Tax Guru – Ker$tetter Letter

Helping real people win the tax game.

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Archive for December, 2012

Posted by taxguru on December 29, 2012

French court rejects 75 percent millionaires’ tax –  We can’t expect the same kind of protection from our Supreme Court after the insane ObamaCare ruling from RINO Chief Justice John Roberts.


Raising Taxes Isn’t Compromise –  Dims still refuse to even mention any reductions in spending. 


Tax chaos looms in wake of Boehner’s failed ‘Plan B’ proposal –  Situation normal for DC.


$1 Trillion Obamacare Tax Hike Hitting on Jan. 1



Morning Bell: ’Twas the Night Before Cliff-mas – Funny parody.



Posted in TaxNews | Comments Off on


Posted by taxguru on December 28, 2012

As should be obvious, I’m a big fan of side by side comparisons of features of various things.  I found these slides comparing Qualified Retirement Plans (QRP) with IRAs from a recent webinar to be very interesting.  The webinar was presented by Michael Hawes, President of Pension Planners, LLC via CPA Academy, which has a lot of very interesting free CPE qualifying webinars.

Posted in Retire | Comments Off on QRP vs IRA

Comparing Health Benefits By Entity Type

Posted by taxguru on December 28, 2012

These comparison charts from the Federal Tax Update webinar I attended last week are quite handy.  They illustrate one of the big differences in tax free owner benefits between S and C corps that I have long been discussing and why at least one C corp is almost always a must have.




From Tax Info



Posted in corp, Deductions | Comments Off on Comparing Health Benefits By Entity Type

Funny video parodies

Posted by taxguru on December 26, 2012

Sherry sent me the links for these.  They will come in handy as we all go over the Fiscal Cliff together.

Xmas 2012 – Barack O’Claus is Comin’ to Town





Ray Stevens – Obama Budget Plan 



Ray Stevens – Obama Nation


Ray Stevens – Mr. President – Mr. President


Two Trillion Tons






“Tax You” Cee-Lo Green parody


Trouble With The IRS? – Good Advice From C&S



Posted in humor, video | Comments Off on Funny video parodies

No early filing of tax returns this coming Tax Season…

Posted by taxguru on December 25, 2012

How Washington’s failure to reach a tax deal could spoil your 2013

IRS filing frustration

Because of the confusion over the alternative minimum tax, millions of taxpayers may have to wait until mid-March to file their 2012 returns. The IRS, which had assumed Congress would simply avert that provision, notified Congress last week that up to 100 million taxpayers will have to wait to file if nothing is done – the IRS needs time to overhaul its computers.


Posted in Uncategorized | Comments Off on No early filing of tax returns this coming Tax Season…

Posted by taxguru on December 25, 2012

Posted in comix | Comments Off on

Posted by taxguru on December 25, 2012

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Posted by taxguru on December 25, 2012

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DIY Tax Prep Can Be Dangerous

Posted by taxguru on December 24, 2012


Subject: Willing to Pay some for answers to Tax questions–not yet a paying customer

Mr. Kerstetter,

M. R. … recommended you to me.  She is your client.  She is a long time friend of my family.  She takes care of most of my financial planning.  The attached one page document provides three questions and, I think, all the pertinent information needed to answer the questions.  I am asking first for an estimate of charges to answer my questions.  I think you could answer them with less than 15 minutes of your time spent on the whole thing.  Thank you for your assistance.



I looked over your questions and, while you may have been able to prepare your own tax returns in the past, the property sales have too many tricky issues to deal with for you to handle them on your own.

I can’t bring you up to speed on the various rules and issues that will need to be considered on your tax return.  To attempt that would be irresponsible on my part in much the same way as a doctor trying to teach you how to perform a surgical operation on yourself would be.

You need to have a professional tax practitioner prepare your returns to ensure that the sales are properly reported, as well as the passive activity income and suspended losses.  There is a possibility that the gain from the sale of the 39 acres may be classified as passive, which would free up your suspended passive losses. A tax pro should be able determine this after reviewing you prior year tax returns.

In regard to the sale of your residence, the law was changed on that in 1997.  It is no longer a once in a lifetime exclusion of gain for people over a certain age but an exclusion that can be used multiple times by sellers of any age who meet certain tests.  A professional tax advisor will explain how that fits into your situation.

Good luck.  I’m sorry I couldn’t be of more help.

Kerry Kerstetter



Thank you.   I will find a local pro in my local area.


Posted in 121, CapGains | Comments Off on DIY Tax Prep Can Be Dangerous

Comparing Tax Plans

Posted by taxguru on December 22, 2012

CCH has released its 2013 Fiscal Cliff Estimator, where you can see what the Federal income taxes will be under three of the options being discussed.  I can’t vouch for the precise accuracy of all the calculations.  However, based on all of the footnotes, it does appear that they have put some time and effort into these calculators.

I’m not sure that I would use this for actual tax planing purposes, but it does help give a flavor for how much money is at stake as our rulers in DC enjoy their taxpayer funded vacations.

For example, I entered MFJ with $150,000 of Taxable Income, $10,000 of LTCG and $500 of Dividends and it gave the following results for total Federal income tax.

Current 2012 Tax Rates:  $31,354.00   

Full Extension of Bush-Era Tax Cuts (Republican Plan): $31,040.50

Presidential and Senate Democratic Proposal:  $29,465.50

Expiration of the Bush-Era Tax Cuts (If Congress Does Not Act): $36,391.50


TaxCoach Software: Are you giving your clients what they really want?


Posted in TaxHikes, TaxRates | Comments Off on Comparing Tax Plans