Saturday, January 17, 2009

WHAT’S THE BUZZ? TELL ME WHAT’S A HAPPENNIN’

* It is great when this kind of advice comes from a non-tax personal finance blog. In her post “Should You Trust Your Broker” at OUT OF DEBT CHRISTIAN (Restoring Your Finances and Your Faith) Kathryn advices, “Talk with your tax accountant before making any moves with your money. The broker may THINK he knows tax law but things could have changed. It is best to talk with the tax expert before making decisions that affect your taxes.” Remember - a stock broker is just a salesman who makes his/her living by selling. No sale - no income.

* Fellow twit, and fellow tax blogger, Michael Rozbruch “turned me on” to an article from the Washington Post titled, “Don’t Wait for Obama to Cut Your Taxes”. It provides some good advice and resources.

* The TAXGIRL does not take week-ends off (actually none of “us” do this time of the year). Last Saturday she provided a good answer to a common question in “Ask the taxgirl: 1099 for Closed Business”.

* Kelly answers another oft asked question in “Ask the taxgirl: Running As Fast As I Can”. Her correct answer points up another inequity in the Tax Code – another instance where the taxpayer must bend over. Income is reported on Page 1, increasing AGI, but related deductions claimed on Schedule A (lost to non-itemizers) as “miscellaneous” subject to the 2% of AGI exclusion. To be fair only excess hobby income should be reported on Page 1.
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And an aside about runners - I have never seen a runner with a smile on his/her face. They all look like they are in pain. Isn't walking, or riding a bike, a much better and safer form of exercise?
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* Joe Kristan of the ROTH AND COMPANY TAX UPDATE BLOG reports that “House Ways and Means Committee Chairman Charles Rangel has held on for a convincing victory in our 2008 Taxpayer of the Year voting”.

* From the “I couldn’t have said it better” file – Kay Bell said it all when she pointed out “From the get-go, the lack of oversight in administering the Troubled Asset Relief Program (TARP) has made every bailout handout a very unfunny, and egregiously costly, joke. And since Congress opened up the bailout door so wide, then who's to stop any legal business form seeking relief?” in her post “Next In Bailout Line: Porn” at DON’T MESS WITH TAXES.

* Kay has also provides a good basic overview of the many educational tax benefits that are available in her post “Rags, Riches and College Costs

* TAXPROF Paul Caron quotes from the Wall Street Journal to tell us “Obama Plans to Keep Estate Tax” -

President-elect Barack Obama and congressional leaders plan to move soon to block the estate tax from disappearing in 2010.

Under the Obama plan detailed during the campaign, the estate tax would be locked in permanently at the rate and exemption levels that took effect this year. That would exempt estates of $3.5 million -- $7 million for couples -- from any taxation
.”

*Jeff Rose provides a good answer to ”Reader Question #4- Can I Take a Tax Loss on My Kids 529 Plans?” over at GOOD FINANCIAL CENTS (Helping you make “cents” of your investments).

Jeff smartly ends his answer with, “be sure to speak with your tax advisor just to make sure”.

* An AccountantsWorld.com article reports “Americans Failing Taxes 101”.

A survey by of all people The Tax Institute at H&R Block indicates that “most can't answer even the most basic tax questions correctly . . . the majority doesn't know a credit from a deduction”. Duh! Hey – it seems that many Americans have something in common with H+R Block tax preparers!

*WebCPA reports that “IRS May Expand Enforcement During Tax Processing” and pay closer attention to returns claiming the Child and Dependent Care Credit and Earned Income Credit while in the course of the initial processing of returns.

* The weekly NATP member email newsletter reports-

The IRS has announced that victims of the severe storms and flooding on December 10, 2008, in the city and county of Honolulu, have more time to make tax payments and file returns. As a result, the IRS is postponing certain deadlines for taxpayers who reside or have a business in the disaster area until February 9, 2009. The postponement applies to return filing, tax payment, and certain other time-sensitive acts otherwise due between December 10, 2008, and February 9, 2009.”

* We have a winner – actually two. Peter Pappas of THE TAX LAWYER’S BLOG reports the results of his online poll in “Worst Tax Cheat Poll Results Final: Kiss Your Sister, We Have a Tie”.

* It appears that BO’s proposed economic “stimulus” package will include some individual tax breaks - Among them, according to the press release by Charles Rangel for the House Ways & Means Committee, the following:

· refundable tax credit of $500 per worker/$1000 per couple (up to $200,000 income)
· expansion of EITC
· expansion of child tax credit
· simplification of education credits and making the credit partially refundable
· turning the $7,500 loan for first time home buyers during 2008 into a subsidy (no repayment requirement)
· increased expensing for businesses
· increased bonus depreciation for businesses
· increased (5-year) carryback of net operating losses for businesses
· "prospective" repeal of Treasury's illegal section 382 ruling (Notice 2008-83).
· annual one-year AMT fix {I added this to list – rdf}

More and expanded refundable credits – great! The mouths of tax-fraud scammers are most certainly watering.

I will provide more information when available.

TTFN

1 comment:

jj999 said...

I hope Congress doesn't let the Estate Tax go back into effect. There is no reason to tax anyone that heavily, especially when it can have such negative effects on small- and medium-sized family-owned businesses. With the economy in a poor state, and with even the most optimistic estimates for the recovery saying it won't be a quick process, I think we need to do what we can to help those businesses. They have always been the engine that helps drive job creation. The Estate Tax would really stifle that. I encourage everyone to contact their Congressional representative to tell them to repeal the Estate Tax permanently. If you want to see what it can truly cost, I noticed that the Friends of the U.S. Chamber of Commerce has a Estate Tax calculator up that will let everyone see the staggering impact of it. Here's the link - http://www.friendsoftheuschamber.com/email/email4.cfm?id=193