot of components that people can use. Well, we couldn't anyway. A lot of older components have lead in them and we can't use them anyways. Yeah. So one of the things that folks can do with the Adafruit system, another thing that you could do is on our show and tell a couple weeks ago, we had Randy from Instructables and it was about how to make robots from basically junk. Yeah, that was fun. And so you might want to check that out because I think that has what you're looking for and a lot. Trashbots. And then you can take some of the things that are like out of an old toy and then add some like modern components from Adafruit. So this is learn.adafruit.com and it has pretty much every possible thing you might want to build with electronics and more. I mentioned we have a subscription service called Adabox if you want to get electronics delivered to you every three months. The Halloween one's coming up and go to adabox.com and check that out. It is, there is like less than 40 openings out of the thousands we have because we will run out of things. So for learn, I thought one of the things, let me go to learn. So just to give you an idea, here's a no code IoT door alarm. You can, HID, which you're like control devices. We have guides on understanding the differences of micro SD cards and micro SD cards and just a whole bunch of stuff how to use printers how to make these glasses how to do all sorts of lighting. Here's a cosplay, costuming thing. So we have quite a bit. Yeah. And then let me see if there's anything else. We have a couple, like one more minute. Yeah, one more minute. Oh, since someone said Adabox sounds interesting I'll just go there. So if you go to Adabox.com. We have like a couple slots left too, I think. Yeah. Someone's asking if we would do like classes or anything. So there's other people that do a really good job. First Robotics, of course, it's a kind of after school program. There's tons of maker spaces and hacker spaces and there's ones in Queens, ones in Staten Island, ones in Manhattan. One of the things that we like to do is publish. So people use our guides in these things. Having people in a workshop would be a different business. We want to keep making these things. So anyways, Adabox is here. You can check out the trailer of, we try to update all the time. You can see some of the past ones and more. And so far so good. The next one is probably shipping in another week-ish. Yeah. Back here and see if there's anything else before we go out. Do-do-do-do-do-do-do-do-do. I think we got to everything. We did. Okay, great. So right on time. Half an hour on the dot. Right on budget. That's right. That was your made in New York City week first thing of the made in New York City agenda. A great way to check out October. So, yeah, today was the virtual tour at Adaford Industries and there's a bunch of stuff in store for the entire week. Thanks for coming by virtually. And it's a manufacturing day. Yeah. And I hope that folks see us doing this and know anything is possible. Because that is one of the things we hear a lot like, what do you mean you're manufacturing in Manhattan? Yeah. And it turns out it does make sense. It is good financially to do. Lamar can design something and make it and test it all right here in a matter of days or weeks where when you do overseas manufacturing it's every single thing you do could be up to a month. And then if you add chip shortages and then if you add power electricity shortages in China you can't get stuff off the boat or get it off a boat right now? No, it's like you can't get stuff through the train system. You can't get stuff off the boat system. It is a good time to be manufacturing in the U.S. And we hope many, many, many other people do. And there's a safe way to do it. Yeah. We also know that COVID is still happening. A lot of folks aren't even returned to the office yet. We were in essential business so we had to check out adafruit.com buy something and support a New York City company and all of the people here and their 401Ks and their salaries and all the benefits that we have and tons of benefits that we have to have this is one of the best places to work. And if you're in New York City and you are looking for a job at a place like Adafruit you can always email employeeresources at adafruit.com This is our show for tonight. Thanks everybody. Thanks for coming by half an hour of a virtual tour and chit chat. Don't forget if you have more questions come by Ask Engineer every Wednesday Eastern on YouTube in our YouTube at 8 p.m. Yeah. Wednesday 8 p.m. Eastern Adafruit YouTube Okay. That was it. Thanks so much everybody here is your moment of zener so we don't