Tax Deductible Vacations

For those of us who are self employed, it isn’t hard to find ways to justify a perfectly legitimate tax deduction for travel anywhere in the world. I work with a lot of Realtors and have to constantly remind them that any trip they take can be considered as deductible business travel if they check in with local real estate offices wherever they go to see what properties are available for their local clients and to show the other offices what properties they have listed.

Gary Klott has an interesting article with some other tips for writing off what would normally be non-deductible vacations for W-2 wage slaves. Happy trails.

KMK

Making A Bad Situation Worse

One very consistent thing in this world is the utter incompetence whenever our rulers in DC deem it necessary for them to intrude into the marketplace and fix a problem. You can be sure that they will succeed in making the problem worse.

With the recent revelations of creative accounting at some large corporations, politicians are literally chomping at the bit to take over the auditing profession. I couldn’t agree more with this prediction of even less reliable numbers if our rulers succeed in getting their fangs into our profession. As I’ve said ad infinitum, the accounting tricks our rulers in DC have been pulling for decades are so much more nefarious than anything I have seen so far with the private corporations.

KMK

No Such Thing As A Free Lunch

With both of the big political parties working to continue their expansion of the imperial Federal government’s control over every aspect of our lives by providing prescription benefits for senior citizens, the impression is that all seniors are demanding this costly benefit.

I was glad to see this letter to Rich Lowry of National Review from a man who understands the trade-off between freedom and government benefits. As Queen Hillary’s failed socialist health care plan so explicitly laid out, when individuals accept Federal assistance, they cede to our rulers in DC the decisions as to what, if any, health care is allowable. I hope there are more people like this letter writer who understand the connection between money & freedom. Government payment plans always have very restrictive strings attached.

KMK

Postal Dis-Service

I’m sure there are business professors on college campuses out there who use the United States Postal Service as the epitome of how not to run a real capitalist for profit company. However, being a taxpayer subsidized monopoly means that the normal rules don’t really apply to it; so maybe such a comparison isn’t fair. However, the head honchos of the USPS keep telling our rulers in Congress that their goal is to make it self sufficient. If so, they are again heading in the wrong direction.

I could write endlessly on the idiotic mistakes they continue to make. However, I will limit myself to a few recent ones.

Raising Rates

The PO allegedly needs more money because of the losses it suffered after the 9/11 attacks. The geniuses at the USPS automatically jumped to raise their rates. As with almost every government policy, the result will be exactly opposite from the stated goal. Anyone with even the most basic understanding of elementary economics knows that an increase in prices for a product or service will result in lower consumption. With plenty of alternatives to sending things through the mail (fax, e-mail, FedEx, etc), the actual revenue will drop. Idiots.

I’m not a big fan of the GAO (General Accounting Office); but even they acknowledge that the USPS business model is destined for failure according to this press release from Citizens Against Government Waste.

Delivery Time

The PO has a nice website. They even allow you to order stamps online. However, what’s wrong with this picture? This is an actual quote from the USPS site:

Question & Answer Page

Question: How soon after I place my order will it arrive?

Answer: Please allow 3 to 5 business days for processing and delivery. Please allow 3 weeks to receive orders sent to foreign addresses.

If anyone has a head start in trimming delivery times, it would be the Post Office. Why is it that I can order a hard drive from a company on the Left Coast and receive it the very next day; but if I order a roll of stamps, I have to wait three to five days? Incompetence doesn’t even begin to describe this situation.

Anonymous Stamps

It’s always irked me when buying stamps around the time of a postage rate increase and finding that the stamps have a letter instead of the amount of postage. I’m sure we’re not alone with a drawer cluttered with lettered stamps and no idea of how much they are worth. Showing that there is no limit to stupidity with the PO, they have outdone themselves this time. Sherry just bought a roll of new 37 cent stamps and they have no number or letter. Just a picture of a US flag. How stupid is that?

It’s not easy to find, but I was able to locate the values of the previous lettered stamps from the USPS website. They call them Nondenominational Postage. I seriously doubt if our local PO knows these amounts; so I will be writing the amounts next to the stamps I use.

A breakdown of the A-H stamps with their denomination is as follows:

A $0.15

B $0.18

C $0.20

D $0.22

E $0.25

F $0.29

G (Old Glory) $0.32

G (postcard) $0.20

G (Dove) $0.03 (MAKE-UP)

H (Hat) $0.33

H (Rooster) $0.01 (MAKE-UP)

It would be good to print this out & keep near your stamp collection.

KMK

Double Standard Accounting

I in no way intend to defend the crooked accounting now coming to light by large corporations. I just couldn’t help but laugh at the hypocrisy of Bush threatening jail time for the book cookers, while these kinds of phony accounting techniques, and plenty of much worse ones, are routinely done by the Federal government’s own accountants.

How soon do you think it will be before any of them are sent to prison? About the time that Hell sends an ice hockey team to the Olympics. The fact that there are hundreds of millions of victims of the crooked government accounting (many times the number of WorldCom, Enron, et al victims) is beside the point.

KMK

It’s Our Turn

There was a time not very long ago that the accounting profession was rated in high regard among the public compared to other professions. With all of the recent disclosure of creative accounting in large corporations, that has changed. This joke from last night’s Letterman show makes that very clear.

There’s all these corporate scandals. First Enron and now this WorldCom thing. Things are getting so bad that New York Mets catcher Mike Piazza held a press conference today to say he wasn’t an accountant.

How long will it be before Willie Nelson’s song is changed to “Mama, Don’t Let Your Babies Grow Up To Be CPAs?” In fact, with Willie’s history of blaming his tax problems on his CPAs, I’m surprised that hasn’t already happened.

KMK

Big Government Is Expensive

Do you think the outrageously high & insatiable appetite for tax dollars by our rulers in DC could have anything to do with the fact that there are now 15 cabinet agencies, as opposed to just three when the country was founded? The Bush plan for another cabinet post, without eliminating any of the redundancy & overstepping in the existing ones, is just more of the same. Stephen Moore has a good take on this.

KMK

Profits Are Not Evil

To say that the economic literacy of the American populace is practically non-existent would be stating the obvious. A weekly lesson from the nation’s premier economics professor, Walter E, Williams, would go a long way towards brightening the dim bulbs that are strewn across this great nation. In this essay, Dr. Williams explains what profits really represent, and why non-profit organizations shouldn’t be as revered as they are.

KMK

New Tax Guru Recording Finally Available

Blind Leading the Blind

One of my many hot button issues is the fact that our rulers in DC base all of their decisions on economic predictions made by complete idiots who use static analysis. As Tom Nugent points out in this interesting article, the predictions by the DC static analyzers are almost always so far off when compared to the real life results, that no sane person should believe a thing they say.

He points put the very real analysis (which many people think is a satire) they did about a decade ago, estimating huge windfalls of revenue for the Federal government if the top marginal tax rate were raised to 100%. That study actually predicted higher revenues in each subsequent year, as taxpayers made more money that would be forked over to the IRS.

A more practical dynamic analysis of such a tax rate would reveal that a 100% tax rate would result in very little actual dollars for DC because, unlike the space aliens who populate DC, those of us in the real world would just as soon do something else with our time than work our butts off to make money that we can’t keep.

Once again, that is the reason that Federal income tax revenues doubled after Ronald Reagan reduced the top marginal tax rate from 70% to 28%. People will take risks and work harder if they are allowed to keep more of the fruits of their labors. Contrary to the conventional wisdom promulgated by the media, the truth is that the deficit grew in the 1980s solely because Congress went on a wild spending binge, much like they are doing right now.

KMK