Some taxes are more avoidable than others

IRS Increases Criminal Investigations of Tax Return Preparers

Taxpayers Advised to Use Care in Selecting Preparers

 Another case of the classic “If it sounds too good to be true…”

This is exactly how special tax breaks find their way into our laws in the sausage factory that is our capitol. Plus the fact that none of our rulers ever actually read any of the tax bills before voting on them makes it very easy to slip all kinds of junk in there. As I’ve said on several occasions, this is also the best business investment possible in terms of profitability. Congress-critters routinely sell billion dollar tax breaks for just a few hundred thousand dollars of campaign contributions (aka bribes).

Having It Both Ways

I’ve written a lot about states taxing income earned inside their borders by non-residents; what some call the jock-tax because of the many states in which professional athletes earn income.  When an athlete, or anyone else, has their main tax home in a taxable state, their home state normally gives them a credit for the income taxes they have to pay to the other states in order to avoid two state income taxes on the same income.  This obviously doesn’t apply to people whose main tax home is in a tax free state, such as Nevada, Texas, Florida or Washington.

While I have never been hesitant to point out how ruthless the tax collectors of the PRC are in squeezing money from every source possible, it seems that Illinois is taking things to an even higher level.  They are making the ridiculous claim that Sammy Sosa is not entitled to an offsetting credit against his Illinois tax for the taxes he has to pay to other states on the same income he reports on his Illinois tax return.  This is completely unfair and I’m glad to see that Sosa is contesting it. 

Illinois is just like all other states, requiring people who don’t live there to pay Illinois tax on income earned there.  In fact, I have a number of clients for whom I do prepare Illinois non-resident income tax returns for income that is generated up there.  However, their home states do allow them the offsetting credit for the Illinois tax.  Illinois should be grateful Sammy Sosa hasn’t done what many other professional athletes and entertainers have done, establishing their official tax homes in Florida.  After being treated like this, I hope Sosa and his fellow athletes teach Illinois  a lesson and relocate.  That will end up costing Illinois much more than the Other State tax credit they want to deny Sosa.

KMK

 

Unfortunately, it doesn’t work this way with our friends at the IRS.

They dictate that we have an end at least every 12 months, with plenty of deadlines.

On State Tax Policy, Everyone Has a Formula for Reform

In the PRC, reform generally means higher taxes.

Survivor Assistance

Since I last discussed Mark Colgan’s very useful Survivor Assistance Handbook, he has prepared a new revised edition. My copy of the new version just arrived yesterday and it is very impressive. Mark has definitely made an already excellent reference work even more so. The additional information is even easier to locate, with a much more comprehensive index. Taking care of things after someone passes away is something most of us will have to deal with. Every household should have a copy of this book.

KMK

Articles Related to Nonprofit Law

Interesting information on how charities are supposed to work.

QuickBooks Help

The official QuickBooks website makes it a bit difficult to find local advisors, so I have added a direct link to that page on my website. Even if you’re going to be doing the work yourself, it pays to get some professional help in setting up things properly. I’ve had to spend a lot of very expensive time straightening up QuickBooks for people who should really have used some professional help at the beginning.

Buying Royalty

Since the USA has only one officially acknowledged royal family, and not everyone is fortunate enough to be descended from an Irish-American bootlegger and stock swindler, it seems like there would be a ready market here in the States for this company that sells British titles to anyone anywhere. I have no idea how useful being declared a Lord or Baron can be in real life, this at least sounds more satisfying than naming a star or buying a plot of land on the moon.