Similar to the philosophy by which many people live; “he who dies with the most toys, wins.”

The tax-rebate check is in the mail – If you receive one of these checks, make sure to properly identify it in your checkbook and/or QuickBooks. Also, be sure to tell your tax preparer next year how much you received so we can all avoid the confusion that the 2001 rebate checks caused. I had dozens of clients swear that they hadn’t received their 2001 rebates, only to have IRS catch them and have to change their 1040s accordingly. That was one (of many) reasons we started requiring everyone to have all of their personal accounts set up on QuickBooks; so that we can check for the rebates.

Hey, Mom and Dad: Don’t Fall for This Tax Scam! – No need to pay anyone to get the IRS rebate checks. Any time there is money being tossed around, you can be sure there will be vultures trying to take it.

Do sailors get offended at being compared to the likes of politicians? Just wondering.

Building wealth

Kids Rally for Tax Credits and ‘Stuff Like That’ – Exploiting kids for their big government goals is nothing new for the lefties. “It’s for the children” is considered a bullet proof argument for anything.

The Government Budget Folly

Real problem is not the deficit

The deficit distraction

With many of our clients involved in real estate investing, as well as consulting with Sherry’s exchange company, we often see people make unwise moves (aka screw-ups).

A frequent mistake people make comes in identifying the replacement property for an exchange. In classic putting all of one’s eggs in a single basket, too many people set their sights on a single property and don’t have any backup properties listed by the end of their 45 day identification period. Anyone who has been around real estate transactions knows that deals can fall apart for any number of reasons and at any time, including at the very last minute. The Harrison Abstract fiasco is a perfect example of completely unexpected circumstances scuttling real estate deals.

If the original target property collapses before the 45th day, you can add new properties. However, if the deal for that intended replacement property falls apart after day 45, and there are no others listed, the exchange is canceled and the gain that could have been deferred becomes fully taxable. The moral of the story is so simple. Have at least one backup property, ideally two, listed by the end of the 45 day identification period.

One of my long time pet peeves has been the use of the oxymoron “progressive” to describe the graduated income tax rate structure that charges much higher percentages for those people who earn more than others. In this country, it is considered progressive to stick the upper income folks with an overly high share of the total tax burden. I’m not the only one who considers this a penalty on success and achievement.

People don’t like my mentioning the connection between the concept of progressive taxes and the Communist Manifesto, but check out item two in Marx’s platform and tell me why such a comparison isn’t relevant. Perhaps our rulers didn’t use the actual manifesto as their blueprint, but sick minds think alike.

On the flip side, it is considered to be “regressive” when lower income people pay a higher percentage of their income for certain taxes, most often sales taxes, than do the evil rich.

What is completely missing from the dialog on taxes is the concept of fairness or uniformity, such as each citizen paying the same dollar amount of taxes to support the government, or even the same percentage of their income.

Measuring the degree of progressivity can be done in a couple of ways. One way would be to just compare the lowest tax rate with the highest. For example, on a nominal level, the 2003 rates range from 10% to 35%, for a progressivity index of 3.5 to 1. For 2002, the rates ranged from 10% to 38.6%, giving a progressivity index of 3.86 to 1. Due to the phase-outs of tax deductions and credits at upper income levels, the actual effective tax rates can be much higher than the top scheduled rate.

The more commonly use measure of progressivity looks at the actual dollars paid by the various income levels. As in this 2000 chart, the top one percent of taxpayers paid 37.42% of all income taxes, for a progressivity index of 37.42 to 1.

I was recently asked if the newly passed tax rate cuts will increase or decrease the overall progressivity of the income tax system. As shown above, the progressivity of the nominal rates has dropped from 3.86 to 3.5. However, while we won’t know for sure until after the fact, I am confident in predicting that the shift of actual income tax dollars to the higher earners will be even more lopsided. As can be seen in the debates over the increased child tax credits, more people will be paying zero income tax. By definition, this will put more of the overall tax load on the remaining taxpayers, who are in the higher income ranges.

Curing Tax Code Could Cure Health Insurance Woes, Citizen Group’s Study Concludes

Dealing with the President’s right flank – Bush’s big spending agenda is not sitting well with those of us who want smaller government.

Wall Street and the States – There is quite a jurisdictional battle going on over who is going to regulate publicly traded corporations and how best to protect investors. You can be sure that scammers will exploit whatever discrepancies develop between the various jurisdictions, much as Delaware has long been used as token corporate headquarters in order to take advantage of the shareholder unfriendly rules in that state.

One of the biggest fears many people have is outliving their wealth. Knowing how much money a retiree needs is difficult to quantify, unless you are like one man at one of my seminars in Hot Springs, Arkansas a few years ago. He claimed to have already set the date for the end of his life and was basing all plans accordingly.

The most common feedback to my FoxNews article seems to be regarding the nickname I often use for the political party with a JackAss as its mascot. Many people are lobbying for other variations of the name, rather than the DemonRat term I have been using for the past several months.

Popular alternatives offered include: Dems, Dims, and Dumbocrats. I’m not sure about that last one, considering the association with Dumbo the elephant and the GOP’s mascot. The most impassioned case sent to me was the following, which I hope the sender doesn’t mind my quoting verbatim.

I must respectfully disagree with your use of DemonRat in your recent blog posted on FoxNews.com. I believe the term you are looking for in this case, referring to Wesley Clark, is DemonCrap. This is important! DemonCrap is incapable of effecting change in and of itself. It only serves as fertilizer for the seeds of bad ideas. DemonCrap is generally understood in academic circles to be the intestinal by-product left behind by the larger DemonRats like Terry McAuliffe or Hill and Billary Clinton. However, DemonCrap may also be used to refer to the stool of the lesser known, better disguised GreenRat, or even the once-thought extinct RedRat. I must ask that in the future you be more careful to make this distinction.