Friday, August 18, 2023

State of New Hampshire - Tax Facts (ver. 2)

Registration of Business Name

  • If doing business under own name, registration is not required, but it is desireable.
  • If trading under any ficticious name, even your own, registration of this trade name may be accomplished by contacting:
    • Office of Secretary of State
      State of New Hampshire
      25 Capital St, 3rd Floor
      Concord, NH 03301
      (603) 271-3244 (603) 271-3246
      Click on "Forms & Laws" then "Tradenames"
      You receive a 5-year registration with a $50 fee. 
  • New Hampshire Business Tax
    • New Hampshire defines Gross Income as the total of all income for Federal income tax purposes from whatever source derived. 
    • NH Business Profits Tax (BPT)  7.5%
      • For TY2023 anyone in business, whose gross revenue exceeds $103,000 must file Form NH-1040. 
      • BPT tax rate is 7.5%
      • Form NH-1040 for sole proprietorships and single-member limited liability companies (SMLLCs) that are taxed as proprietorships federally.
      • Form NH-1065 for partnerships.
      • Form NH-1120 for corporations.
    • NH Business Enterprise Tax (BET)  0.55%
      • For TY2023, anyone in business, whose gross revenue exceeds $281,000 or whose BET Tax Base exceeds $281,000 must file Form NH-BET
      • BET Value Tax Base is the sum of all: 
      • compensation paid or accrued, interest paid or accrued, and dividends paid by the business enterprise,  
      • BET tax rate is 0.55%
      • Form NH-BET for all Corporations, Partnerships, Proprietorships,  Estates, Trusts, Non-Profits, LLCs, and Combined Groups.   
    • BT-Summary 
      • If you are required to file the BPT tax form and/or BET tax form, you must file the BT-Summary form. 
      • The BT-Summary form summarizes all of the taxes you owe to the New Hampshire Department of Revenue Administration (DRA). 
    • NH Interest & Dividends tax (I&D tax)  5.0%
      • NH I&D tax is assessed on Interest & Dividend income and is levied on all New Hampshire residents and fiduciaries whose gross interest and dividends income, from all sources, exceeds $2,400 annually ($4,800 for joint filers). 
      • In addition, Limited Liability Companies (LLC's), Partnerships, and Associations, with non-transferable shares, whose gross interest and dividends income, from all sources, exceeds $2,400 annually must file and pay NH I&D Tax.
      • I&D tax rate is 5.0%
      • Form DP-10 for all entities.
    • File your NH tax return(s) online GRANITE TAX CONNECT 
      • New Hampshire Department of Revenue Administration
        Governor Hugh Gallen State Office Park
        109 Pleasant Street (Medical & Surgical Building)
        Concord, NH 03301  
      • Taxpayer Services Division tel: (603) 230-5000      
    • Here is a table of the BPT, BET, & I&D tax rates in NH from 2016 to 2026:
    •    Year  BPT Rate  BET Rate  I&D Rate
      • 2016  7.7%       0.6%        5% 
      • 2017  7.7%       0.6%        5% 
      • 2018  7.7%       0.6%        5%
      • 2019  7.7%       0.6%        5%
      • 2020  7.6%       0.55%      5%
      • 2021  7.6%       0.55%      5%
      • 2022  7.6%       0.55%      5%
      • 2023  7.6%       0.55%      4%
      • 2024  7.6%       0.55%      3% 
      • 2025  7.6%       0.55%      2%
      • 2026  7.6%       0.55%      1%
    • NH I&D Tax is repealed for taxable periods beginning after 12/31/2026
    • Here is a table of the BPT & BET filing thresholds in NH from 2016 to 2026:
  •                       BPT          BET           BET
  •                  Threshold  Threshold  Threshold  
    •  Tax      Gross       Gross          Value
    • Year    Income     Income         Base
    • 2016     50K          207K             103K 
    • 2017     50K          208K             104K 
    • 2018     50K          208K             104K
    • 2019     50K          217K             108K
    • 2020     50K          217K             108K
    • 2021     50K          222K             111K
    • 2022     92K          250K             250K
    • 2023   103K          281K             281K
    • 2024   103K          281K             281K 
    • 2025         *             *                     *
    • 2026         *             *                     *                                                                            
  • Licenses
    • State and municipal ordinances require licenses of various kinds for a number of businesses. A restaurant, for instance, may require clearance from the local Fire Dept., Sanitation Dept., Health Dept., Board of Alcoholic Beverage Control, etc. 
    • State licenses are required for business activities such as:
      • outdoor advertising 
      • liquor handling 
      • real estate brokering 
      • electrical contracting 
      • automobile dealerships 
      • junk yards 
      • lumber sales
      • other
    • It is recommended that prospective businesspeople make thorough inquiries to the appropriate municipal and state authorities.
  • Choosing Your Form of Business Organization
    • There are different advantages and disadvantages to the four (4) major forms of business organization:
      1. Sole Proprietorship,
      2. Partnership,
      3. Corporation, 
      4. Limited Liability Company (LLC). 

  • You would be wise to consult an attorney for legal advice. For the name of an attorney call: 
  • Complaints
    • Consumer complaints may be filed with:
      • NH Consumer Protection & AntiTrust Bureau
        33 Capitol St
        Concord, NH 03301-6397
        (603) 271-3641
  • Federal Trade Commission (FTC)
    • The FTC is a federal agency which deals with consumer protection matters on a national level or when interstate commerce is involved.
      • Federal Trade Commission
        600 Pennsylvania Ave, NW, Washington, DC 20580-0002
        1-877-FTC-HELP or 1-877-382-4357 (toll-free)
        TDD: 1-202-326-2502

Tuesday, August 15, 2023

Theory and Practice may diverge when the IRS considers the Evidence

  "Audits can neither, nor should, level the playing field between small business owners and employees, because the law itself creates an uneven playing field. 
  What audits can do, is to make sure taxpayers who are entitled to claim deductions of certain amounts, or to exclude income of certain amounts, are not overstating these amounts factually, or characterizing payments that are one thing, as something else. 
  But as it has been recognized for many decades, there are trade-offs between a less-than-optimal (from a pure revenue standpoint) allocation of limited IRS resources on large numbers of small businesses, and focusing on small business in order to assure employees, whose income is subject to withholding, and gets reported on a W-2, that W-2 employees are being treated fairly, relative to independent contractors and business owners whose reporting requirements may be looser." - Robert Kantowitz

Wednesday, June 7, 2023

99 Chuck Norris Approved Jokes. Read Now, or else!

  • Chuck Norris is known as one of the best action heroes in the past 50 years!   Invincible, hyper-masculine, sophisticated. If you look up any of these words in the dictionary all you’ll find is a picture of Chuck Norris. And the superlatives don’t end there… He’s mega-tough, unmatched, and omnipotent. He’s the superheroes superhero. Whatever the question, Chuck Norris is the answer.
  • Here's 99 Chuck Norris Facts that are unquestionably true. Read, digest, laugh, nod in agreement. That’s the wisest course of action.
  1. Chuck Norris keeps a diary. It’s called The Guinness Book Of World Records.
  2. Chuck Norris knows Victoria's secret.
  3. Superman sleeps in a pair of Chuck Norris pajamas.
  4. Chuck Norris tells Simon what to do.
  5. Chuck Norris counted to infinity. Twice.
  6. Chuck Norris doesn't cheat death. He wins fair and square.
  7. Once a cobra bit Chuck Norris' leg. After five days of excruciating pain, the cobra died.
  8. Chuck Norris doesn’t get a flu shot. He is the vaccine.
  9. While learning C.P.R. Chuck Norris brought the dummy to life.
  10. When Google has a question they “Norris” it.
  11. Before the Boogeyman goes to sleep he checks under his bed for Chuck Norris.
  12. Santa Claus visits Chuck Norris’ house first.
  13. Chuck Norris can run on water.
  14. Chuck Norris’ blood type is A-K 47.
  15. Chuck Norris has been to Mars. That's why there’s no sign of life.
  16. The dark is scared of Chuck Norris.
  17. Chuck Norris actually died ten years ago. Death just hasn’t built up the courage to tell him.
  18. Chuck Norris doesn’t turn on the shower. He stares at it until it starts to cry.
  19. Chuck Norris can gargle peanut butter.
  20. Chuck Norris. Born: 1940 Died: Never.
  21. At Easter Chuck Norris has hot cross Chuck Norris.
  22. Chuck Norris’ dog picks up his own crap.
  23. When there’s a meteor shower Chuck Norris grabs a bar of soap.
  24. Chuck Norris doesn’t flush the toilet. He scares the shit out of it.
  25. When Chuck Norris does a push up, he isn’t lifting himself up, he’s pushing the earth down.
  26. If you have $5 and Chuck Norris has $5, Chuck Norris has more money than you.
  27. Chuck Norris went to Hungry Jack’s and got a Big Mac.
  28. There is no theory of evolution. Just the creatures Chuck Norris allowed to live.
  29. Chuck Norris boils the kettle by staring at it .
  30. Chuck Norris can kill two stones with one bird.
  31. Time stands still for no man. Unless it’s Chuck Norris.
  32. Elvis has left the building. Because Chuck Norris told him to.
  33. Traffic lights never turn red for Chuck Norris. Nothing stops Chuck Norris.
  34. Netflix doesn’t make recommendations to Chuck Norris about what he can watch next. Netflix waits for Chuck Norris to tell them what to screen.
  35. Chuck Norris never showers. He only takes blood baths.
  36. Chuck Norris can win a game of Connect 4 in three moves.
  37. The Great Wall of China was originally built to keep Chuck Norris out. It failed.
  38. Chuck Norris can believe it’s not butter.
  39. Chuck Norris doesn’t bowl strikes. He knocks down one pin and the other nine faint.
  40. Chuck Norris did in fact, build Rome in a day.
  41. If at first you don’t succeed, you’re not Chuck Norris.
  42. Chuck Norris can lead a horse to water AND make him drink.
  43. Chuck Norris doesn’t play the lottery. It doesn’t have enough balls.
  44. Chuck Norris doesn’t own a house. He walks into random houses and people leave.
  45. Everybody loves Raymond. Except Chuck Norris.
  46. Superman and Chuck Norris had an arm wrestle. The loser had to wear his underwear on the outside.
  47. Chuck Norris has a grizzly bear rug. It’s not dead, it’s just too afraid to move.
  48. Chuck Norris makes onions cry.
  49. Chuck Norris won The Voice using sign language.
  50. Chuck Norris can sneeze with his eyes open.
  51. Chuck Norris doesn’t win. He allows you to lose.
  52. Chuck Norris can watch the radio.
  53. Chuck Norris doesn’t need an account. He just logs in.
  54. Chuck Norris doesn’t leave a message. You have 3 seconds to ring him back.
  55. Chuck Norris always comes first. Just ask the chicken and the egg.
  56. If Chuck Norris has a pen, the pen is mightier than the sword.
  57. When one door closes Chuck Norris kicks it in.
  58. Sweating bullets is literally what happens when Chuck Norris gets hot.
  59. Chuck Norris can get stone out of blood.
  60. Chuck Norris doesn’t panic buy toilet paper. He uses sandpaper.
  61. Chuck Norris not only shot the sheriff, but he roundhoused the deputy too.
  62. Chuck Norris does not sleep. He just waits.
  63. Chuck Norris has never blinked. Never,ever.
  64. Chuck Norris breathes slowly. Seven times a day.
  65. Chuck Norris can tie his shoes with his feet.
  66. The magic word is please. As in “please don’t kill me”. Unfortunately Chuck Norris doesn’t believe in magic.
  67. Chuck Norris takes 20 minutes to watch 60 minutes.
  68. Chuck Norris once kicked a horse in the chin. Its descendants are today known as a giraffe.
  69. We live in an expanding universe. The universe is trying to get away from Chuck Norris.
  70. Chuck Norris strikes lightning.
  71. Chuck Norris stared at the eclipse and the eclipse looked away.
  72. With Chuck Norris as world leader there’d be no crime. Just punishment.
  73. Chuck Norris’ cowboy boots are made of real cowboys.
  74. Chuck Norris’ computer doesn’t have a shift key. Chuck Norris doesn’t shift for anyone.
  75. Chuck Norris can crack walnuts with his eyelids.
  76. Everyone has a skeleton in the closet. Chuck Norris has 5,789.
  77. Chuck Norris slept through the Big Bang.
  78. You might say Chuck Norris can’t act. But you won’t say anything else. Ever.
  79. Chuck Norris plays soccer with a bowling ball.
  80. Chuck Norris uses a stunt double for crying scenes.
  81. Chuck Norris doesn’t wear a watch. He just decides what time it is.
  82. Every winner should first say, “I’d like to thank Chuck Norris for not competing.”
  83. Chuck Norris protects his bodyguards.
  84. When Chuck Norris enters a courtroom the judge stands up.
  85. When Chuck Norris looks in the mirror, the glass shatters. Not even a mirror is stupid enough to get between Chuck Norris and Chuck Norris.
  86. Chuck Norris can win an argument with his wife.
  87. If it walks like a duck, talks like a duck and looks like a duck but Chuck Norris says it’s a sheep, then it’s a sheep.
  88. Bruce Springsteen calls Chuck Norris, “The Boss”.
  89. Chuck Norris can whistle in sign language.
  90. If Chuck Norris was a Spartan the movie would have been called, “1”.
  91. Aliens believe in Chuck Norris.
  92. When Batman is in trouble he turns on the Chuck Norris signal.
  93. Chuck Norris can remember the future.
  94. When Chuck Norris was born the doctor exclaimed, “It’s a man!”.
  95. Chuck Norris once broke the sound barrier. In half.
  96. The Hulk and Chuck Norris had a fight in the forest. The Hulk is now known as Shrek.
  97. Steroids are made from Chuck Norris.
  98. Chuck Norris can experience a once in a lifetime occurrence. Twice.
  99. Chuck Norris is the only weapon allowed through airport security.

Tuesday, June 6, 2023

Notable Quotes

"Save your money, pay your taxes, it doesn't last forever..." -- "Stone Cold" Steve Austin, WWE Hall of Fame

"Good contracts make good friends." -- "Big Don" Jankoski

"Hang on the walls of your mind the memory of your successes. Think of the good jobs you've done. Think of the times when you rose above your average level of performance and carried out an idea or a dream. Hang those pictures on the walls of your mind, and look at them as you travel the roadway of life." -- Alex Saltonovicz

"If rich people could pay poor people to die for them, poor people would do very well." -- Yiddish Proverb

"Anyone may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes. Over and over again the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike and all do right, for nobody owes any public duty to pay more than the law demands." -- As Judge Learned Hand (1872 - 1961) stated in Helvering v. Gregory. 9 F.2d 809, 810 (2nd Cir.1934) aff'd 293 U.S. S. Ct. 266 (1935)

"I will persist until I succeed. I was not delivered into this world in defeat, nor does failure course in my veins. I am not a sheep waiting to be prodded by my shepherd. I am a lion and I refuse to talk, to walk, to sleep with the sheep. The slaugherhouse of failure is not my destiny. I will persist until I succeed." -- From the ancient scroll marked III, Og Mandino

Chuck Norris created the martial art Chun Kuk Do, which is based primarily on Tang Soo Do and includes elements from every combat style he knows. Like many other martial arts Chun Kuk Do includes a code of honor and rules to live by. These rules are from Chuck Norris' personal code. They are:
I will develop myself to the maximum of my potential in all ways.
I will forget the mistakes of the past and press on to greater achievements.
I will continually work at developing love, happiness and loyalty in my family.
I will look for the good in all people and make them feel worthwhile.
If I have nothing good to say about a person, I will say nothing.
I will always be as enthusiastic about the success of others as I am about my own.
I will maintain an attitude of open-mindedness.
I will maintain respect for those in authority and demonstrate this respect at all times.
I will always remain loyal to God, my country, family and my friends.
I will remain highly goal-oriented throughout my life because that positive attitude helps my family, my country, and myself.

"Rabbits are the sign of fertility and new life -- known for their ability to make great leaps and hops. If a rabbit shows up it means you should plan for possibilities -- need to do more planning or check those you have already set in motion -- you do not want to box yourself in a corner -- it is important not to foreshadow your moves. Rabbits are clever at doubling back, making quick and rapid turns -- learning to shift from freezing to great speed will aid your success and enable you to take advantage of opportunities that may only present themselves for brief moments. Rabbits are vegetarians -- you need to examine the foods you are consuming. Vegetarian diet will strengthen and heal." -- Anon.

"No one can make you feel inferior without your consent." -- Eleanor Roosevelt

"Better to live modestly within your means than stressfully outside them." -- Anon.

"Don't be intimidated by power, wealth or station, character alone makes all the difference." -- "Joe" Biden, Jr., 47th Vice President of the United States

"If you are chasing your dreams, you are not running fast enough." -- Todd Alexander

"Remember, attitude is the only thing, it makes all the difference." -- Todd Alexander

"If we are ever in doubt about what to do, it is a good rule to ask ourselves what we shall wish on the morrow that we had done." -- John Lubbock—British statesman (1834–1913)

"Any fact facing us is not as important as our attitude toward it, for that determines our success or failure." -- Norman Vincent Peale

"Chance favors the prepared mind." -- Louis Pasteur

Whether our efforts are, or not, favored by life, let us be able to say, when we come near the great goal, 'I have done what I could'." -- Louis Pasteur

“Let me tell you the secret that has led me to my goal: my strength lies solely in my tenacity.” -- Louis Pasteur

"Believe you will succeed, and you will." -- Dale Carnegie

"Try honestly to see things from the other person's point of view." -- Dale Carnegie

"The successful man will profit from his mistakes and try again in a different way." -- Dale Carnegie

"Though we travel the world over to find the beautiful, we must carry it with us or we find it not." -- Ralph Waldo Emerson

"Enjoy what you can, and endure what you must." -- Johann Wolfgang von Goethe, German poet, novelist, & playwright (1749 - 1832)

"Respect other people and value the difference." -- Anon.

"When faced with a choice of what to do, always err on the safe side." -- Jack P. Friedman

"Nobody can steal your joy unless you let them." -- Scriptures

"They are able who think they are." -- Virgil

"Fate, dear Brutus, lies not with the stars but within ourselves." -- Julius Caesar

"Time is the only commodity that is inelastic; once it's gone, you can never get it back." -- Economics 101

"To move the world, we must first move ourselves." -- Socrates

"Give me a place to stand and I can move the earth." -- Archimedes

"Terrorists try and shake our will, and shake our confidence. They will find out differently." -- George W. Bush, Jr.

"An error doesn't become a mistake...until you refuse to correct it." -- John F. Kennedy

"The truth will set you free." -- Anon.

"Let us dare to read, think, speak and write." -- John Adams, 1765

" Experience is a hard master, but fools will have no other." -- John Adams

"The only thing new in this world is the history you don't know." -- Harry S. Truman

"These things have I written unto you that believe on the name of the Son of God; that ye may know that ye have eternal life, and that ye may believe on the name of the Son of God." -- I John 5:13

"Regardless of your race, religion or political affiliation, never hesitate to question those in authority." -- Tavis Smiley

"One man with courage is a majority" -- Andrew Jackson

"The avoidance of taxes is the only pursuit that still carries any reward." -- John Maynard Keynes

"Live every day with an attitude of gratitude." -- Anthony Robbins

"So often times it happens that we live our lives in chains and we never even know we have the key!" -- The Eagles

"I would rather receive one percent of the income of 100 men, than 100% of the income of one man." -- J. Paul Getty

"You are not truly wealthy unless you earn money while you are sleeping" -- Aristotile Onasis

[In an interview with Larry King] "I was lucky to be in the right place at the right time. But many others were also in the same place. The difference was that I took action." -- Bill Gates

"Chose a job you love, and you will never have to work a day in your life." -- Confucius, BC 551-479, Chinese Ethical Teacher, Philosopher

" - Envision a mission
- Be results oriented
- Tap your internal resources
- Enlist team spirit
- Treat set-backs as stepping stones" -- Charles A. Garfield

"We live in a wonderful world that is full of beauty, charm and adventure. There is no end to the adventures that we can have if only we seek them with our eyes open." -- Jawaharlal Nehru, 1889-1964, Indian Nationalist, Statesman

"Fear less, hope more, eat less, chew more, whine less, breathe more, talk less, say more, hate less, love more; all good things will be yours." -- Swedish Proverb

"The wind and the waves are always on the side of the ablest navigators." -- Edward Gibbon, 1737-1794, British Historian

"Today is mine. It is unique. Nobody in the world has one exactly like it. It holds the sum of all my past experiences and all my future potential. I can fill it with joyous moments or ruin it with fruitless worry. If painful recollections of the past come into my mind, or frightening thoughts of the future, I can put them away. They cannot spoil today for me." -- Anonymous

"It is better to conquer yourself than to win a thousand battles. Then the victory is yours. It cannot be taken from you, not by angels or by demons, heaven or hell." -- Buddha, 568-488 BC, Founder of Buddhism

"The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where he stands at times of challange and controversy." -- Martin Luther King, Jr., 1929-1968, American Black Leader, Nobel Prize Winner, 1964

"Be courageous! Whatever setbacks America has encountered, it has always emerged as a stronger and more prosperous nation.... Be brave as your fathers before you. Have faith and go forward!" -- Thomas A. Edison

"Genius is one per cent inspiration and ninety-nine per cent perspiration. Accordingly, a 'genius' is often merely a talented person who has done all of his or her homework." -- Thomas A. Edison 1847-1931, American Inventor, Entrepreneur, Founder of GE

"Goals are dreams we convert to plans and take action to fulfill." -- Zig Ziglar

"Success is a state of mind. If you want success, start thinking of yourself as a success." -- Joyce Brothers

"Never walk away from failure. On the contrary, study it carefully for its hidden assets." -- Michael Korda

"It's hard to fail, but it is worse never to have tried to succeed." -- Theodore Roosevelt

"I always try to turn every disaster into an opportunity." -- John D. Rockefeller

"Never give up then, for that is just the place and time that the tide will turn." -- Harriet Beecher Stowe

"Push yourself again and again. Don't give an inch until the final buzzer sounds." -- Larry Bird

"You will become as small as your controlling desire, as great as your dominant aspiration." -- James Allen

"I do the very best I know how, the very best I can, and I mean to keep on doing it to the end." -- Abraham Lincoln

"Each man is as happy as he chooses to be." -- Abraham Lincoln

"No army can withstand the strength of an idea whose time has come." -- Victor Hugo

"A person doesn't know how much he has to be thankful for until he has to pay taxes on it." -- Ann Landers

"If only one wish to be happy, this could be easily accomplished. But we wish to be happier than other people. This is always difficult, for we believe others to be happier than they are." -- Anonymous

"It's a game. Tax lawyers teach the rich how to play it so they can stay rich--and the IRS keeps changing the rules so we can keep getting rich teaching them." -- John Grisham

"A problem defined, is a problem half solved." -- Albert Einstein

"The hardest thing in the world to understand is the income tax." -- Albert Einstein

"The only thing more expensive than education is ignorance." -- Kelly L. Reese

"Don't go near your prince unless he calls for you twice." -- 12th century German proverb

"We get old too soon, and smart too late" -- Pennsylvania Dutch proverb

"Only those who will risk going too far can possibly find out how far one can go." -- Thomas Stearns Eliot

"Lord release our fears, cares and anxieties and fill our hearts with peace that only you can give to us." -- Amen.

"Finally, brethren, whatever things are true, whatever things are noble, whatever things are just, whatever things are pure, if there is any virtue and if there is anything praiseworthy--mediate on these things" -- Philippians 4:8

"It is the Law of Gender: for every Male energy (yin) there is a corresponding Female energy (yang). These energies must be in balance for your life to be in harmony." -- Chinese proverb

"Destiny is not a matter of chance, it's a matter of choice. It is not a thing to be waited for, it's a thing to be achieved." --
William Bryan Jennings

"Nothing in this world can take the place of persistence. Talent will not; nothing is more common than unsuccessful people with
talent. Genius will not; unrewarded genius is almost a proverb. Education will not; the world is full of educated derelicts.
Persistence and determination alone are omnipotent. The slogan 'Press On' has solved and always will solve the problems
of the human race." -- Calvin Coolidge

"Persistence and determination alone are omnipotent" -- Calvin Coolidge

"Civilization and profits go hand in hand." -- Calvin Coolidge

"I want to find out who this FICA guy is and how come he's taking so much of my money." -- Nick Kypreos, Toronto Maple Leafs

"He who rejects change is the architect of decay." -- Prime Minister Harold Wilson, 1967

"You will never be powerful in life until you are powerful over your own money. How you think about it. How you feel about it. How you invest it. Nobody, nobody, is going to care about your money more than you do. What directly happens to your money effects the quality of your life." -- Suze Orman

"You and I have the right to do what you and I want economically." -- Robert E. Young

"We will not waver; we will not tire; we will not falter; and we will not fail. Peace and freedom will prevail." -- President George W. Bush, Jr., September 11, 2001

"When you are in the right, you can afford to keep your temper; and when you are in the wrong, you cannot afford to lose it." -- Gandhi

"You don't create wealth by the money you make. You create wealth by the money you keep. Rich people didn't get rich by giving their money away." -- Peter D. DeMarco

"If the problem can be solved, there is no use worrying about it. If it can't be solved, worrying will do no good." -- Tibetan Buddist proverb

"The only reason they come to see me is that I know life is great and they know I know it." -- Clark Gable

"The Fountain of Youth is in your mind." -- Sophia Loren

"Look to your health; and if you have it, praise God, and value it next to a good conscience; for health is the second blessing that we mortals are capable of; a blessing that money cannot buy." -- Izaak Walton

"Life is simple." -- Dalip S. Mahal

"Things that matter most should never be at the mercy of things which matter least." -- Johann Wolfgang von Goethe

"It takes a great deal of boldness and a great deal of caution to make a great fortune, and when you've got it, it requires ten times as much wit to keep it." -- Ralph Waldo Emerson

"Beware of little expenses. A small leak will sink a great ship." -- Ben Franklin

"Three of them may keep a secret if two of them are dead." -- Ben. Franklin

"To accept good advice is but to increase one's own ability." -- Johann Wolfgang von Goethe

"That which we acquire with the most difficulty we retain the longest; as those who have earned a fortune are usually more careful of it than those who have inherited one." -- Charles C. Colton

"The person who doesn't know where his next dollar is coming from usually doesn't know where his last dollar went." -- Unknown

"Your bottom line starts with your front line." -- John Villere

"A good friend is like a wonderful book... the inside is even better than the cover." -- Unknown

"You cannot teach a person anything, you can only help them find it within themselves." -- Galileo

Saturday, September 3, 2022

How to Call the IRS

  • How to Call the IRS: 
    •  1-800-829-1040 
      • hours 7 AM - 7 PM local time Monday-Friday
  • When calling the IRS do NOT choose the first option e.g. "Refund", or it will send you to an automated phone line.
    • So after first choosing your language, then do NOT choose Option 1 (refund info).
      • Choose option 2 for "personal income tax" instead.
  • Then press 1 for "form, tax history, or payment".
  • Then press 3 "for all other questions."
  • Then press 2 "for all other questions."
  • When it asks you to enter your SSN or EIN to access your account information, don’t enter anything.
    • After it asks twice, you will get another menu.
  • Then press 2 for personal or individual tax questions.
  • It should then transfer you to an agent.

Thursday, January 13, 2022

ACTC payments + 3rd Round EIP payments

  • The IRS announced it will issue information letter (Letter 6419, 2021 Advance CTC) Advance Child Tax Credit (ACTC) to recipients starting in December 2021, and
  • (Letter 6475 - Your Third Economic Impact Payment), EIP $(1,400), paid in March of 2021, to recipients of the third-round of the Economic Impact Payments (EIP) to EIP recipients in late January 2022.
  • Tax preparers should use this info when preparing a tax return to reduce errors and delays in processing.
  • These letters will assist taxpayers when preparing their TY2021 federal tax return in 2022. Learn more --->

Monday, July 26, 2021

Babe Ruth, great pitcher and baseball's King of Swat

  In 1922, Babe Ruth made $52,000, playing for the New York Yankees.  Babe Ruth invented the home run. Babe Ruth hit 54 homes runs before anyone hit one. Ruth created baseball as we know it today.

  In 1930, Mr. Ruth made $80,000. Babe was criticized for making more money than President Hoover. 
Mr. Ruth said "well, I had a better year than President Hoover." In 1930,  because it was the Great Depression, prices declined and therefore $80,000 was worth even more.
  In 1930, consumer goods prices, a can of Campbell's soup was 6 cents, a new Chevrolet was $600, gas was 17 cents a gallon.
  Today, a can of Campbell's  soup is about one dollar, a new Chevy Malibu is $25,000, gas is about $4 a gallon.
In 1930, Harvard tuition was $400 per year, cost of a baby delivery was $100, and an ounce of gold was worth $17. Today, gold is $1,800 an ounce. That difference for a stock in today's dollars would be $110,000.
  What is $80,000 in today's dollars?  In today's dollars $80,000 would be $1.4 million adjusted for the CPI. 
But, we don't live the same way we did in the 1930's. For one thing, it's cheaper to manufacture goods today.
  Today we are in a service based economy, and the cost of living increases only because the cost of services  increase?  Cost of living depends on your "purchasing pattern". Different families can have different 'inflation levels'?
  So how rich was the guy? Not too bad.
  Remember, in Mr. Ruth's day, there was no television and there was no such thing as selling advertising or athletic endorsements.
  Today, athletes get paid even more because they help companies, such as Nike, make more money through their endorsements. 
  I don't begrudge athletes for making the money they do. 

Wednesday, June 24, 2020

Covid-19

Due to the current Covid-19 crisis, I’ve been particularly focused on health and preparedness. Older adults are and will continue to face increased hardships during the Coronavirus pandemic. But there are things they can do. I’ve found some additional resources I hope are helpful for you.

Tuesday, May 5, 2020

Economic Impact Payment - Coronavirus "Stimulus Check"

Coronavirus "Stimulus Check"

  • How does one return a "Stimulus Check" that was deposited into the account of a deceased taxpayer? Information I can find says it has to be returned? No problem there. However, nothing explains "HOW" to send it back, when the check was direct deposited?
  • The stimulus is $1,200 per taxpayer whose income is $-0- to $75,000 ($-0- to $150,000 MFJ). So the 2018 vs. 2019 issue was, if the taxpayer qualified, based on 2018 income, but didn't qualify based on 2019 income, they could wait to file 2019, until they got the stimulus based on 2018. If they had filed 2019 and was over the income limit, they still had a chance to get it, but had to wait until they filed 2020 because this is what the stimulus is based on. In any case, there is no "clawback" of the stimulus in 2020.
  • The proof the advance stimulus payment does not need to be paid back is §6428(e)(1), which was added to the Code by the CARES Act:
    • (e) COORDINATION WITH ADVANCE REFUNDS OF CREDIT.--
      • (1) IN GENERAL.---The amount of credit which would (but for this paragraph) be allowable under this section shall be reduced (but not below zero) by the aggregate refunds and credits made or allowed to the taxpayer under subsection (f).
  • The phrase "this section" refers to §6428.  Note the language, "but not below zero."  As a result, if the taxpayer's credit on the 2020 return ("the amount of credit which would (but for this paragraph) be allowable under this section"), after being reduced by the advance credit, is less than zero, then the taxpayer does not get an additional credit on the 2020 return, and none of the advance payment needs to be paid back.

Sunday, March 29, 2020

What the Coronavirus Stimulus Package Means for You

What the Coronavirus Stimulus Package Means for You
The pandemic has brought lots more attention to §7508A which allows the IRS to extend deadlines in the event of certain disasters. Using its authority under §7508A(a) the IRS first announced the extended time to pay taxes, then it announced the extended time to file taxes and then it announced broad extensions including the time to file Tax Court petitions and numerous other acts outlined in Rev. Proc. 2018-58.

Tuesday, March 10, 2020

Backdoor Roth

  • A backdoor Roth IRA is not an official type of retirement account. Instead, it is an informal name for an, IRS-sanctioned method for high-income taxpayers to fund a Roth, even if their income is higher than the maximum the IRS allows for regular Roth contributions. The annual Roth IRA limit is $6,000 in both 2020 and 2019, up from $5,500 in 2018 (if you’re 50 or older, you can add $1,000 to those amounts).
  • TY2019 Traditional IRA phaseout (MAGI):
    • Single: 64,000 - 74,000
    • Married: 103,000 - 123,000
  • TY2019 Roth IRA phaseout (MAGI):
    • Single: 122,000 - 137,000
    • Married: $193,000 to $203,000
  • Backdoor Roth IRAs are not a special type of account; rather, they are usually traditional IRA accounts or 401-K's which have been converted to Roth IRAs. A backdoor Roth IRA is a legal way to get around the income limits that normally restrict high-earners from contributing to Roths. A backdoor Roth IRA is not a tax dodge—in fact, you might incur a small amount of tax when it's established—but it does provide investors with future tax savings.
  • Traditional IRAs don't have income limits. And since 2010, the IRS has not had income limits restricting who can convert a traditional IRA to Roth IRA. As a result, the backdoor Roth has become an option for higher-income taxpayers who ordinarily weren't able to contribute to a Roth.
  • The funds you put into the Roth are considered converted funds, not contributions. This means you have to wait five years to have penalty-free access to your funds if you’re under age 59½. In this sense, they differ from regular Roth IRA contributions, which you can withdraw at any time without tax or penalty.
  • You can do a backdoor Roth IRA in one of several ways:
    • The first method is to contribute money to an existing traditional IRA and then roll over the funds to a Roth IRA account. Or, you can roll over existing traditional IRA money into a Roth—as much as you want at one time, even if it's more than the annual contribution amount.
    • Second way is to convert your entire traditional IRA account to a Roth IRA account.
    • Third way to make a backdoor Roth contribution is by making an after-tax contribution to a 401-K plan and then roll it over into a Roth IRA.
  • Backdoor Roth is not a tax dodge. You still need to pay taxes on any money in your traditional IRA that hasn’t already been taxed.
  • 10% Penalty and Roth IRA Conversions
    • While funds you convert to a Roth IRA are taxable no matter your age, the 10% penalty doesn't apply to conversions. Be careful here. Withholding funds to pay tax on the conversion results in a 10% penalty to the amount withheld. (Any amount not converted is a regular distribution).
    • For example, if you contribute $6,000 to a Traditional IRA and then convert that money to a Roth IRA, you’ll owe taxes on the $6,000, or whatever portion of your existing Traditional IRA basis ratio is to your rollover. IRS Form 8606 is used to help determine the taxable portion of a distribution or conversion and must be filed in the distribution year.) If you're non-deductible Traditional IRA contribution is immediately converted (rolled-over) into your Roth, (1099-R Box 7, Code "2" - Roth Exception),
    • You’ll owe taxes on whatever money it earns between the time you contributed to the Traditional IRA and when you converted it to a Roth IRA. (1099-R Codes for Box 7. ... Use Code 2 only if the participant has not reached age 59 1/2 and you know the distribution is: A Roth IRA conversion (an IRA converted to a Roth IRA) or a distribution made from a qualified retirement plan, or IRA, because of an IRS levy under §6331.

Wednesday, January 29, 2020

Revocation or Denial of US Passport: §7345 US Citizens with Seriously Delinquent Tax Debt

Revocation or Denial of US Passport: §7345) - US Citizens with “Seriously Delinquent Tax Debt"
New §7345 completely modifies how US citizens living and traveling around the world have to now consider very seriously actions taken by the Internal Revenue Service. It is the IRS, which now holds the power under this new law that requires the US Department of State to revoke or deny to issue a US passport in the first place. US State Department is in charge of the actual suspensions. 
  • In other wordsthe US State Department can revoke, deny or limit passports for anyone the IRS certifies as having a "seriously delinquent tax debt."
§7345 is part of HR 22 – Fixing America’s Surface Transportation Act, the “FAST Act.”
  • The two new IRS provisions: 
    • Passport Provision
      • Taxpayers with delinquent taxes in excess of $50,000 are potentially subject to having their passports revoked and/or denied unless they get into an agreement to pay the debt. There are many questions about the “due process” that the IRS will use to enforce this provision.
        • As an administrative exception, the State Department can issue a passport in an emergency or for humanitarian reasons, granting special dispensation. 
        • You are still able to travel if your tax debt is being paid in a timely manner, e.g. under a signed Installment Agreement. The rules are not limited to criminal tax cases or where the government thinks you are fleeing a tax debt.
        • In fact, you could have your passport revoked merely because you owe more than $50,000 and the IRS has filed a notice of lien. A $50,000 tax debt including interest and penalties is common, and the IRS files tax liens routinely. It’s the IRS way of putting creditors on notice. 
        • The IRS can file a Notice of Federal Tax Lien after the IRS assesses the liability, sends a Notice and Demand for Payment, and taxpayer fails to pay-in-full within 10 days.
    • Collection Agency Provision.
      • IRS may soon contract with private collection agencies in pursuit of taxpayer delinquent taxes. A monument concern with the IRS proceeding with private collection agencies, is to ensure taxpayers' collection due process rights, and taxpayers' rights to an “affordable” resolution as currently stated in the IRM are observed. An equal concern is the degree to which private collection agents are trained to help the taxpayer arrive at a suitable resolution based on the current IRM, and the many potential failures that could occur as the result of overly aggressive collection activity.
Passport Section Code Provisions:
  • New §7345(e) provides in relevant part as follows: “upon receiving a certification described in §7345 of the Internal Revenue Code of 1986 from the Secretary of the Treasury, the Secretary of State shall not issue a passport to any individual who has a seriously delinquent tax debt described in such section. . . ” [emphasis added].
  • §7345 that provides for a new collection technique—the revocation or denial of a passport to individuals who have past due taxes under certain conditions.
  • The denial or revocation takes place if the IRS sends certification to the State Department that an individual has a “seriously delinquent tax debt.” 
    •  A “seriously delinquent tax debt” exists when there is an unpaid, legally enforceable Federal tax liability of an individual:
      • Which has been assessed;
      • Which is greater than $50,000 (which will be adjusted for inflation in future years); and
      • Either:
        • A notice of lien has been issued and the administrative rights under §6320 have lapsed or
        • A levy has been made §7345(b)(1)
    • However it does not include:
      • A debt being paid in a timely manner under an installment agreement or offer in compromise;
      • A debt for which collection has been suspended
        • Because a due process hearing under §6330 is requested or pending or
        • Innocent spouse relief has been requested under §6015(b), (c), or (f) §7345(b)(2)
  • An affected individual will have a right to challenge either an IRS certification or failure to reverse a certification in either US District Court or the United States Tax Court. §7345(e)
  • §7345. Revocation or denial of passport in case of certain tax delinquencies.
    • (a) In general.—If the Secretary receives certification by the Commissioner of Internal Revenue that an individual has a seriously delinquent tax debt, the Secretary shall transmit such certification to the Secretary of State for action with respect to denial, revocation, or limitation of a passport pursuant to section 32101 of the FAST Act.
    • (b) Seriously delinquent tax debt.—
  • (1) IN GENERAL.—For purposes of this section, the term ‘seriously delinquent tax debt’ means an unpaid, legally enforceable Federal tax liability of an individual—
    • (A) which has been assessed,
    • (B) which is greater than $50,000, and
    • (C) with respect to which—
      • (i) a notice of lien has been filed pursuant to section 6323 and the administrative rights under section 6320 with respect to such filing have been exhausted or have lapsed, or
      • (ii) a levy is made pursuant to section 6331.
  • (2) EXCEPTIONS.—Such term shall not include—
    • (A) a debt that is being paid in a timely manner pursuant to an agreement to which the individual is party under section 6159 or 7122, and
    • (B) a debt with respect to which collection is suspended with respect to the individual
      • (i) because a due process hearing under section 6330 is requested or pending, or
      • (ii) because an election under subsection (b) or (c) of section 6015 is made or relief under subsection (f) of such section is requested.
        • Checkpoint summary of all three relevant provisions.
Revocation or denial of passports to certain delinquent taxpayers:
  • Under pre-Act law, Chapter 75 of the Code, “Crimes, Other Offenses, and Forfeitures,” makes no provision for denying or revoking passports on the basis of unpaid taxes.
  • New law. The FAST Act adds a new Code section,§7345, to Chapter 75 of the Code. (Act Sec. 32101) Under §7345, having a “seriously delinquent tax debt” is, unless an exception applies, grounds for denial, revocation, or limitation of a passport, effective January 01, 2016.
    • RIA observation: Passports are handled by the State Department, not IRS. This new provision effectively authorizes disclosure of certain tax information from IRS to the State Department, which in turn will use this information in making passport-related determinations.
  • Except as provided in the next sentence, a seriously delinquent tax debt is an assessed tax debt that exceeds $50,000 and for which a notice of lien has been filed under §6323. A seriously delinquent tax debt does not include a debt for which: there is an agreement in place to repay the debt under §6159 or §7122; or collection is suspended because of a collection due process hearing under §6330 or because innocent spouse relief under §6015(b),§6015(c), or §6015(f) is requested or pending.
  • The $50,000 amount will be adjusted for inflation for calendar years beginning after 2016.
  • The Act provides procedures for, and restrictions on, IRS's disclosure of the return information for purposes of passport revocation, as well as procedures for how an individual who was certified by IRS as having a seriously delinquent tax debt gets that certification reversed (i.e., in the case of an error).
New rules mandating IRS use of private debt collectors:
  • Under pre-Act law, IRS is authorized under §6306 to enter into “qualified tax collection contracts” with private debt collection agencies. This provision permits the use of such companies to locate and contact taxpayers owing outstanding tax liabilities and arrange for payment thereof. There must be an assessment pursuant to §6201 in order for there to be an outstanding tax liability. An assessment is the formal recording of the taxpayer's tax liability that fixes the amount payable. An assessment must be made before the IRS is permitted to commence enforcement actions to collect the amount payable. In general, an assessment is made at the conclusion of all examination and appeals processes within the IRS.
  • There are several steps involved in engaging private debt collection companies, and there are a number of safeguards and taxpayer protections in place.
  • The Omnibus Appropriations Act of 2009, however, included a provision stating that none of the funds made available under it could be used to fund or administer §6306 private tax debt collection activities, and IRS announced in IR 2009-19 that it wouldn't renew its contracts with two private debt collection agencies, having “determined that the work is best done by IRS employees who have more flexibility handling cases, which is particularly important with many taxpayers currently facing economic hardship.”
    • RIA observation: The National Taxpayer Advocate has repeatedly criticized prior efforts to use private debt collectors for unpaid taxes, noting that these programs raise significant taxpayer rights concerns and have repeatedly fallen far short of revenue-raising expectations.
  • New law. The Act adds two new subsections to §6306 (adding new subsections (c) and (d) after the existing (b), and redesignating prior (c) through (f) as (e) through (h), accordingly), both applicable to tax receivables identified by IRS after the enactment date. (Act Sec. 32102)
  • New §6306(c) says that IRS shall enter into one or more qualified tax collection contracts for the collection of all outstanding “inactive tax receivables.” An inactive tax receivable is any outstanding assessment that IRS includes in potentially collectible inventory, if:
    • (i) at any time after assessment, IRS removes the receivable from active inventory for lack of resources or inability to locate the taxpayer;
    • (ii) more than ⅓ of the period of the applicable statute of limitation has lapsed and the receivable hasn't been assigned for collection to any IRS employee; or
    • (iii) for a receivable that has been assigned for collection, over 365 days have passed without interaction with the taxpayer or a third party for purposes of furthering its collection.
      • RIA observation: The use of the word “shall,” typically construed as mandating a certain action, is a significant departure from the present law version of §6306(a), which permits, but doesn't require, IRS action.
  • New §6306(d) renders certain tax receivables ineligible for collection by private collectors, including those that, among other things, are subject to a pending or active offer-in-compromise or installment agreement, are classified as an innocent spouse case, or involve taxpayers that are deceased, under age 18, or identity theft victims.
  • The Act adds §6103(k)(11) to provide procedures and restrictions on the disclosure of return information to qualified tax collection contractors.
Establishment of special compliance personnel program:
  • New law. New §6307 provides that IRS should establish an account for carrying out a program consisting of the hiring, training, and employment of special compliance personnel. Special compliance personnel are individuals employed by IRS as field collection officers or in a similar position, or employed to collect taxes using the automated collection system or an equivalent replacement system. (Act Sec. 32103)
References:
1. Jonathan Bochese, Director of Resolution Services, Tax Defense Network
2. Internal Revenue Code