“Ah, how good it feels! The hand of an old friend.” – Henry Wadsworth Longfellow
A loophole big enough to drive Robert D. Flach through – New proposed regulations on the requirements for preparers to e-file tax returns will be good news for hand-prepared return holdouts like blogger/preparer Robert D. Flach. The regulations appear to require paper-preparers to e-file only if they will be actually mailing the tax returns.
Waiver to e-File. – Yesterday the IRS released Notice 2010-85 with the proposed rules for a tax return preparer to get a waiver from e-filing. In November of 2009, Congress mandated preparers to electronically file their client’s returns if they prepare over 10 returns. The IRS decided to phase this in and for 2010, the rules apply to preparers who file over 100 returns. In 2011, the threshold is down to 10. The IRS has developed two kinds of exemptions and finally released the details and procedures for requesting a waiver.
Chocolate: Good News. Bad News. Tax News? – Several news stories during the past few weeks have inspired me to write about chocolate, . . . .
. . . . It’s disappointing how lawyers and tax practitioners can make something as wonderful as chocolate the focal point of legal arguments and tax debate.
THE WANDERING TAX PRO: TAX HISTORY – 1643, 1861, 1872, 1894, 1895, 1913, 1916, 1917, 1918, 1922, 1932, 1935, 1941, 1942-1945, 1953, 1954, 1961, 1964, 1970, 1972, 1974, 1975, 1979, 1981, 1984, 1986, 1987, 1990, 1993, 1998, 2001, 2003.
Lock ‘em In. – the best post of the week, and by far the best idea I have heard.
Oprah, cars and taxes … again!
Tax Consequences of Oprah’s Latest Car Giveaway – One of the highlights of my income tax course is the hilarious 5-minute video of Jon Stewart’s Daily Show segment on the tax consequences of Oprah’s 2004 giveaway of Pontiacs to her studio audience:
Oprah was back at it last week, giving away to her studio audience a 2012 VW Beetle, a $1,000 Nordstrom gift card, an iPad, and a limited edition Oprah 25th anniversary watch from Phillip Stein encrusted with 58 hand-set diamonds, among other things:
Oprah apparently learned her lesson from the 2004 tax fiasco, with Volkswagen and Oprah agreeing to pick up her audience members’ tax bills:
House approves extension of middle-class tax cuts in symbolic vote – Here’s today’s not news flash. The House this afternoon wasted dwindling legislative time voted 234 to 188 for legislation to extend some of the expiring Bush tax cuts.
The bill now goes to the Senate where it will die.
I need to get some of these back into my Quotes; SPEAKING OF TAXES
How to Lower Your Heating Bills This Winter – The chilly season is upon us. If you live in North America, you’ve probably had at least a few cold nights by now. Up in my neck of the woods — in the Boston area — we’ve had our central heat running for a few weeks. Which means we’re in full swing winterizing, with an eye to keeping the heating bills low.
15 Year End Tax Deductions To Remember Unless You Want To Give The IRS a Tax Free Loan – As the year draws to a close it’s always a good idea to review your tax situation and in light of that, we have put together a collection of fifteen tax deductions worth considering to lower your overall tax bill. But act soon, because if you wait until next year to evaluate your current tax status, it may be too late to qualify for some of these widely available tax credits and deductions.
Should you pay off credit cards with a home equity line of credit?
Your tax accountant can make or lose you more money than any person in your life, with the possible exception of your kids ~ Harvey Mackay
3 Unconventional Investment Moves to Make in 2011 – All of us know about conventional investment movements once they become popular. In the late 90s, it was stocks. In the mid-2000s, it was real estate. Some are now saying that the next hot trend is gold. Riding these trends can be highly profitable, if you get in at the right time.
The problem with following trends is that the easy money is usually made before the trend gets very popular, and once the trend becomes more about popularity than about investing fundamentals, and more about buying in the hopes of flipping on the investment to a greater fool than about buying based on fundamentals, then that might be a sign that things are getting dangerous
Corporate Tax: there is no good or evil. There are only incentives, and those too weak to lobby for them. – Ultimately, I think the only real measure of a tax avoidance strategy is whether it’s legal, not whether it’s consistent with the “spirit” of the law, whatever that is. The whole notion of the law’s “spirit” assumes that tax loopholes appeared in the law by accident. As opposed to being secreted there deliberately by well-paid lobbyists and their congressional allies. Often, the spirit of the law is tax avoidance, not tax payment.
2011 STANDARD MILEAGE ALLOWANCES – The Internal Revenue Service today issued the optional standard mileage rates that are used to calculate the deduction for business, medical, moving, and charitable use of an automobile in 2011.
The middle-class tax hike nobody’s talking about – Are you ready to give up $30 a month?
That’s what may come out of your paycheck if — as expected — the Making Work Pay tax credit expires at the end of the year.
The credit was enacted last year as part of the Recovery Act to put more cash in people’s pockets. For the past two years, it has boosted paychecks by up to $400 for single filers and $800 for joint filers by reducing the tax withheld and giving a credit for that amount. That’s $33 or $67 a month.
Being Bad to Customers is Bad Business – This is a must read.
CPAs & Financial Planners / Relationship Growth – Many CPAs are taking a more holistic approach with their clients and their financial needs. The number of CPAs that are performing financial planning for clients is growing. Currently the PFS (Personal Financial Specialist) designation afforded only to CPAs by the AICPA is growing by about 5% a year. Many clients who don’t have a financial planner do have CPAs, and they trust them with their money. From what I have seen, there are positives and negatives to this.
Low interest rates on savings accounts at least mean less taxes -
College a necessity? – . . . the price of college cannot keep going up at the rate it’s been going up. It has gone up exponentially while people’s incomes have not, college costs have outpaced inflation. At the rate it’s going up tuition at a private university will hit $100k in less than 20 years. Who really can afford it?
Saving Money From the Comfort of Your Living Room – Before online shopping became popular, you’d have to patiently sift through the Sunday newspaper to find the latest coupons or drive out to the stores to see if they had any ongoing coupon promotions. Those days are now behind us as it’s possible to get the best online coupon deals to save money from the comfort of your living room.
Building Credit From Scratch – Are Young Adults Doomed for Financial Failure? – Young adults are faced with a unique set of challenges that cause many to struggle with credit. Inexperience, school loans, social pressures, and financial optimism all lead down the path of least resistance – a really bad credit score. However, it’s important to remember that there are long-term consequences of bad credit, and restraint today can pay off big time down the road.
Six year-end financial tasks – Here are a few tasks that are worth doing to tie a financial bow on 2010:
Notice Gives Guidance on In-Plan Roth Rollovers – On Friday, the IRS issued guidance on how plan participants can make rollovers from a 401(k) or 403(b) plan to a designated Roth account in the same plan (Notice 2010-84). Such in-plan Roth rollovers are now permitted under IRC § 402A(c)(4), as amended by the Small Business Jobs Act of 2010, effective for distributions made after Sept. 27, 2010.
Living off of Cash, Not Credit? – I’ve been weighing the pros and cons of using credit cards and wanted to see what you guys think on the subject.
Durbin Says U.S. Debate to Go Beyond Bush Tax Cuts – Senator Dick Durbin of Illinois, the senate’s No. 2 Democrat, said negotiations over extending the Bush-era tax cuts also will include prolonging emergency unemployment benefits and other tax credits.
Substantiation rules for out of pocket charitable expenses?
Online Sales Changing the Tax Game – Forty-five states rely on sales taxes on goods and services as part of their annual state budgets; the exceptions are Alaska, Delaware, Montana, New Hampshire and Oregon. Rates range from 4% to 8.25% at the state level, with local additions boosting rates to over 10% in some municipalities. That should translate into a combined boost of over $1 billion in sales taxes for those states that do charge sales taxes — not a bad haul by any standards.
However, state and local governments shouldn’t start spending those dollars yet.
The Impact of Zero Years – Remember when we talked about how your Social Security Benefit is calculated? Your highest 35 earning years during your career are put into a formula, and the earnings are indexed, then averaged by dividing the result by 420, the number of months in 35 years. And if you have less than 35 years of earnings, those years become zeros…
10 Steps to Small-Business Success in 2011 – Economists say the Great Recession–the longest and deepest since World War II–ended 18 months ago and that the U.S. economy is, in fact, growing again. But growth is relative. Even the rosiest economic forecasts for 2011 come in well under 3 percent growth. Unemployment is still high, and consumer spending is still sluggish.
That doesn’t mean sit and wait for things to improve. Rather, retool for the economy that exists today, and will be lingering for many tomorrows. Here are 10 places to start.
Lost, Harry Potter, and Accounting
Year-End Tax Planning in 2010 – The Wall Street Journal has a good summary of some year-end tax planning issues and strategies given the uncertainties about federal tax liabilities in 2011. Two of the points are of particular interest: capital gains/losses and 401(k) conversions.
CBO: Trends in Federal Tax Revenues and Rates
Smart Year-End Tax Moves for Investors – There are plenty of reasons for taxpayers to scream. Here it is, year-end tax-planning time, when investors must decide whether to take gains or harvest losses and make important retirement-account choices. Yet crucial questions remain—not only about next year’s tax law but also about this year’s.
Business owners, this one should make you re-think. Making Room for Reflection Is a Strategic Imperative.
Texas CPAs suggest toys that teach children about saving, budgeting, investing – With many people facing challenging financial situations and an economy desperately trying to rebound, the Texas Society of Certified Public Accountants (TSCPA) believes this holiday season is the perfect time for children to learn the importance of money-mindedness with affordable toys and board games that won’t break the bank.
Four Key questions to Ask Yourself Before Starting a Small Business – If you have always wanted to start a small business, you are not alone, the majority of working adults have thought about starting their own business but most simply don’t follow through because they don’t know how.
IRS commissioner chides Congress for its delay in dealing with expired taxes – The Bush tax cuts that expire Dec. 31“Marcia, Marcia, Marcia” of tax legislation. Everyone is fixated on what individual income tax rates will be in 2011. But more pressing, says the head of the Internal Revenue Service, are the laws that have already been stricken from the tax code. Lawmakers swear they’ll get to the lapsed tax laws. And I’m sure they will. Eventually. But it’s the precise timing of reinstated tax laws that could pose big problems for the IRS and, in turn, for us taxpayers. are the
Getting Tax Breaks from Paying for College – even if you’ve shelled out a ton of money for college, the government does help out a little. Several tax deductions and credits can save you years of payments.
6 tax breaks that anyone can claim – Tax deductions and credits aren’t just for big companies and finance-savvy folks. Look over the list below; you might be surprised how many tax breaks — in the form of both credits and deductions — can be applied to your tax return.
Your New Little Tax Deduction! – Having your first child is an exciting time in your life and I’d like to congratulate you on the birth of your newborn. Along with the rest of the changes this new responsibility brings there are also many parts of the tax code that will impact you financially.
Billionaire Warren Buffet Says the IRS Should Raise Your Taxes! – Well…maybe not your taxes, unless your among the wealthy taxpayers (most of whom fully support the Bush Tax Cuts for obvious reasons). In contrast to most, Warren Buffet fully supports letting Bush Tax Cuts for upper-income taxpayers expire.
Do The Wealthy WANT Tax Cuts? – According to this Philadelphia Inquirer article, “more than 400 U.S. business owners and professionals signed a petition [more here]” asking Congress and the Administration to let the Bush tax cuts for the wealthy expire. Some of the thoughts expressed by several of the people who signed the petition mesh with arguments I have been advancing for the past several years.
What to Consider When Giving a Holiday Bonus – Holiday bonuses can go a long way to making employees happy, but this year’s cash or gift will set the stage for next year’s. Here’s what to consider when choosing a holiday bonus.
End of Year Tax Tips for Investors -
Got liquid assets like mutual funds or planning to buy them? Your investments will need some tending before the year comes to an end to make sure you’re following a good tax strategy. Congress’ indecision on tax rates is making this a particularly tricky year.
WHAT’S THE BUZZ? TELL ME WHAT’S A HAPPENNIN’
BlogRoll Beans Early Snowfall Edition
Just a reminder, you can go to my company web site Tax Center page where you’ll find this year I have a Free Tax Organizer. You’ll need a .pdf reader to open this 14 page organizer. You can also find my Online Tax Organizer, used mostly by clients and/or those who will be clients.
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