Coverage of the Tax Cut Bill Passed By The House

Boston Globe

Washington Post

New York Times

Los Angeles Times

There is still a lot of haggling to go on between the House and Senate versions.  When we get down to a bill that will become law, I will be discussing the ways in which people can exploit the new rules to their best advantage ASAP.  I have been working on several strategies that could save some serious money for people.  However, we need to see which version of the tax law makes it to Bush’s desk before deciding which plan is most practical. 

Bush Urges Americans to Demand Tax Cuts – This should be done all of the time, not just now.  Our rulers equate silence with assent; so if you don’t like how things are, you need to let them know or else they will assume that you are happy with everything. 

Quicken Tips

For those using Quicken, here is a good list of free sources of tips that are available on the web, courtesy of the Houston Chronicle.  I actually learned about this because they included a link to my tips.

Compared to some of the things people invest in (i.e. stocks, get rich quick schemes, slot machines, etc) this may be a safer way to go.

House Debates $550B Tax-Cutting Bill

Glenn Hubbard: We need you now – Help from former Whiter House economic advisor would be helpful in pushing for the Bush tax cut plan.

Panel OKs trimmed tax cut

House Passes $550 Billion Tax Cut Package

GOP Senators Endorse Tax Hikes

Mayor John V. Bloomberg
New York City stands on the brink of Lindsayesque catastrophe. – Amazing incompetence for someone who is supposedly a financial guru.  The cost of one-way U-Haul rentals will be shooting up soon.

Arkansas Tax increases become law – Nicotine addicts are looking at another 25 cents per pack and everyone is going to have a 3% additional income tax.  This extra income tax is supposed to only be for two years; but we all know that temporary taxes are rarely that.

Solons should tighten their own belts first

What is it with Arkansas legislators?  They’re in Little Rock raising taxes left and right in their search for enough money to keep state programs going, yet they’re not willing to make what’s basically a symbolic gesture by foregoing their $300 raises.

Pay More or Get Less? from Neil Cavuto

As this great tax debate continues, a question: Why is it when states and cities are running budget deficits, they invariably raise taxes? Why is that a given?

 

FTC Sues Web Sites Over Do-Not-Call Scam – Don’t fall for this scam and pay for something that can be done for free by checking with the FTC’s website.

Lawmakers wrestle with competing tax-cut plans

U.S. Senate panel set to pass compromise tax plan

Senate Lawmakers Debate Dividend Taxes

Snowe wins victory on tax-cut limit

The Daschle Republicans (Cont.) – aka RINOs

Senate Tax Cut Package Would Include Tax Increases

Analysis Deficit – As I’ve always said, the numbers being bandied about to describe the size of the tax cut are bogus, fabricated out of thin air with no foundation in reality.  They claim that lower tax rates cost the government money; when the truth is that lower rates generate much more revenue to the Treasury. 

As Bush Tax Plan Falters, Conservatives Find a Silver Lining – Lower capital gains tax rates would be a step in the right direction. 

GOP Senators Reach Tax Cut Pact

Senate Republicans Reach Deal on Dividend Tax Cut

GOP senators strike tax-cut bill agreement

GOP sets plan for dividend tax cut

Senate Panel Debates Dividend Tax Cut – As I predicted several months ago, the most likely outcome of the debate over taxation of dividends will be a certain nominal amount per year tax free per person; similar to the $100 per year of tax free dividends that was part of the tax law in the 1970s, when I started in the tax business.  That satisfies the requirements of the DemonRats; a tiny tax break for small investors and not enough incentive to motivate corporations to make the huge dividend payments that would stimulate the economy.

Tax cut priorities

Broken Promises

I always receive a lot of flack when I dare show any skepticism regarding the government’s veracity when it comes to honoring its promises.  This attitude isn’t based on any kind of hatred for the government; but rather an honest assessment of the past record.  Our rulers have no qualms whatsoever about breaking promises.  I am referring mainly to tax issues here; but there is no shortage of about-faces by our rulers.

When Social Security was first established, the promise was that the benefits would always be completely tax free.  What we have now is quite different, with 85% of the benefits subject to income tax for many of our seasoned citizens.

A few years ago, I was one of the lone voices warning against a popular move to convert ordinary IRA accounts into Roth IRAs.  This required people to pay real taxes based on the promise of tax free benefits several years down the road.  My concern then, as it still is now, is that by the time those people start withdrawing from their Roth IRAs, our rulers will establish a means test along the same vein as with Social Security recipients, requiring them to pay taxes on the Roth IRA pay-outs. 

States also break tax promises.  As shown in this article about the Section 529 college savings plans, many states that promised to waive income taxes on the accounts for people who go out of state are going back on their word and starting to tax them.

It just shows that tax planning is a never ending process, with constantly changing rules and moving targets.

KMK