Tax Guru – Ker$tetter Letter

Helping real people win the tax game.

Archive for January 29th, 2003

Posted by taxguru on January 29, 2003

Financialphobia

How is it that they have an officially recognized disease in England for fear of finances? I always thought we here in the USA lead the world in stupid made up disorders. Who are the ambulance chasing lawyers going to sue on behalf of these sufferers?

KMK

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Posted by taxguru on January 29, 2003

Not A Slam Dunk

According to Bruce Bartlett, a change in the membership of Bush’s economic advisory team may make it more difficult to keep up the push for eliminating the double taxes on corporate profits in the face of the left’s class warfare. It will be a very tough sell to a country with almost no understanding of how a capitalist economy is supposed to function.

A caller to the Limbaugh show the other day was whining at how unfair it would be if his neighbor’s dividend income were tax free while he had to pay taxes on his carpentry income. The caller was completely oblivious to the fact that such dividends represent income that has already been taxed at the corporate level and forcing the shareholder to pay a second tax would be the truly unfair thing. I have a hunch that such ignorance is more widespread than is healthy. So; don’t start counting on tax free dividends just yet.

KMK

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Posted by taxguru on January 29, 2003

Section 179 Expensing Election

It seems like a lot of people were not aware of the ability to claim the very lucrative Section 179 expensing election for business vehicles weighing more than 6,000 pounds. It’s only been the law since 1984; so it takes a while to filter out into the tax practitioner community.

I have had some people asking about going back and claiming it for past years. Unfortunately, that isn’t possible. As with many tax return elections, they can only be made on original tax returns or on amended ones that are filed by the due date (including extensions) of the original return. That kind of thing is the reason that it has always been my policy to file tax returns late rather than rush something together that can’t be changed, such as the Section 179 election. I still have several 1999, 2000 and 2001 tax returns in process.

KMK

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Posted by taxguru on January 29, 2003

9-Digit ‘Social’ Overused as ID

It’s good that they are finally realizing how dangerous it is to use SSNs for too many thing. However, for most people, it will be like putting toothpaste back in the tube in regard to getting control over their private SSNs. In spite of the claim on the SS card that it is “Not For Identification,” it has become the de facto personal ID for almost everything. Filing Form SS-4 and obtaining a new IRS ID number may be the only way anyone can have any serious level of control over who has access to their personal ID.

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Posted by taxguru on January 29, 2003

Accelerated tax cuts receive support

As I said in 2001 when everyone was proclaiming this to be a huge tax cut, it’s always a stupid idea to spread tax changes out over a long multi-year schedule. If reduced rates are a good idea ten years from now, they are an even better idea right now. A phased-in reduction is also always open to modification or freeze, as many of the DemonRats are still trying to do with the 2001 law.

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