2010 estate tax may go from 0 to 45 percent – You had to know that the tax free year wasn’t safe from attack by our money starved rulers in DC.  They simply can’t resist the urge to raise taxes on the “evil rich.”

For them, promises are meant to be broken and they have no qualms about backing off of lower tax promises.  As I have been warning since the inception of Roth IRAs, I wouldn’t be surprised to see their tax free status removed for those considered by our rulers to be evil rich.

War Is the Health of the Taxman. Democrats want a temporary war tax on the rich, like the one from 1898. – Kevin Williamson gives an excellent recap of the “temporary” taxes that were supposed to be only for the evil rich over the past 150 years in this country.  As should surprise nobody, temporary taxes live on forever and slowly grow to apply to just about everybody.  No sane person should expect any different result from the new proposed tax by the DemonRats.

Tax Hike in a Lab Coat… Dare to say no to Baucus-care.

The Baucus Bill Is a Tax Bill Middle-class families would get hit with a double-digit increase in their marginal tax rate.

– And anyone opposing this socialist takeover of the medical profession is going to be portrayed as racist, evil and cold-hearted.

Eight Year-End Moves That Can Cut Clients Tax Bills for 2009 and 2010 – Some good ideas from the most recent issue of the Intuit ProConnection Newsletter. 

These are obviously not the only ways by which to reduce taxes.  For example, they don’t mention the huge potential savings from setting up a C corp before year-end to move income off of a 1040 (aka Income Shifting), a subject that I hope to be able to cover in more detail in a webinar in the near future.. 

Q:

Subject:  Sec 179 depreciation.

Hello, just found you on the web and had a question regarding this tax law.  If our business takes a loss the first year (this year) can we still use this for the over 6,000 lb. commercial truck we purchased this year also?

Please let me know and thanks.

A:

Section 179 is very explicit on the fact that it cannot be used to cause or increase a net loss for the year.

The first year bonus depreciation doesn’t have that restriction, so it can be used to generate a net loss for the year.

Your own personal professional tax advisor should be able to properly handle the appropriate depreciation deductions for all of the capital assets for your business.  Do not attempt to do this on your own.

Good luck.

Kerry Kerstetter

Q:

Subject:  C Corp Question

Good Morning,

I am looking at forming a C Corp, based on your advice online. One thing I do not understand is how one bleeds off income at the end of the personal tax year (12/31) back to the corporation, to limit personal exposure to income tax. Can you explain that a little bit for me?  Also, if (as I anticipate to do) I form the C corp, are you available as a CPA for my company? And if so, at what cost?

Thanks for the information.

A:

The easiest way to bleed off income from your 1040 is to pay your corp for “Business Services” or “Management Services” and deduct it on the same schedule(s) where you are reporting your income (C, E, or F).

If all of your income is from a W-2, you will need to deduct the Services on Sch. A.

As you can see below, I am still not accepting new clients.

Good luck.  I hope this helps.

Kerry Kerstetter

From Jay Leno via NewsMax:

ACORN is an organization that gets government money to help poor people. Well, now they’re in trouble. These two film-makers went to ACORN posing as a pimp and prostitute saying they wanted to buy a house and run it as a brothel. ACORN gave them advice on how to do it and how to avoid prosecution and how to avoid paying taxes. If they want to get away with prostitution and not paying taxes, they should go to Congress. These are the professionals.

Obama’s top five tax fibs in Wednesday evening speech – Only five?

From WND’s Joke of the Day:

A visitor from the Netherlands was chatting with his American friend and was jokingly explaining about the red, white and blue in the Netherlands flag.

 “Our flag symbolizes our taxes,” he said, “We get red when we talk about them, white when we get our tax bill, and blue after we pay them.”

 “That’s the same with us,” the American said, “only we see stars, too.”

Robin Hood Tax Policy – As always, these new confiscatory tax plans will mean even more demand for help from those of us who believe in helping clients legally minimize their taxes.