The Tax Questions Blog

Archive for February, 2010

Question: What are some good programs for saving for a child's college?

I know there are many investment programs that gear towards future college expenses. Some are non-taxable. I need a program that will hopefully grow but does not require a huge amount to start up. Any ideas? Thanks!

Answer: There are many investment programs out there that have tax advantages. I like 529 plans. Here is a list of some different programs. Check out savingforcollege.com for more information.

Qualified Tuition Programs (529 plans)—Earnings grow tax-deferred and distributions are tax-free when used for qualified post-secondary education costs before 2011.

Coverdell Education Savings Accounts— Earnings grow tax-deferred and distributions are tax-free when used for qualified post-secondary education costs. May also be withdrawn tax-free for primary and secondary school expenses before 2011.

U.S. Savings Bonds—EE and I bonds purchased after 1989 by someone at least 24 years old may be redeemed tax-free when the bond owner or the bond owner's spouse or dependent pays for college tuition and fees. In 2006, the tax exclusion is phased out for incomes between $63,100 and $78,100 (between $94,700 and $124,700 for married taxpayers filing jointly). These income limits increase each year.

Individual Retirement Accounts—Early withdrawal penalties are waived when Roth IRAs and traditional IRAs are used to pay the qualified post-secondary education costs of yourself, your spouse, your children, or your grandchildren. (Taxes may still be due on the withdrawals, however.)

(This information from savingforcollege.com)

Extra Space Storage Inc. Reports Fourth Quarter and Full Year 2009 Results

SALT LAKE CITY, UT--(Marketwire - 02/22/10) - Extra Space Storage Inc. (NYSE: EXR - News ), a leading owner and operator of self-storage properties in the United States, announced today operating results for the three months and year ended December 31, 2009. Highlights for the Three Months Ended December 31, 2009: -- Achieved funds from operations ("FFO") of $0.22 per diluted share including ...

Question: how long does it take IRS to return tax refund?

I went to H&R block April 9th to file for my tax return. They said 6-8 weeks and today was 8 weeks so we called them and they said they had sent it (or something like that) to IRS and that they have to send it to me (or something , I was watching my daughter while doing this so i couldnt hear her that well) but how long does it take for IRS to send your tax return out? its already been 8 weeks.

Answer: You can check the status of your tax refund on IRS.gov and click on the link "Where's My Refund". If you paper filed and requested a check, then it would be about 6-8 weeks. But if you e-filed, then it shouldn't take more than 4 weeks.

And H&R Block should be able to tell you if the IRS has processed your tax return yet.

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A taxing time of year

PLATTSBURGH — Here's wishing you many happy returns — tax returns, that is. A few local tax experts recently offered their take on the current tax season complete with local challenges and trends.

How I Run My Business Richard Davis (Take Me Home Taxis)

Question: So what happened to all the jobs that were supposed to be created with the Bush tax cuts?

Why did the IRS have to sue the UBS (Swiss Bank) to release the names of 52,000 tax cheats hiding about $15 billion in US currency in offshore tax havens?

I thought the richest 2% were going to use their massive Bush tax cuts to stimulate the economy and create jobs?

How exactly does hiding the money in an offshore tax haven stimulate the US economy again?

Is there any bigger argument to put the tax rate for the top 2% of wealthiest Americans, back to where it was under Republican President Eisenhower during the 1950's, which was one of the most prosperous decades for the USA during the 20th century?

http://www.usatoday.com/money/industries/banking/2009-02-19-ubs-tax-evaders-irs_N.htm

http://www.marketwatch.com/story/irs-ubs-agrees-to-hand-over-us-accounts-2009-08-19

Bullseye: The Bush tax cuts are still in effect and unemployment continues to rise.

So it is a legitimate question.
BTW: I'm in the top 10%.

Answer: Money that big business saves by tax cuts is not reinvested in jobs. It's reinvested in various assets so it can earn more money simply by being invested. Capitalists would prefer not to throw money away on wages. Tax cuts = job creation is a total fallacy

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One year later: Stimulus bill failed to create jobs

Almost exactly a year after seeing 787 billion of their tax dollars evaporate courtesy of a so­called “stimulus bill,” Americans are justifiably running out of patience and asking “Where are the jobs?” President Obama and congressional Democrats rushed the stimulus bill through Congress last Febru­ary amid dire predictions that failure to pass the bill would result in double-digit unemployment ...

Tax Cuts, Not the Government, Create Jobs

Question: Advice for avoiding owing taxes in 2008?

We are sick of owing around $3000 in taxes! The so called tax reform did us absolutely no good - we owed more this year, and our bracket did not change. Taxable income, around 120,000 - standard deduction, no mortgage interest to claim. Each of us claim 0 deductions from work, even though we have 2 kids. We do have interest income from trying to be good savers, which at 25% tax rate would account for some of the taxes owed --- but only about 1/2. If we could take the child tax credit, it would look good - but we are over the limit for that. Tax time is a real downer around here - any advice in planning for 2008?

Answer: I had the same problem a couple of years ago, I had my taxes done by professional tax preparers and I thought I would be getting back at least a thousand or more in refunds,I was so very disapointed and aggravated, I actually had to pay in a couple of thousand. I look at it this way, when you go to these type tax preparers, they say" hey ,looks like you have some extra income this year,looks like your gonna have to pay in.These people work for the government, they are just as dishonest as anybody else, they don't allow you any extra loopholes, to save you money, let alone bothering to tell you about it and any extra monies that you thought or were anticipating getting back, will always end back up in their pockets.
For the last 2 years I do either Turbo tax online or Tax act online, they give you many more options as far as finding and using those loopholes and they walk you right through it, step by step, its so easy, really. Needless to say, I was able to get back a nice sizable refund, as compared to the latter years of having to always pay in.

The whole sad truth here though is that you just can't ever get ahead, the IRS drains the very essence of your life out of your bank account. And they just don't care, I know one thing though, now I see why many people choose a second job off the books for cash, or work totally for cash, because the IRS enjoy us supporting their high paying jobs for one and they actually push people to become dishonest for those reasons, mainly because most people are just trying to get by these days and struggling due to inflation of many things like gas prices. Instead or rewarding people for working harder and longer hours trying to do the right thing, the IRS takes it away from you and slaps you on the wrist.
Hope this was helpful, and thanks for letting me vent about the dreaded IRS.

Interesting to see how Gordhan balances the national accounts

Higher rates reduce the incentives for entrepreneurs, which hurts the economy in the long run.

Preparing for Retirement - Case Studies

Question: what do you think a call girl makes a week? If ever legalized how much should they pay in taxes?

As most of you know i am a call girl..(not a street walker or drug head) so try to be respectful when you answer this..I will post the round bout answer..(i also run an escort service so the numbers are from my books and my girls) How much of there income should be taxable if this line of work was completely legalized? Would there be tax write offs for std and HIV/AIDS testing? Would there be write offs for supplies like a regular Business?

my lowest earner made 7,900 last week and my highest earner made 12,050 last week these gilrs work everyday. so at the least its 410,8000 and at the most 626,6000 a year thats millions in tax's a year that could be paid to the goverment if they would legalize this...
JUST A GIRL...Just because you dont respect what i do doesent mean that millions of other people think like you..If they did we would not make the money we do...Second off i did not relize i posted it here untill after. Take the stick out of ur behind and be happy.

Answer: I don't really know much about this, but I do live in a country that has no law against selling that kind of services (it's about to become illegal in a short period of time). I read an interview once, about a woman who ran a call girl service. They paid taxes and all (in order to get paid when retired, after age 67) and they got to write stuff off, but I don't know specific things, though.
(At one time, a playboy model wrote off her boob-job on the taxes).

Alimony Payments Affect Taxes

If you are the ex-spouse getting alimony payments, the money is taxable to you as income in the year it is received. This added income calls for a couple of additional tax considerations for the reci...

The Farm that Barters In Bucks County