../../../..//2008/01/19/more-audits-for-all-says/
More audits for all, says the IRS! Especially the rich. 1 out of every 11 millionaires was audited in 2007. The rest of us earning less than $100,000 had only a 1 in 100 chance of receiving the Torquemada treatment. [Mercury News]
Are you totally clueless about your taxes? Don’t worry, the government is here to help! The IRS puts out a 300-page document called Publication 17. It can serve as a getting started guide for doing your taxes and answer questions like what to do when you have a baby, retire, or sell stock. Pub 17 also covers some of the new changes in store for 2008, like the expiring capital gains tax, IRA deduction increases, changes to child’s investment income, and ever so much more. No, you don’t have to read the whole darn thing. It’s a PDF so you can search for specific keywords and phrases. If you’re doing your taxes yourself and have some basic questions you need answering, Pub 17 is a good place to start.
It looks like Bush’s economic stimulus package is going to take the form of instant cash bonuses: $800 for individuals and $1600 for married couples. That’s dumb, everyone should get Costco coupons! All kidding aside, the NYT says the ~$500 rebates granted after the 2001 recessions proved “surprisingly effective…people spent most of the money rather than salting it away in savings or using it to pay down credit card debt. A 2004 study by economists at the Department of Labor, Princeton University, and the University of Pennsylvania found that households spent between 20 and 40 percent of the rebate within three months and another third in the following three months.” Will this “wealth surge” be just what the countries needs to beat back the forces of recession holed up in our economy, terrorizing our financial well-being? Bring on Operation Cash Dump.
I saw a big billboard for Jackson Hewitt showing a broadly smiling woman of indeterminate ethnicity holding a fistful of money that she just got by getting a refund anticipation loan, and it reminded me of how we need to do our annual telling of people to once again stay away from said refund anticipation loans.
Here they are, the final two mistakes in Sasha’s top-five screw-ups over at Consumerism Commentary. Mistake #4, “Failing to Balance Rental Property Income with Deductible Expenses,” is a bit specialized, although it contains a good lesson that can be applied to other situations. It’s the final entry, however, that applies to pretty much everyone (we’ve suffered from it ourselves in the past): “Failing to Remain Competitive Within My Field.”
../../../..//2008/01/10/if-youre-looking-to-invest/
If you’re looking to invest in mutual funds and avoid capital gains tax, Vanguard Tax Managed International Fund (VTMGX) and Third Avenue Value Fund (TAVFX) are recommended as funds to look into, along with index funds and ETFs (exchange traded funds) in general. [WSJ]
Kevin sent in this ad for H&R Block trying to market to college kids by giving them $10 in “pizza cash” if you file through H&R Block. This sounds tasty, except that due to their low income, most college kids won’t have to pay any taxes and it’s pretty easy to do with FreeFile through the IRS.gov website, for free, natch. But file through H&R Block and you’ll probably be paying at least $60. So, you could buy yourself $10 of pizza, or pay $50+ for H&R Block pizza. They still teach math in college, right?
If you paid on student loans last year, don’t forget that you can deduct the interest paid up to $2,500 as long as your parents don’t claim you as a dependent, writes Kiplinger. “You can deduct up to $2,500 in student-loan interest paid in 2007 if your income for the year was $55,000 or less if single, or $110,000 or less if married filing jointly.” If you make under $70k single or $140k married, you can still take a partial deduction.
Sasha over at Consumerism Commentary is actually working on a list of five stupid mistakes from last year, but she’s uploading them one at a time and we’re getting tired of waiting. We’ll post a quicklink or something to the remaining two in a few days. Anyway, here are mistakes one through three, another person’s financial self-flogging in public for your edification, or grim enjoyment.
Now is a good time to clean out your folders and files of unneeded paperwork, while still making sure you’re holding on to the tax records that you need to. Real Simple has a great chart that will tell you exactly what to keep and what to toss, split into whether you should toss an item every month, after one year, seven years, or keep forever. In addition, this Kiplinger article goes into the reasons why it’s important to keep some records for the specified period of time. The exercise will also help you get your papers in order for the upcoming tax season, which, as we’ve started seeing ads for tax prep software, is now upon us.
Today represents your final opportunity to donate money to charity for tax year 2007! CharityNavigator has some tips for holiday giving, and of course, you’ll want to brush up on the tax implications of your generosity.
../../../..//2007/12/21/sprint-to-pay-522m-in/
Sprint to pay $52.2M in back taxes to several towns in Missouri. [CNNMoney]
Today, Congress approved a one-year postponement of the Alternative Minimum Tax, which is good news for an estimated 25 million Americans (mostly middle-class) who would have qualified for it this year. The IRS said that due to the last-minute nature of the change, some refunds may be delayed: “Changes in the tax code require substantial work, especially in reprogramming I.R.S. computers.” The IRS says that “within 72 hours it would post on its Web site revisions to a dozen forms affected by the change.”
“We are getting calls from people who are saying that they used some kind of an electronic software program to file their tax returns and that they did not check the box to donate their kicker,” said Rosemary Hardin, a spokeswoman for the Oregon Department of Revenue. “When we bring up their tax return, that box is checked.”
Canadians are heading to the U.S. to do their shopping—and are leaving their old clothes behind in order to avoid paying a duty when they cross back into Canada.
Kiplinger’s idea of a good Christmas present for a teenager is helping them start a retirement account. We kind of think the average teen is going to have a hard time understanding why that’s a “better” gift than, say, a game system, but the underlying idea is sound. As long as your teen worked at some point in 2007—even babysitting counts—he can open a Roth IRA. But other people (that means you) can fund it, up to the amount the kid earned in wages.
It’s not as sexy a topic as dog treats, but it’s an important one: tax planning mistakes. More specifically, how to avoid some of the most common ones. Kiplinger lists 11 frequent mistakes you should be aware of if you don’t want an unpleasant surprise come April.
../../../..//2007/12/07/more-end-of-the-year/
More end of the year tax tips, this time from Bankrate. [Bankrate]
Part of 
