The IRS Goes to Church – With a reminder that political preaching is a big no-no for any group wanting to maintain its tax exempt status..

States attack property taxes – My opinions of property taxes are well known.  This quote from the article pretty well sums up why.

The property tax is a fantastic tax for things that are purely local because, under those circumstances, it does not function like a tax. It’s more like a user fee.

In other words, you have to pay the local government a fee in order to use your own property, or else you have to forfeit that property to the government. This concept should anger anyone who believes in the sanctity of private property ownership, the foundation of capitalism.   

I received the following interesting email a few days ago:

Subject: RE: Seadog Bytes images

Kerry:

I ran across your blog today, and was pleased to see that you had apparently liked a few of my images (…which I’d sent to Art G. to put up StrangeCosmos)…
e.g.:
http://www.taxguru.net/comix/deathtaxgraverobbingbyirs.jpg
http://www.taxguru.net/comix/votersbewareemptyheads.jpg

The originals of those two images…
http://www.seadogbytes.com/sbimages/GraveRobbingIRS.jpg
http://www.seadogbytes.com/sbimages/ProsperityTaxed-1.jpg

…and a ‘few’ more (mostly conservative/political, as you might suspect) are up at our website: http://www.seadogbytes.com

(Access to most of the images is via the “Recent SeadogBytes” link near the center of the main page …you may find other SeadogBytes images there, or at StrangeCosmos, which you’d like to use from time to time.)

We’re certainly not in this for the money, but a reciprocal link back to http://www.seadogbytes.com, or a listing on your blog roll would certainly be appreciated, if you could manage to do that as a courtesy.

A text link would be absolutely fine, but if you need a logo graphic, one of the below images would also be all right to use (…or, if those don’t work for you, you could email to tell me what size you need and I could send you something back in relatively short order.)

Logos here:
http://www.seadogbytes.com/sbimages/dogS1asm.gif
http://www.seadogbytes.com/sbimages/dogS1aTiny.gif
http://www.seadogbytes.com/SeaRing50.gif

Thanks,
 – Brian

I wrote back:

Brian:

Thanks for writing and identifying yourself as the source of those pics I found on StrangeCosmos.  It’s often hard to know where the StrangeCosmos folks obtain their pics, especially when they add their name to the pic itself.

I also appreciate the link to your site and have added it to my blogroll and group of daily sites I will be visiting.  It’s great to know of another source of political parody photos, especially since the demise of Sacred Cow Burgers.

I will look over your other recent photos and appreciate your offer to allow me to post ones that my readers will like. 

I will also be posting this note and hope it results in more direct visitors to your website.

Thanks again for writing and keep up the excellent work.

Kerry Kerstetter

Follow-up from Brian:

Kerry:

Thank you very much! 

I have also, subject to your approval, added links to taxguru.net and taxguru.org to the main page at http://www.seadogbytes.com (middle of page, left column).

Also, if you are looking for other sources of ‘political art’, and have not yet seen them, you might like some of the things…

…at Linda Eddy’s http://www.iowapresidentialwatch.com/

…and Rich’s http://www.registeredmedia.com/gallery/

…both of whose images, in my experience, are uniformly excellent.

Regards,

 – Brian

My Reply:

Brian:

Thanks for the listing on your page and for the heads-up on those two other sites.  There are some very funny political comics there.

Kerry

 

As anyone could have predicted, the IRS plan to outsource some of their tax collections to private companies (gangs, families,et al) was ripe for even more screw-ups than are normal for IRS. IRS has even issued press releases warning people about the potential for scams, especially with real life free-lancers (aka scam artists) pretending to be tax collectors.

Simple Steps Can Prevent Tax Scams as Private Debt Collection Begins

IRS Outlines Taxpayer Protections in Private Debt Collection Program

The regular press is even picking up on this story:

IRS Warns Against Phony Debt Collectors

Q:

Subject: Section 121after death

 

If a parent dies (other spouse had already died a number of years ago) and leaves their primary residence to the children and they sell it 5 months after date of death can they claim the section 121, $250,000 exclusion on the 1041?  The house was in the parent’s living trust when the parent was alive.  Thank you for your help.

A:

This is the exact kind of issue that you must work on with a professional tax advisor.

There  are a number of issues to be resolved.

The Section 121 exclusion will only apply if one of the heirs has been living in the home after receiving title to it.  Even so, I doubt if there will be any gain to even worry about.

With a living (aka revocable) trust, ownership of the decedent’s assets generally transfers immediately to the  beneficiaries (heirs); so I doubt if the property sale would be reported by the estate on a 1041.  That is normally the case for property sales where title hadn’t been changed.

When your parent passed away, the cost basis for the heirs for all of her property is stepped up to its fair market value as of the date of death.   There are also provisions in the tax law to use an alternate date, usually six months later.   If the home is being sold shortly after death, as in your case, there wouldn’t be any gain because the sale price would be the estate value.  In fact, after accounting for selling costs, there is more likely to be a capital loss.

If the gross value of your parent’s estate exceeds the exclusion for the year in which she died, you must file an Estate Tax Return (Form 706) listing everything. This is sometimes even a good idea with smaller estates in order to document values and prevent any future accusations of tax evasion by IRS or the State.  This is a decision that your legal and tax advisors can assist with.

As you can see, there are a lot of details that need to be addressed with the assistance of competent tax and legal advisors.

Good luck.

Kerry Kerstetter

 

From a reader:

Subject: Thank You

Thank You for your site.  You have shown me that being a C Corp may not be as bad as everyone says.  I am using a June 30 FY because of your opinion (and I’m working with a local CPA to keep me straight).

My reply:

I’m glad you found my info useful.  However, it is never to be relied on in lieu of the services of a competent professional tax advisor who can better assess your situation.

You should also keep an open mind in regard to avoiding the all or nothing approach to running a business.  As your company and personal wealth grow, you and your advisor could very easily see the need for another entity in addition to your C corp.

Good luck.

Kerry Kerstetter

 

It’s just too bad that he doesn’t have the guts to do anything as forceful as this; just like his father.