The Tax Questions Blog

Archive for June, 2008

Question: What is the point behind setting a $5,000 IRA contribution limit per year in the first place?

Especially with a Roth IRA... If I have already paid my taxes on that money, what does it matter if I put $5,000 or $15,000 into my own retirement account each year? Why would the IRS set such a limit? What if I can responsibly afford to meet my $5,000 limit each year with 2 or 3 months to spare? Now I have to just sideline that money or put it to work in a taxable account for the rest of that year. What about having a rollover option for any unused portions of the $5,000 limit each year, instead of the current "use or lose" setup. Surely, somebody else can agree with this.

Answer: Granted, your Roth contributions are post-tax, but that means that Uncle Sam loses the taxes on your growth. Do you expect Congress to understand that responsible saving is more beneficial to our economy than greater taxation?

Amend Internal Revenue Code of 1986 to increase maximum taxable income for 15% rate bracket, provide partial exclusion from gross income for dividends ... deduction, increase IRA contribution limit. $9.56 The BiblioGov Project is an effort to expand awareness of the public documents and records of the U.S. Government via print publications. In broadening the public understanding of government and its work, an enlightened democracy can grow and prosper. Ranging from historic Congressional Bills to the most recent Budget of the United States Government, the BiblioGov Project spans a wealth of gover...

Tax Season: Now's the Time to Get to Planning

December 20, 2009 (Tulsa World, Okla.) As if you weren't already rushed enough with last-minute holiday shopping and general year-end busyness, here's a little something extra to throw into the mix -- tax planning.

Question: As the owner of a company I reimburse employees for fuel on a daily basis, can I claim this as non taxable?

My employees do not fill out mileage logs, I do not want to tax them on their per diem gas reimbursement since they pay tax at the gas pump. Is there a way to do this without having them fill out a gas/mileage log?

Answer: Unless you are running an accountable expense reimbursement plan, any reimbursements you make to your employees MUST be included in their gross wages on their Form W-2. It's then up to them to claim the expenses using Form 2106 and taking an itemized deduction for any out of pocket expense. (For most employees this will mean that they won't get any deduction since the majority of taxpayers don't have enough expenses to itemize in the first place.)

If you are running an accountable plan you are restricted to reimbursements for allowable business expenses and the reimbursements must be fully documented. That includes mileage logs for their personal vehicles, and you may only reimburse them for business miles driven, not commuting. You should base your reimbursement on the number of miles driven, not a reimbursement for fuel. Your record keeping requirements will be somewhat reduced if you use the Federal reimbursement rate, currently 55¢ per mile.

In order for them to take a deduction for the use of their vehicle, they're going to have to keep mileage logs anyway so you might as well make it easy on them and reimburse the Federal rate and require them to turn in the logs monthly. That way you don't add the money to their W-2s, their tax prep job is much simpler, and if they don't keep proper records, they get no reimbursement from you.

Not sure what you mean by "they pay tax at the gas pump" since the fuel taxes have nothing to do with income taxes.

Blue Cross and Blue Shield of Minnesota Will Use TriZetto's NetworX Suite to Move Toward Value-Based Reimbursement ...

NEWPORT BEACH, Calif.----The TriZetto Group, Inc. today announced that Blue Cross and Blue Shield of Minnesota has licensed TriZetto’s NetworX Suite® of applications for further insight into providers’ case mix and greater flexibility in payment methodology and provider reimbursement.

2010 To-Do-List for Fund Investors

SAN DIEGO - In 2010 everyone will be exactly one-year older, but will they be any smarter? This is a good question, especially for mutual fund investors.

Question: Federal Marriage Amendment close to reality?

While I know this is a heated debate on both sides, it seems that the Federal Government has already actively written legislation regarding the definition of marriage by starting with polygamy. See http://en.wikipedia.org/wiki/Morrill_Anti-Bigamy_Act signed into law by Lincoln himself. In 1996, Bill Clinton signed the Defense of Marriage Act into law http://en.wikipedia.org/wiki/Defense_of_Marriage_Act which defines marriage as a union between a man and a woman and says that the federal government does NOT have to recognize marriage between same sex even if States permit it (e.g., federal income tax purposes, social security, etc.). There is currently a bill before Congress to amend the Constitution to define marriage between a man and a woman submitted 6/25 by Senator Wicker of Mississippi. Why the big push for a constitutional amendment if its already in the federal law?

Answer: Some states with very liberal secular constituencies have already legalized gay marriage. The purpose, of an amendment to the constitution, would be to prevent anymore states from doing that and to reverse those already legalized. It would also strengthen the rights of anti gay marriage states to refuse to recognize gay marriages performed in Mass or California.

Judicial Tyranny and Your Income Tax $9.99 The author, an experienced tax lawyer, reviews the principle court decisions regarding the federal income tax, and explains how persons may be be subjected to improper tax claims if they do not know what is explained in this book. A must read for tax lawyers, accountants, and anyone who has dealings with the IRS....

Q+A-India's proposed goods and services tax

MUMBAI, Jan 6 (Reuters) - India plans a nationwide goods and services tax, which would streamline its complex and overlapping revenue system, but has delayed the targeted April 1 launch as it looks to iron-out differences with the states.

Federal Income Tax - Why you should not pay

Question: As a Citizen of the United States of America, are we over taxed?

The phrase "No Taxation Without Representation" might not implicitly apply to modern day circumstances, but the underlying idea that taxation without citizens consent is to be strictly prohibited most definitely applies. Unfortunately I feel that my state and federal tax contributions are being poorly mismanaged and as a paying citizen, I want to make a change.

Are we over taxed, and . . .

Which 2008 nominee (so far) has the best tax reduction plan, and has the best voting history record and experience for managing my contributions?

Answer: Yes, we are overtaxed and we will continue to be.

The problem is that everyone wants entitlements. They expect "Sugar Daddy" government to solve all their problems instead of taking responsibility for themselves. Politicians understand that and continue to promise more and more and pay for it with more taxes.

The more the government gives, the more dependent the people are and the more we are all taxed. It's an ever expanding circle.

'People person' elected county commission chair

Newly elected Douglas County Commission Chairman Mike Olson said he's the people person while Vice Chairman David Brady is the money man. "That's why I feel confident we can do this," he said. The two were named by their colleagues Thursday to head up the five-member board in 2010. Olson, 47, said he will bring his skills as a communicator to the one-year position. "All of us worked hard last ...

Irish Garda - guards... What we pay taxes for